Rental owner in Claremore, OK; purchasing in Stevens Point, WI

[Samuel Bavido]

Howdy folks, 

I've been spending some time on the blog and listening to podcasts on Youtube, and figured I'd create an account here for networking/questions purposes. I don't know that I'll be really active for the next few months, as I'm not in a position to purchase anything at the moment, but I'm hoping to change that this year. 

A tad about myself and my real estate history: 

My parents refused to go into debt for a home because they followed the teachings of cult leader Bill Gothard. My dad is a Licensed Professional Electrical Engineer, so he makes decent, upper-middle class money, but (as if often the case with cult followers) he received horrible financial advice that hurt him a lot. Go look up Cactus Ave Mobile Home Park on Google Maps...we were in the trailer farthest to the south. The next door neighbor's little boy got in trouble with him mom when he said that my dad was an engineer, because she told him that nobody who made that kind of money would ever live there. 

I won't give my entire life story, but just suffice it to say, I didn't have a great example. However, at the same time my Mom instilled a love of real estate in me. She was as anti-debt as my dad, but she constantly spoke to us about the importance of buying assets. Granted, they never had enough money to buy assets...but she did talk about it being important. 

Fast forward a few years, and I'm living in Taiwan, teaching ESL at a public school. I married another ex-pat, who brought a small property to the marriage; 10 acres along HW 40 near the Painted Desert National Park. Her dad had found it on Ebay and encouraged her to buy it for $12,000 over 10 years. 

Living in rural Taiwan, with it's very low cost of living, we were bringing in a lot more than we needed. For the first year or so we didn't really make the best decisions...lots of traveling and eating out. I eventually convinced my wife that we should live on my salary alone, and save all of hers. In a short time we saved up $23,000. It felt like enough to ransom a king. We found a place a couple miles from my parent's house in Claremore, OK that seemed decent. Note that I had NO IDEA how to figure out what a good property was, and I didn't do anything beyond the most basic calculations. I actually didn't even see the property until after we'd put money down...my parents worked with the realtor and viewed the property and thought it a worthy investment, so invest we did. We were still in Taiwan through this whole process. Proving income to the bank when all our bank and employment information was in Chinese was a nightmare...but we made it work. We closed while visiting family in the US in July 2015, hired a property manager and got a tenant by September. It's 1,100 sq ft, on a postage stamp lot in a C+ neighborhood, 3 beds, 2 baths, 2 car garage. It's within a mile of an elementary school, junior high and high school, and a 10 minute drive from a 4 year university. The owner put a new roof on as part of the purchase deal. We paid $92,500 for it and put 20% down. If I use the bigger pockets calculator, it only cashflows about $50/month. However, we've not had any vacancy or major repairs to date, so we've been throwing an extra $300/month into the mortgage payment. 

My wife and I have decided to return to the US, and we'll be moving to Stevens Point, WI in July. We have a written agreement to purchase a house from my sister-in-law there. It's 3 bed, 1 bath, 1,400 sq ft with a full, unfinished basement. It's 4 blocks from the University of Wisconsin, Stevens Point. My thought is that it will be fairly easy to raise the property value by finishing the basement (we did have a basement expert check it for water problems, and that's not a problem), and then we won't lack for renters when we're so close to the university. My hope is to live there for 3 or 4 years while I get a couple more cash flowing properties in the area, then eventually move into a more permanent home and rent out this one. 

Long term, my goal is to build up a few million in cash flowing properties that I can retire on. I'm 32 now, and I would like to retire by 55. It's very important to me that I leave something worthwhile to my kids, and that they not be burdened with the cost of caring for me and my wife when we're older. Short term, I'm looking to get into multi-family and apartment buildings.