Almost 2 years into being a buy-and-holder - 18 units & a full time job

[Brandon Schlichter]

I still wouldn't mind hitting 50 units this year as per my other post - http://biggerpockets.com/forums/522/topics/160698-...

However even if I don't, I'd still consider myself a success.

Mid 2013 I was able to source investment in return for equity for a buy-rehab-rent-refi setup that I wanted to do. The equity split is extraordinarily favorable to me, so as part of the deal, I was willing to quit my 'dayjob' of managing websites and go into REI full time.

Since then, I've been able to buy and rehab a total of 13 properties consisting of 18 units in my area.

Total expense has been in the neighborhood of $550,000 with around $110k being financed via refinances at the bank. The bank was, and still is extraordinarily slow to lend, and we're having to change our strategy a bit to incorporate flips into our model while we wait for the properties to season a little more.


Metrics look like this :

~$440k in via equity investment + a minor amount of rental income
$110k debt (Resulting in debtservice of $750/mo)
For a total of $550k invested.

ARV between 3 properties of $850k - So a net equity of $300k or so.

Monthly rental revenues of $11,000

Costs are 
$1000/mo in insurance
$1000/mo in property taxes
$1500/mo saved back for maint/repairs - Actual expense last year was around $700/mo due to the fact we try to fix everything that might need repaired in the next 5 years, so far it's worked quite well
$500/mo for vacancies (Actual vacancy rate was 3.8% last year based on total of damages + lost rental days).
$750/mo in debt service ($285 or so goes towards principal curtailment)

For a grand total of $6,250 in monthly cashflow or 16.6% return based on the $450k cash invested. Our LTV right now is <14%. If we could refinance to say 60% LTV, it'd put $370k more in our pockets to buy more properties, and only dip cashflow to $3,600 but effective cash ROI would be 50%-60% with a healthy $1650/mo going towards principal curtailment.

My total time investment is pretty low overall, and the best part is I've created some pretty serious value in the properties as we're getting independent appraisals and they're all coming in close to my ARVs.