When to add to your buy and hold portfolio

[Malcolm Kelly]

Hello everyone,

Im new to Bigger Pockets.com so this question may seem elementary to some but Im curious. Im in the process of selling off a previous business venture and once I do Im going to use the money to strictly invest in buy and hold properties in the Houston area mostly multi units. 

My question is once you've purchased your first rental property how do you determine when its time to add the next property to your portfolio? Is it positive cash flow? A certain length of time with positive cash flow? ROI? Im assuming there has to be a rule to abide by in the building of your rental portfolio. By the way the podcast are priceless.

Thanks for any help.

Malcolm

[Account Closed]

I don't think there's a hard and fast rule. I think other things come into play like you're comfort level in buying another one, your ability to manage another, your cash flow situation, your reserves, your other income streams (if you have some) etc.

My personal approach is that I look for the best deals when I'm comfortable buying something. I might have some major repairs/renov going on and I might want to hang tight and let those settle, others might not...I'm mostly solo in terms of financing while others may have a group hence the purchasing power and flow is a bit more robust..that's just one example.

Sometimes saying no can be just as good as saying yes.