#7 SFH Closed Yesterday

[Max Shaw]

Hey Everyone,

I'm pretty pumped because, I just closed on #7, paid 100k for it appraised for 125k. I put 20% down from a line of credit I obtained on a different home I bought a little while back. Soooo, I'll be able to do the same with this one and keep the process going. The house cash flows even with both notes being paid. Nothing wrong with the house at all. Just some minimal clean up and shes ready to roll. I bought it foreclosed and the bank performed a remodel complete with granite in the kitchen, new paint, and flooring throughout. I'm a singles hitter, and this one falls right in line. Total portfolio is flirting with the 1M mark, which is my goal by the end of 2016. 3M by 2020 and chill. This site really is awesome, there are no questions I can't find the answers to, and its always great stealing everyone's awesome ideas about how to grow not using your own money. I could have easily paid the down payment, but why use my own money when I can have my tenants cover it for me.

[Vincent Crane]

It's great you're growing the portfolio but I do have a concern. It looks like the cashflow is too skinny and over estimated. You need to factor in property management at 10% of the monthly rent, and then another 10% for monthly repairs, along with your 10% capex. $100 for capex/repairs won't be enough in the long run when it needs a new kitchen, roof, flooring, and bathroom in 20 years. And property management has to be factored in so that you're paying yourself for your time, or if you ever decide you're sick of managing the property that you can have someone else do it. Otherwise it's creative accounting which isn't true. Had to play devil's advocate