First Successes -> Home Ownership

[Tim Laderach]

As my wife and I explore real estate investing and try to put our passions into action, I sometimes feel discouraged and as though there is a large veil between me and my goals that I just can't break through... I recently pulled out of this downward spiral when I remembered that we are already real estate investors by being home owners!  Hopefully this can be an encouraging reminder to anyone wanting to get started in investing.

As a military family, we're poised to move, and move often. We're in the early part of my career, but have already had successes with real estate. Our first home was in Jacksonville, FL, a market that is growing and has seen a surge in population over the last few years. We bought a 3/2 @ $166,000 in 2014. We improved the kitchen, just by painting cabinets, adding hardware, adding a range-hood that matched the stove, painted the door and did some yard work. These simple things along with the increase in the market helped us to sell at $188,000 in 2017. My wife, being a Realtor, saved us money on the commission we didn't pay to the seller (us). My VA loan benefit helped us at the beginning with 0$ down, so we essentially made a ridiculously awesome ROI (~$20,000 from ~$4,000 improvements). We took that money and invested in our home here in Alexandria.

Here we purchased a 2/2 townhome in 2017 for $560,000, only putting 5% down, again thanks to the VA loan. We've since renovated the kitchen and one bathroom and are working on the back yard. Comparable homes in the area have sold this year for $600,000 plus ($40,000 appreciation in just 1 year). If this trend continues, we hope to sell for around $650-660,000 in 2020 when we move to our next duty station. Unfortunately, rents in this area are not that great for SFH compared to the mortgage on a 5% down loan (even compared to a 20% down loan they're not that great), so sell, we will. Again, we will benefit by my wife being our Realtor.

So, even when it seems overwhelming to become a "real estate investor," owning a home can be a great way to break the ice.  We haven't purchased deals by BP standards, but we've thoroughly enjoyed the homes we've lived in and the neighborhood we're in now.  It's always important to reflect on where you are and what you have done to get there.  It's also important to stay positive.