Would like some advice

Question

OK so first off I am brand new to real-estate. I am 50 yrs old, my home is paid off and I plan on retirement from my government job in 7-9 years. I have 45k in my bank savings and I want to buy 2 duplexes that would generate passive income in my mid 60's. I'm worried about starting too late. Am in being realistic about having 2 properties at my age? Is there a cutoff age? I appreciate any feedback from late starters or folks who might have some insight. 😊 Thanks

Jeffrey Barrows · Answer

I was thinking about 2 duplexes under property management.  Since my house is paid off I would put the extra capital i was paying for a mortgage towards the principal of the 1st property I purchase to pay it down quicker. I don't plan on getting rich. I just want a comfortable retirement.

Eliott Elias · Answer

The quickest way to create this passive income is to pay off your duplexes cash to unlock all the rents. I would use the 45k and take out a HELOC on your primary to pay down property in cash. If you want to live off of cash flow it's going to take a lot of property to do that if it's not paid off

Drew Sygit · Answer

@Jeffrey Barrows what else are you going to do when you retire?

Stephen Brown · Answer

It is never too late and completely doable. I think you could easily do it if you buy right and in the right market. I would also say try to find some private money.

Nicholas L. · Answer

@Jeffrey Barrows

no, it's not too late.  but, food for thought - cash flow has been compressed because of where the market is.  so, i'm not sure what you were contemplating, but if you just go buy a solid, on-market deal that doesn't need a lot of work and put it under property management (as you should!), you'll probably net at most a few hundred dollars a month.

is that what you want?  if so - great.  but this doesn't have to be your only option.

before you jump in i'd go to REIA meetings, network, and go look at as many properties as you can.  don't buy a deal just because you just found BP and feel like you're missing out.

Chris Seveney · Answer

@Jeffrey Barrows

50 is not too late to get started. There is never really a time when it’s too late to get started.

So answer your question yea you can get two duplexes for cash flow and have them provide passive income for you later on in life.

Fwiw: ray kroc started McDonald’s at 52.

Billy Daniel · Answer

Of course its not too late!  I know some land lords who are in their 80s!

With $45k and a paid off home, you could get into something that would generate a good amount of cash flow each month.  Here are a couple of tips:

1. Use a realtor to help you in your search.  Try to find one that has their own investment properties so they understand what you are looking for.

2. After the purchase hire a property manager.  They cost a little, but your stress level will drop to near zero.  Factor in a 10% property management fee into your analysis before you buy.

Good luck!  The first one will be nerve racking and uncomfortable.  The second one will be amazing and fun!

Hoi L. · Answer

I just turned 49 and my RE adventure was suggested by my wife and I ran with it.  We have now acquired 4 properties (3 SFH and 1 5-unit multi).  All of them are leveraged (especially when the rates were still historically low) to 30-yr loans fixed at 4.5-5.5% (under LLC), except for my 5-unit multi which was bought with family loan assistance at 5 yr repayment.  All are self-sustaining investments in theory, but some have needed more immediate cap improvement money.  In the long term, they will be a small but steady income generating properties.

Once my primary residence is fully paid off (originally fully paid off on 2027/8, but we refinanced 15 months ago to 2030 with rates from 3.625% (2014 originated) to 1.95%), we will either buy more properties or start the avalanche pay-off method to speed up the loan repayments.  We are planning to be still in the game well into our 50s-60s.

I say never too late if the properties will be self-sustaining and you have "heirs".

Would like some advice

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