My first rental, 11 years later.

[Jon K.]

I did something this week that caused me to reflect a bit on where I started and how far I've come. It was a fun realization so I thought I'd share it here.

I purchased my first real rental 11 years ago off the MLS for 108k (put 20% down). It's a 3 bed, 1.5 bath townhome. Rented for about $1250/month at the time. It was turnkey so I didn't have to do a thing to it. Over those 11 years it has been occupied for all but 3 months until this most recent turn. Typical maintenance and capex, no real disasters. It has basically printed money for me from day 1.

Fast forward to today. I recently went through an exercise where I examined each property in my portfolio to decide if my capital was positioned the way I wanted it to be and that had me consider selling this property. I ran the numbers two ways: selling vs cash out refi back up to a 75% LTV. I came to the conclusion that a cash out refi was the way to go even though it won't cash flow great afterwards (it'll still be positive about $200/month). Today that same property rents for about $2,400/month and it appraised for 235k.

This is the part that I thought was fun that also made me reflect on things. I was able to pull 110k of equity of out this property that I had bought for 108k. And the reality was I only put 20% down plus closing costs. I know, inflation and those aren't the same as today's dollars etc. But still... It's easy for me to get lost in the grind or to focus on goals instead of progress so I'm glad that I took this moment to remember where it all started and that was with a gamble on this one property that has paid off ever since.