All Forum Posts by: Andrew Pfleger

Where in Bethalto is this property located? I’d be interested in seeing it or a link to it. You’re possibly just on the high side of the market depending on shape of property and location. 

I'm currently on the Illinois side of the river but would like to branch out into the Missouri side. Wondering if there is anyone who has done this and has some advice? Maybe your an agent and know the area well enough to help. Lets connect

I am 38, started at 36 in 2017... Since February of 2017 I have accumulated 45 units. Hoping to continue that same growth pattern for a little while longer. I currently still work a W-2 job on top of self managing 45 units with a partner. It's been fun, a little stressful at times but overall a good experience. 

@Jim Goebel First... Thanks for the reply! 

Yes, that is correct, roughly 22K per unit. I know, insane... I'll try to dissect your response. Since my partner and I are fairly new to investing and owning property we are in the process of a few things... 

So far we've gotten right around the 2% rule on about everything we have purchased. I'm currently working a W-2 job that I could probably retire from after 30+ years or so of just doing the norm (my partner is a CPA but is a stay at home dad). I'm late 30's, and constantly being pulled away from my family. Funeral service is great, I love the aspect of what I do but I hate that it comes with the price tag of always being there for someone elses family before my own. 

We bring in roughly $250-300/mo cash flow per door so to this point we've bought value-add properties. The worst property on the best street with rents that are considerably low. My partner and I are both from this area (born and raised) so we know the areas that are worth investing in etc. 

We have purchased a 4 unit just a week ago that we paid 50K for the property but added 20K for improvements flipped a unit the week after close and raised rent $125/mo. We'll prob need to flip 2 more of the units and we'll raise those rents as well. We bought a duplex a year ago for 35K that was headed to auction before we made an offer. It needed new carpet and paint in one of the units. There's a current tenant who is paying $200 below market value and we raised the 2nd unit rent to now get $700/mo rent. We just landed a 5 unit building for $110K, 4 of those units have been remodeled. a 3 BR unit needs small improvements. All this to say that we are in a 50% rental area. Prob what some would consider lower income with a lot of potential. Pockets of bad but for the most part good. 

This area is right on the Mississippi river about 20 mins from downtown STL. So we're essentially a bedroom community to STL. A lot of commuter traffic to and from for work. Its a little deceiving to call us the "Alton" area because Alton-Godfrey are essentially the same. They both share the same schools, you aren't sure at times if you're in Alton or Godfrey. Alton was a booming city back in the hay-day. More millionaires per ca pita than anywhere else in the country (or so I've been told). We're home to Winchester ammunition, a couple of Steel Mills, a glass factory, the box company, all of which are gone. The one thing that remains is a shadow of the Steel Mill. About 10 years ago a local attorney who's done quite well (John Simmons)revived it. (hopefully this isnt too wordy)

On the flip side of the down-side we're a tight community. We were just featured on Hulu's season 3 (airs October 4) Small Business Revolution, named top 10 places to retire by AARP and another large publication that is slipping my mind at the moment. 

To this point we've focused on X number of doors to get to a specific cash flow number in order for me to have the option of walking away from my W-2... 

specific challenges have just been

*finding that sweet spot of property and location and getting the bad inherited tenants out 

*getting improvements done that needs to be done. We have a great team but trying to get the amount of work done we have can be complicated logistically. 

*having enough time to do it all in general 

*local PM company is not up to our standard so we have to self manage.

positives

* we've got some really good systems in place that help things go smoothly

*in 2 years we've never had to evict anyone and we've collected roughly 97% of rent in that same time. 

*we added my college roommate and best friend who has committed to investing 1.2 million after seeing Ryan and I work this market for a year and saw potential in both our LLC and the area we are investing in.

Life style changes? I prob need to make a decision sooner than later to go all-in and walk away from my W-2 or hire help. 

Learning what I want to learn or need to be learning? I feel like Ryan and I are learning as much as we can in the time we have to learn. We've learned on our own, we've learned a ton from BP, and we've been able to discuss topics with people in the area (local experts) who we've been able to get in front of.  

Outside of that, I just hear a lot of the "all-in" mind set and I get excited and am ready to dive right in. We've gotten this far. I feel like the only thing holding us back is time. 

Be Gentle!!! Ha! again, thanks... 

I've listened to quite a few podcasts and have been intrigued with most of them. The ones that really get the blood flowing are the ones like "298" where the purchase happens to be a large number of units.

I still feel like a newbie but I'm a 100 mph type of person. Currently my partner and I have acquired 45 units (just shy of a million in total real estate) in less than 2 years and we're building solid systems and allowing the dust to settle. 

I guess I have a multi-faceted question... where do I find the listings that are more than 10-15+ units? I'd prefer to stay somewhat local vs investing in an unfamiliar area of the country. Or should we branch out and look for properties that are long distance? And finally, should we keep up this pace or should we relax? 

I'd search or a upgrade but not new. there are plenty of options out there on sale sites. as has been stated... you can find a "like-new" appliance that was prob in someone's home for a few years and they took care of it but wanted the latest oven so they sell to you... I wouldn't buy new

Thanks! 

Funny that the "how-to write a new member post" used Lawrence, KS. as a location ( I attended and graduated from Kansas University located in Lawrence)…. 

My name is Andy Pfleger and I'm currently a full time funeral director and have been in the funeral service for 10+ years.  I've been married 10 years this past July and my wife, Lacy and I have 2 children. We bought a house about 7-8 years ago and ended up flipping it during the 5 years we lived there. We caught the "bug" you could say with moving in and improving and selling for a profit (House Hacking is the BP term from what I understand). We ended up selling the "Aberdeen" house (in 6 days) so we could buy a total gut that was built in 1905 and hadn't been inhabited for 6 years prior to us buying it. We paid 22K for this home and put about 75K into renovations and it is currently valued around 130K +/-. 

After having success with the 1st house, and people starting to follow our projects with the old house we bought we really started to wonder what we could do with this skill set we had discovered. I was not afraid to get my hands dirty and my wife was pretty good at the design aspect. We figured a rental or 2 would help with some passive income to maybe buy a flip or just help with added income in general. 

This is where the story gets really good. There's a 6 unit building next to our home that came up for sale. We looked at it and were unable to come up with the funds for the down payment. 20% of 180K... At the time we hadn't discovered the info and creative ways to fund purchases that we are aware of now. So I was discussing this with a friend who happens to be a CPA by trade married to a OB-GYN and he was interested solely because of the tax benefits real estate brings to his life... So we discussed funding and how much each of us would need to bring to the table. We actually passed on the 6 unit and found some less expensive units that made a little more sense for us "out of the gate." 

Our first purchase consisted of a tri-plex (paid 67k) that needed some TLC (fully rented) across from the local dental school and a duplex (paid 45K, that had a hoarder who we had evicted as part of the purchase)  about 3 miles or so from the dental school. We immediately renovated the hoarders unit, put new carpet in the adjoining unit and rented them both 3 weeks to the day after purchase. So we paid 67k and 45K, borrowed a little to update what needed to be updated and then got the rents coming in. 

We were enjoying real estate, listening to podcasts, reading BP forums, and generally planning for the future. We kept coming back to a 5-10 year growth plan. Pour all of the cash back into the business, take a small fraction out occasionally but for the most part just focus on long term growth. We ended up coming across a friend/acquittance that really wanted a house (a specific house that was for sale). We ended up purchasing it(110K... he helped fund the down payment but is self employed and could not convince the bank to fund the purchase) and we put him in a 3 yr $1500/mo lease. You can imagine the cash flow on that is amazing. So now we have some extra cash flow we weren't expecting and another duplex came up for auction down the street from my house. We bought it for 35K prior to it going to auction (1 current tenant who maintained it). It needed very little work so we were able to fill the open unit for $600/mo. 

All this to say... We went from forming an LLC with a 3-plex and a duplex in February of 2017 to having a million dollar investor and currently sitting on 45 units. We have 3; single family homes, 3; duplexes, 2; triplexes, a 4-plex, 2; 5-unit buildings, a 6 unit building and a 10 unit building.

If you can imagine being a funeral director and a landlord for 45 units (fortunately I have a CPA partner who can handle the books and the occasional tenant outreach)

Ryan(the CPA) and myself are thankful to BP for the forums, the podcasts etc. because a large part of our success has been because of the systems we've been able to learn about and soak up from other investors here on BP.  At some point maybe we'll get to share our story and help others who are in the same situation we were and want to grow as quickly as we've been privileged to grow. 

Andy Pfleger

Alton Illinois (look Alton up on season 3 of Hulu's Small Business Revolution) 

Im unable to load a photo. the option doesn't come up on my profile page. 

here is a photo in case support is able to or needs to add to my profile. thanks

thanks guys... I'll look into Cozy. Always appreciate any direction.