All Forum Posts by: Derek Luttrell

@Kyle Ferguson @Thomas S. is spot on about making saving, clearing debt and growing your wealth a priority with your significant other. My girlfriend of five years (we're 26 now) was the one who introduced me to BP, and she is the one who suggested we start house-hacking, so we have been doing so for almost a year now. 

We went from each paying $1,000/month for rent in Chicago to each paying $250/month in the house hack. She had the drive to better our situation, and the smarts to use my higher income to get it done. The next place we move into will be on her dime, since we're both able to save so much more now than ever. 

@Brad Mast Everlance has been nice for me. You take a picture, and it logs the date, a description, the vendor, etc. 

I'm not positive if it does or does not export to Quickbooks, but I know it at least exports to Excel. 

I visited my dad in my hometown of Fort Wayne, IN this weekend, while also having an appointment to check out a SFR on the market. I also visited an old friend whose wedding I'm going to in June, and it just so happened that she was 5 days away from listing her house that she had bought two years ago (once married, she's moving to Indy where her fiancee lives).

After doing the necessary homework, I got home and decided to send her an offer before she had the chance to actually list it. It's in the dead center of a top school district, and I would have definitely had competition. I will be self-managing from Chicago, with my Dad as my handyman/drive by lookout when needed. Obviously, I still ran the numbers as if I had a PM in place. 

I turned 26 a few weeks ago, and this is my 3rd property since July 2017. I'm really starting to get more and more comfortable, which is a fun feeling. Here are the numbers:

Listing price (what it would have been): $135,000

Offer: $130,000

Contract: $132,500, with her paying $489 for a home warranty

20% down at 5% interest 

Rent: $1400 (3/2 single family ranch with attached 2 car garage) 

Tenant pays all utilities (even down to trash pickup) 

Cash Flow: $250/month after CapEx, Maintenance, Mgmt, etc; $115/month if using 50% rule

I put 12% into a Roth 401k, and depending on that month's commission I save 70-80% of my take-home pay after that. I do this by house hacking, which I admittedly would have never done without my girlfriend casually telling me about BP at dinner one night about a year ago. Combining the house hack and cash flow from my one other property, my housing expenses are more than paid for by other people. 

High savings rates are also much easier with high incomes. I made $154,000 last year, and through April am pacing for $234,000 in 2018 (I know it's early in the year, but heck it's still exciting to track). I just turned 26, so keeping my expenses low isn't very difficult. This can all change with marriage and kids, but I look forward to enjoying that part of life only once I've built a solid foundation to build that family on. 

@Rodney Reeves at least here in Chicago, I had tons of interest, and I was able to be picky in who I chose to live with me. All the living room furniture, TV and kitchen supplies are mine, so I think it was appealing for people to just bring their bed and their toothbrush and be ready to go. 

In terms of screening, after meeting them in person I had them send me their latest 2 pay stubs, and I ran credit/background checks. They also both have a 12 month lease. They pay rent via Chase Quickpay and Venmo. 

I rent to roommates in my primary residence as well. A couple weeks before closing, I put up ads on all the major websites saying I was looking for roommates. I used the photos from the original "for sale" listing that was up before I made the offer in the first place. After a few e-mails back and forth from interested roommates, we met in person and I let them know that my official closing hadn't happened yet. I actually found that the pictures did the place enough justice, and the roommates were more concerned about who they would be living with than what the place looked like in real life.

I'll admit I don't plan to scale with this method, but my house-hacked primary residence is a condo, and my first 20% down buy and hold rental was a condo. I'm priced out of MFR and SFR here in Chicago, but my rental was a 2- bedroom for $122,000. It's going well so far, and it was a great way to learn the ropes of tenant screening and such, which has made me more confident about jumping into SFR or MFR a bit further out of city where it's much more affordable.

@Samuel Pawlitzki in terms of rentals, the 3-bedrooms ask for $12-1400 depending on finishes and amenities, while the 4-bedroom that is available is asking for $1600. 

I've been looking for some type of platform to search past rentals that are now leased, because average days on market would be a great metric to know. Do you have any suggestions for that? 

Hi All, 

This weekend I went and toured a listing that has a 4 bed/3 bath main house (1800 sq ft) that comes with a 2 bed/1 bath coach house on the lot. The main house is owner-occupied, and the coach house is tenant-occupied for $850/month. 

This town has a population of about 30,000, and the stats I've found show that 46% of adults there are renters. It's on a street of primarily MFRs, but does anyone out there have 4 bedroom properties in their portfolio? Looking at rental comps, there is only one other 4 bedroom available in the town right now, and it is asking $1600/month. I just can't tell whether or not it's too much house to be used as a rental. 

Morning Everyone, 

Well, I guess you can sort of count the rent I've been getting from my roommates while house hacking over the past 8 months, but this morning is my 26th birthday and I woke up to the Chase Quickpay rent payment from my tenant at my first true investment property. 

He moves in this afternoon, and I'm meeting up with him to hand over the keys. 

Just wanted to say thank you to everyone on here who has helped answer my questions and address my concerns along the way. Pre-approval in hand, I have an appointment for tomorrow to go see what might be my third property. I've caught the bug--my goal is to have 10 properties and/or $4,000 in cash flow by age 30. 

Thanks again, 

- Derek