All Forum Posts by: Brian G.

@Cody L. Sweet. Congrats! How did you scale/grow your portfolio?

@Joel Oh nice. How much did you net after all your expenses?

@David Corrales ideally you want all funds deposited directly into your business account. That would be the best business practice.

@Schadrac Mertis I would continue to focus on building up your net worth and equity position if you are having success with your current strategy. You can always convert your equity into more cash flowing assets later via 1031’s or simply reposition the debt in your current portfolio by selling off a few assets to pay off some mortgages and/or doing some cash out refinances to grow your portfolio. Doesn’t sound like your goal is to quit your job asap therefore focusing on equity is a great way to position yourself to reach your future goals. Good luck!

@David Corrales just open a separate account in your personal name and run all business income and expenses through that for good record keeping. Keep good record of all expenses (ie digital copies). Your future self will thank you come tax filing time! I personally use i-Cloud folders organized by property-> year-> month. Best wishes on your new venture!

@Trevor Richardson can you give me an example in the current market of what the price point is on a small multi (2-4 units) B class in Reno along with gross rents? Curious. Thanks!

@Justin Brickman what gross revenue to purchase price ratio can one expect in SA? Thanks.

@Randy Bayo man I would hate to see you sell a cash flowing property in a solid market like Sacramento that probably has a great interest rate, unless you have no other options. Can you find a way instead to increase your income? Work extra hours, raise rents, take up a side hustle, etc? Take that extra income and anything else you can squeeze out of your budget (tighten your spending) and apply the “debt snowball” method (ie Dave Ramsey style). Keep in mind if you do sell you will pay at least 8% of the sale price in transaction costs and there will be transaction costs when buying your next rental too, additionally interest rates are much higher now so it’s harder to find deals that pencil out. Selling the rental would be my last choice. Longterm, it’s preferable to punch your debt in the face and hold onto your property but if you do sell that will definitely jump start your debt freedom journey which would add a measure of safety for your family and peace for your pregnant wife (congrats btw!). Good luck with your decision.

@Mark Sanchez yes. Principal pay-down can be offset by the depreciation write off if you are cash flow neutral. If you study your Schedule E you will see that Rents Received is at the very top (line 3) which you are using to pay your mortgage (including the principal pay-down). All the expenses are below that including property taxes, insurance and interest (usually part of your mortgage payment and your mortgage company will send a 1098 with those amounts for filing). Depreciation is also listed as an expense (line 18). Principal pay-down is not an expense. So if you are exactly cash flow neutral and you pay $5k down on principal on your mortgage balance over the course of a year and your depreciation write off is also $5k your taxable income on the property will be $0. Formula -> Rents Received - all real expenses (not including principal pay-down) - depreciation write off = taxable income (line 26). Hope that makes sense.

@Ali Nichols what market/s?