All Forum Posts by: Jake Yates

My plan is to have a nest egg of money for each property in case things go wrong- long period of vacancy, roof/water heater/furnace replacement. I currently have 30k total saved for a rainy day, and I project to be able to save 3k/month if properties are vacant. With properties rented out and mortgages covered at minimum, I will be able to save 8k/month.

First property I have a year long lease in place and that cash flows about $200/month (expenses $1450, income $1675). My quadplex is still TBD (bought just last month.)- I conservatively project to break even (hired a property manager which takes away my cash flow. Sucks but I don’t have the time with my job to manage on my own)

I’m thinking to leverage for growth as I’m 27 and may as well take advantage of owner occupancy while I still have the flexibility to move often before a family comes along (if it does haha). Long term my goal is to quit my high paying job (great pay but long, erratic hours and stressful) by achieving 6k/month passive income. After quitting I would want to be doing real estate deals more full time and do something more enjoyable to supplement my real estate income (maybe teaching or personal training- tbd).

I’ve thought of buying 1-3 more properties within the next few years and then using the income from all my properties and job to hammer down the mortgages. This was a very long winded answer so I apologize for rambling but hope this gives you insight to my thoughts and plans 

I currently just bought my second property (a quadplex- 465k- that I am living in the basement so I was able to get owner occupant financing- doing one unit as a MTR and the other 3 long term. I am managing the MTR and hired a property manager for the 3 long terms) and am trying to set goals for my 3rd property- hopefully in about a year’s time. My first property is a single family home in a great area that I also purchased-200k- as an owner occupant for little money down and I am managing.

So both previous properties have really been nothing alike, and there are pros and cons to both. I am struggling trying to decide my next step- should I try to pay down my two current properties that I own as much as I can (I make about 150-200k a year). Or go owner occupant route again in a duplex/triplex. Or try to find a property I could BRRR?

Good news is I don’t think there is a wrong answer- but I do think there is a best choice. Any advice or insight is greatly appreciated!

Thank you for the response! Could I theoretically buy it as a residential and then transfer it to an LLC? I wonder if you sell it after two years then if you'd still avoid capital gains tax even though no longer in your own name?

 Hey Chris, I am in a similar situation as Daniel Ben-Hur. I am coming up on the two year anniversary of my first home purchase and have been trying to decide how to proceed next. Excuse me but I’m ignorant- could we buy another primary home with primary interest rates while renting out the original? Since it would be your “primary” residence one would be renting out, I would be surprised the bank/IRS would allow you to purchase a new “primary” home.  I’d think you can only have one primary residence correct?

I bought my first home in the summer of ‘22 and fixed it up to where I could, if i so choose, sell it for about 30k profit this summer (after two years to avoid capital gains tax) from what I invested into it. I currently have a cash pile of about 50k and am trying to determine the wisest/most efficient first step in my investment career. I’ve been reading and listening to podcasts and honestly am overwhelmed with how to proceed- choosing the wisest strategy when there are many different ways to proceed.

My current thoughts are to:

Buy a distressed property now under an LLC (although would be higher interest rates), fix it up, refinance, rent it out. Repeat (BRRR). And meanwhile, sell my primary residence this summer when two years have reached maturity, buy another primary residence (ideally a 2-4 unit small multifamily) rehab/refinance/rent it out while house hacking. Repeat the buying/selling of primary residence every two years while saving up for DP for separate rental properties as I can. I don't know if this is too ambitious/naive or actually possible.

OR (spitballing)

hang onto my primary properties every two years and instead of selling them, turning them into rentals. I understand some properties are much better rentals than others so I may be answering my own questions here as it’ll depend on whether my primary property would be a good rental or not. But the draw of leverage over time (putting 40k into 200k house that will be worth 400k in 20-30 years) has me reluctant to sell any properties that I may come to own.

I am leaning towards the first strategy but am open to any ideas or advice as I don’t have anyone personally to ask questions/bounce ideas off of- just books, the internet, and bigger pockets lol

With house prices being exuberantly high right now and seemingly on the market for a max of 2 seconds, what are recommendations for finding great deals in this market right now—especially for new investors?

Currently am looking on zillow and realtor.com, all potential deals already seem to have offers way above asking price ):

Thoughts?  Thanks!

@Tim Herman thank you for the feedback, I really like that quick tip about the 1% rule!

Another big obstacle I have when trying to analyze these properties is the amount of repairs the place will need (hard to tell from pictures, and even if I saw it in person I wouldn’t know how much it would cost to fix the specific issues). Any suggestions on how to accurately estimate without consulting a contractor or handyman?

Hey all, I’m super excited to get into the real estate world and have been reading and listening to any and all information I can get my hands on!  I want to start analyzing at least a few deals per week to get some practice and experience so I can get to a point where I can do them in my sleep and spot a good opportunity quickly.

Having said that, I want to be sure I am analyzing correctly! Perfect practice makes perfect, otherwise I will just be wasting my time.  Is there a group or place where beginners can analyze deals together to offer suggestions or critique?

TIA!