All Forum Posts by: James Horner

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $90,000
Cash invested: $20,000

In 2015 I purchased two single family homes in Vermont for 90k both on the same plot of land. I invested $6k into the first home and rented it out in a month for $850 and the second home. I put $14 k into it over the course of a year then moved out of the property and rented it for $1200 a month. Since month one of owning this property I had tenants paying my mortgage. The bank required 25% down because I was 19 which I had from flipping cars. I still own these houses and have the same tenants.

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $90,000
Cash invested: $20,000

I purchased two single family homes in Windsor Vermont for 90k both on the same plot of land. I invested $6k into the first home and rented it out in a month for $850 and the second home I pulled an armature move and lived in it while i fixed it up. I put $14 k into it over the course of a year then moved out of the property and rented it for $1200 a month. Since month one of owning this property I had tenants paying my mortgage. I did this remodel right out of high school, purchasing the property with money i had saved up from flipping cars. The bank required 25% down because I was only 19. I still own these houses and have the same tenants in both houses.

Hyped to be attending my first BP conference! I will be driving down from Vermont and making a trip to New Orleans as part of a much needed trip after my latest BRRRR. After the conference I am headed to Flagstaff AZ to remodel a kitchen for a friend then I will be completely open to move to wherever seems right. Haven't pulled the trigger on the hotel in town but leaning towards staying at the International House Hotel because its half price and I'm a of a cheep guy :) Really looking forward to meeting new people and making connections. I have 10 units of my own and looking to expand!

Thanks for making this happen, I am a big Bigger Pockets fan and have applied a ton of the knowledge I have learned from this forum and the podcasts to my real estate endeavors. 

Hey Andre, 

Are your current rentals covering their expenses and paying themselves off? If so that's great, and if not maybe it would be worth seeing if you can find a duplex to purchase, sell one of the single family homes and 1031 exchange the profits into the purchase of your duplex which saves you from paying massive taxes on the sale of the property and puts it right into the multi unit that you are buying. It all depends on what your goals are but i have found whenever i have used hard money or privet money on smaller deals it tends to quickly eat up any of the profit or cash flow that i was hoping to have in the end. But that being said if you could find a partner to go in on a deal with you that may be one way to get started on buying multi family houses. If you find the deal people will invest with you. 

Hey Jake, 

If you work the BRRRR method correctly you should be able to come out with your money and hopefully equity in the deal. I really only purchase rentals that will cover themselves as well as cash flow which helps when the market changes and would strongly recommend doing the same. If you enjoy listening to bigger pockets podcasts the more recent podcasts have touched on this subject and how we are in a different market and ways to handle it/prepare for the future.

Hopefully that helped a bit. 

Hey Rolanda, 

I have had great luck with using Zillow to keep my leases and tenants rent organized so that you don't have to reinvent the wheel. Cozy is also a good site to work with. You can set up direct deposit so that your tenants money goes directly into your bank. I would highly recommend setting aside the rental income in a separate account to build up a bit of a rainy day fund. I usually save up the rent till i have around 5-8k i can set aside per unit just incase. 

Hey Grayson,

I am about to do the same thing! I just finished a single family that I am renting out the end of September and moving to my westfalia to some adventures. Technically when you fully rent out your property you will need to change your insurance over and you would have to change your residence. I just use a friend of mines property for that. I have heard some get a P.O box to have their mail sent to it. Nothing would have change with your mortgage. If you buy another property you would then have to plan to live in it for 2 years in order to purchase it with an FHA loan. Or you could purchase it through a commercial loan and that doesn't mean you have to live in it or have an LLC (tho that is the safest option) Your loan term usually is shorter and the interest rate tends to be a bit more but worth it in the long run if you are trying to grow.

@Sarah McCluskey

Hey! Looking at your deal my fear would be your initial repair costs becoming more than you the property is worth and eating up your cash flow. As a contractor when I hear foundation work needed that’s pretty major. Id say get multiple quotes. Foundation work and driveway work can end up costing way more and unless done right sometimes the contractors don’t actually fix the job. There are a lot of contractors that say they know how to work with concrete then two years later you have a major crack in the new wall and you see the same water coming in. I’d say keep looking at houses and running the numbers and if he dropped the price enough to make it worth it than great! If not there are always other deals.

Hey! I just put an offer on a property in Dover NH and I am hoping to get it for the price I offered because of its extremely strange lay out. This house was completely converted for a person who is hand capable so all of the door ways are sliders, there is a ramp in the house, the bathroom is super big and has a massive shower/tub, and the kitchen cabinets are lower as well as all of the outlet switches are lower on the wall. I have remodeled quite a few homes, but never one with this layout. I was wondering going at it as a flip, what would be the best approach for resale? Should I completely remodel the hone bringing it back to a standard lay out with 3 bedrooms, different kitchen and bathroom? Or should I embrace it being a handy capable home lay out and fix up and this it needs, clean it up, and try to get someone that needs all of that style lay out?

Thank you for your input!

I wish I could go back and encourage myself to keep at it. I wish I had known from the beginning that real-estate is the best form of income. I purchased my first property when I was 19 and my co-workers and old class mates all thought I was crazy for making such a big commitment so young and that I was going to be trapped paying all these bills. The exact opposite has happened. I am almost 5 years into owning that first property and it has produced over 80k cash over those years, payed for all of its expenses and given me access to a 80k line of credit. The funny thing is I've had the same people who thought I was crazy for jumping into real-estate tell me they wish they had done the same. Time goes so fast. Investing in real-estate can open up so many doors.