All Forum Posts by: Jon R.

@Jon R.

BRRRR is great. I'd argue, though, that BRRRR is haphazard, time-sucking, and disjointed =-)

BRRRR is your best bet. You won't get taxed on debt, you will be able to buy a property every 6 months. Rents will keep the property afloat but you probably won't be making enough cash flow to retire. I say flip 1 for every 2 you BRRRR

@Jon R.

Hey Jon,

I'm with you starting again at 58.

Praying it's not too late.

Where in the bay area are you?

I'm in watsonville near Santa cruz.

Recently connected with a couple of others in my local area through BP. Hoping to get together with them.

I've been in residential remodeling forever.

We've recently purchased a tri and duplex oos.

@Jon R.

where on the scale of passive vs. active do you want to be?

a lot of the advice given to you in this thread seems to be "invest successfully, and you'll be successful"

age does not dictate strategy

small, well managed properties can be profitable

so can large buildings

i do think it will be tough, in today's market with cap rates compressed, to immediately jump into a large MF on your first deal

thoughts?

Quote from @Jon R.:

Hi all,

TLDR:  I'm 50 and want to scale quickly and be FI in five years. For my first MF, should I start small with a duplex or jump straight to large MF since I want to eventually get there anyway?  I.e., is there value of learning how duplexes work before going big?  Seem like completely different beasts.

Long version:
My wife and I have had a primary residence for many years, 401ks, the traditional plan. W2 employees, stumbled on BP, listened to podcasts, got my wife onboard, got a heloc, analysis paralysis. The usual. That said, I'll be 50 next year so time to get moving.

Goals:

1) FI in five years / ability to leave W2-life if we choose

2) Greatly reduce tax burden (mostly traditional 401k/IRA $ vs Roth)

3) Have a SCALABLE / manageable business. I don't want to build a haphazard, time-sucking, disjointed business.

4) Teach / show / prove to my teens the power of REI

5) Bonus goal: Have one or more properties appreciate significantly over the next 4-5 years. I say bonus because I know I can't control this.

Strategy:

I can't say I'm passionate about MF but it seems like the most logical way for me to scale up quickly given my age. 

Next major step for me is BPCon so any feedback/guidance before then is tremendously appreciated. 

Kindly,

Jon

For more than 20 years I specialized in flipping mobile homes in parks. The low initial investment, quick cash, and eye opening profit margins allowed me to invest in, and now own, a nice portfolio of income producing real estate. The vast majority of investors don't understand and are quick to dismiss the potential. The result is very little competition and unusually good numbers experienced in this unique niche.



For more than 20 years I specialized in flipping mobile homes in parks. The low initial investment, quick cash, and eye opening profit margins allowed me to invest in, and now own, a nice portfolio of income producing real estate. The vast majority of investors don't understand and are quick to dismiss the potential. The result is very little competition and unusually good numbers experienced in this unique niche.

Quote from @Jon R.:

I'm 50 and want to scale quickly and be FI in five years. For my first MF, should I start small with a duplex or jump straight to large MF since I want to eventually get there anyway? 

I always tried to buy what was under the radar,  sell what was hot.  I'm 50 and just sold what you're looking for after learning and consolidating smalls from mobiles, houses, plexes over 20 years.

To skip or at least accelerate a 20 year learning and career curve, I'd most likely specialize in a littler/smaller known niche of RE. Something in your area nobody is talking about. 

I started looking into marinas for instance. We chartered a fishing excursion and all I saw was a huge number of boats paying slip rent.  Outside the box.

Marinas themselves aren't the suggestion. Thinking/ looking elsewhere is.

After selling two of my larger mf communities this year at ridiculously low cap rates and seeing two come on the market (a few months late IMO) this week for the first time since '98, my money's on sellers being the smarter timing party in the larger mf space.  I've 'saved' these to get updated on the inevitable price drops.  Pardon- price adjustments LOL. 

Find an asset class nobody's talking about and buy off-market.

@Jon R.

Having pursued real estate investing for over 25 years, my journey can be aptly described as "haphazard, time-sucking, disjointed" but wonderful.  

Although some are "struck by lightning," I believe a 5 year plan to financial independence is unrealistic, unless you are happy living in a hovel and eating out of a can.   

Much of the joy in this business is in the journey.  If you hate the journey, you will have a tough time reaching your goal.   

Hey Jon!

First of all, CONGRATS! 

What a beautiful decision you made. I am hoping for the best for you and your pursuits. REI is so awesome, I swear. No matter what age, ethnicity, handicap, or circumstance we find ourselves in, REI is so versatile and able to provide freedom at any level for anybody.

You have a lot of great advice on here already, but one strategy I would consider is short-term rentals. It does take a lot of work compared to a long-term rental. But depending on your personality, your skillset, and your motivation, it might be worth it to explore. Not only is it good to diversify your portfolio, but STR's can satisfy all five of your goals, especially if you can leverage vacation home loans for 10% down. Eventually, you can transition to DSCR loans when you reach your loan limits, but by then, you should have enough cash flow to purchase a property every other month if you wanted to (depending on what market you buy in!).

You can self-manage and achieve this goal faster using the methods Avery Carl taught us about, or you can hire a PM, for a more passive route, but that would take a little longer.

Some great resources that have helped me learn about this stuff:

https://store.biggerpockets.co...

https://www.youtube.com/c/Robu...

https://www.youtube.com/c/TheR...

Quote from @Jon R.:

I started investing at the age of 46. In six years I've build a portfolio that earns me $150,000+ a year. However, I started before the market went crazy. Your experience may be a little slower based on current market prices, but it can be done.

Definitely look at larger properties, particularly mobile home parks and self storage where you can scale faster and get a better return.

Hi Jon, Congrats on your decision to invest in real estate.  I highly recommend the Janesville-Beloit, Wisconsin area for investing.  There is a steady supply of great deals with consistent 20% cash on cash returns.  Feel free to give me a call if you want to discuss.  Good luck.