All Forum Posts by: Kelsey Folger

Ultimately, we decided to manage the property ourselves so that has helped significantly with costs. We have been netting around $500 per month after expenses. All tenants are on long-term leases that have been renewed for another year until 2021, they plan to stay long term. Overall it has been a pleasure to deal with and tenants have been great. Not the best cash-flow possible, but I have only put in a few hours per month managing most of the year so I consider it worth our time, especially as a first investment property to learn from. 

Our stories sound very similar. My husband makes about 50k at his job, we had about 30k saved up to invest. We decided to start with small multi-family last year, so we've purchased 1 triplex at 139k (nets $500 mo) and 1 quadplex for 145k that nets maybe $900 per month. We live in Michigan.  

We have found that our least favorite part of the process is dealing with closing the mortgages and getting a system in place for utilities, etc. So, I wouldn't want to close 7 deals in order to accomplish what we have in 2. But maybe you don't mind paperwork, document prep,etc. that is required to close each deal. 

Best of luck with no matter what you decide.  

Our first goal is to replace my husband’s income from his day job, around $3000k per month. We are halfway there with 7 units. We just started investing in the past year at age 29.

Our next goal would be more units, probably 5000k net per month, which would add more security to consider leaving his job.

Ultimately, we hope to build wealth and teach our four kids about the value of hard work and entrepreneurship. Teach them how to bless others because we have been blessed. Teach them to value even the lean times (like now with this pandemic).

@D'Andre Byers my husband and I got married 8 years ago at 21, we just bought our first triplex at 29. We have 3 kids 5 and under.

I’d say we have definitely matured and figured life out together in the past 8 years and spent all of our 20’s making life choices together.

I’d say give her time to come around. Read some books together, listen to a podcast, etc. respect her opinions so that you can be business partners down the road.

What appeals to me the most about seeking financial freedom is being able to stay home with my kids, someday buying a cottage to enjoy, and being able to travel without sacrificing our life savings.

@Elliott Elkhoury thank you so much for the time you put into your reply. Although we are now under contract, I will definitely hurry along the splitting of the utilities in order to get a better return. I am also looking into the possibility of adding another bedroom in one of the units after it turns over in order to command a higher rental rate. I truly appreciate your expertise.

@John Barrows thanks, I will look into that!

@Bjorn Ahlblad

Thanks!

We will be splitting the electric as soon as possible, then waiting until the leases expire in April to pass the monthly bills to the tenants. Would you then lower the rent to reflect the extra expense they would be paying in order to offset the cost?

@Tim Herman thanks for your reply! I hadn’t tried the BP calculator, just one I found online. I’ll definitely look into the BP one further!

@Justin Kurpius although we plan on holding it long term, we are primarily focused on cash flow.

We are nearly under contract for our first rental property! Here are the numbers. Deal would be all cash (can’t finance until roof is replaced)

Triplex in Northern MI

Pay:139k

Needs roof:10k

All units have long term tenants: gross rent 2,100 per month

ALL utilities included —-we are looking to split electrical first

Property manager will take 10%

Property taxes $3,200 year

Utilities $7-8k a year

From what I can gather, the property will cash flow at around $300-400 per month until the utilities are split.

Would you do the deal? Any advice as a beginner?