All Forum Posts by: Rodney Love

Thanks for the quick reply.
What companies have you bought that you would recommend others?

Hi Rodney, 

Real Estate is a long term game especially in this market as its challenging to find actual cash flow properties. Is it possible to replace your income? yes it is. Rentals will take the longest but also the least amount time spent on them in regards to managing. Air bnb do take more work in regards managing and preparing as your basically running a hotel business but higher probability to cash flow more than rentals. Once you have your systems in place running your air bnb will get easier. Fix and Flips if done right have the highest return in your investment but also take 6-12 months to complete and get your return. One deal can be your salary for the year but its also very stressful and takes a lot of your time when working with fix and flips. Same with Fix and flips once you have your systems in place it can be very lucrative. 

@Albert Bui @Matthew Kwan @Kin Meng Sio

I think the best way to use real estate to escape the rat race is also the best way to get into real estate, which for 90% of people is house hacking. Preferably buying a duplex or fourplex with an FHA loan (96.5% financing) or some banks will go up to 95% on similar properties with conventional financing. Then, when you move out, hold that property and buy another one to live in to take advantage of homeowner terms. (If you used FHA to buy the first, you will need to refinance as you can only have one FHA loan at a time.)

This "hop scotch" method allows you to build a decent portfolio that you can later tap the equity from with refinancing and move into strategies like BRRRR and what not.

We can rephrase this question: How do I turn my 70000 into approximately 2 million so I can retire.

The answer is leverage, forced appreciation (value add work), time, operational excellence and risk management.

There are several strategies, but the two most recommended are BRRR and househacking.

Househacking is nice because you get favorable loan terms and higher leverage than investment loans. You also lower your own cost of living so you can invest more.

Rehabs are nice as well because you have a lot of value add work at the beginning which allows you to develop equity more quickly.

Strategies like rent by the room, and short and medium term rentals can generate higher returns.

Ultimate you probably want to combine all these strategies, at least in the beginning, to supercharge your initial returns before moving to a more sustainable model. This might look like buying a duplex, rehabbing it while living in it and renting it out by the room as able and then repeating the next year.

@Rodney Love

Real estate investing is a common means of escaping the 9–5 grind, although the methods used to do this vary greatly depending on the investor's background, abilities, risk tolerance, and the health of the market in the desired investment region. Careful planning and strategy selection are crucial when starting with an investment of $20,000 to $70,000 and trying to replace a $7,000 monthly salary. What each of the aforementioned strategies may accomplish in order to reach this aim is briefly summarized here:

Fix and Flips: Your initial capital could serve as a down payment and renovation fund for a single property to start. Success in this area requires a keen eye for undervalued properties and a solid understanding of renovation costs and ARV (After Repair Value).

Tax Liens: With limited capital, investing in tax liens can be a way to start small. However, turning tax lien investments into a steady income stream is less direct than other strategies and might not quickly replace a $7,000 monthly income.

Mortgage Notes: Investing in mortgage notes can provide a steady income stream if you acquire notes at a discount. However, building up to a $7,000 monthly income would likely require a significant portfolio of notes, more than the initial capital might allow for starting.

Rentals: With $20,000-$70,000, you could potentially use leverage to acquire one or two properties in markets where this capital suffices for down payments. Selecting the right location and property type is crucial to maximizing rental income and minimizing vacancies.

Airbnbs: Your initial capital could cover the down payment on a property in a location with high Airbnb demand. Success requires excellent hospitality and marketing skills to maintain high occupancy and nightly rates.

Achieving a monthly income of $7,000 requires a mix of strategic investment, reinvestment of earnings, and perhaps most critically, time. It's also beneficial to continually educate yourself on real estate investment strategies, market trends, and financial management to adapt your strategy as you grow your portfolio. Networking with experienced investors and leveraging professional advice can also significantly impact your success.

Good luck!

The strategy you chose depends mostly on what you will enjoy most and will be good at. AirBNB is really a hospitality business more than a REI activity (it just uses real estate).

I like long term rentals most because it provides predictable, stable income and that suits me and my wife better. Our short term rental (airbnb) is a little more exciting but causes me more lost sleep due to seasonal fluctuations.

Consider your risk tolerance, try a little of a few strategies and figure out what you like. Any of these can be exited if you decide to, then the capital can be moved to the one you like.

I have 12 Airbnbs an 7 long-terms.

Make sure when youre constructing how you want your life to be that you don't change the 9-5 for a full-time job managing Airbnbs.

Airbnbs are much more hands on than my long-term rentals. 

I would look into buying small businesses. Real estate everyone is trying to make a buck in, and it makes the "market" unsophisticated on the buyer and seller side where each is trying to push and unfair deal most of the time. You can buy a business with that money and replace your income fairly easily compared to buying properties. You need much more capital for real estate, as it is a wealth protection and cashflow engine for large sums of money when done right IMO