All Forum Posts by: Shane Wolf

Will be joining tonight. Looking forward to meet everyone. 

Your call on how you want to move forward, each person has their own strategy they need to be comfortable with. 

Also think about if you want to use the equity in the property you have to pay to get it back out. If you are worried about the doom and gloom, build a bigger reserve to carry you through. 

Would come down to math for me. How much can you get with a cash out refinance for what cost vs how much can you get for a heloc after a normal refinance is done. When I just did it for my situation the standard refinance with heloc later was better. 

As for paying off your mortgages quickly, there isn't good reason to do so. Secure the low interest rate and let your tenants pay it off. Use the extra money you would have been paying down the loan with on investments (whether it be more properties or other avenues) to get a bigger gain. 

@Corey M. Ali Boone at Hipster investments does this. Recommend checking her out.

The first part is to understand what your buying criteria is. Type of properties you want to buy, what is your price range, what is your strategy, etc.  Once defined, there are many sites to put the numbers into and find what the cash flow will be, including ones on bigger pockets. Put in the numbers and see if they match your criteria. 

If you have not attended a bigger pockets live webinar I suggest doing so as Brandon covers this live to help give you a better understanding. This week's webinar is on your exact question. 

Good luck. 

Thanks @Joe Villeneuve, I have the end goal, the reverse engineer part is tripping me up. For example purposes with easy numbers lets say the end goal is $10,000 per month in net income. If I purchase $100k properties which nets $200 per month in income, that would be 50 properties I would need. If I was able to purchase 2 of $100k properties a year, it would take 25 years to get to $10,000 monthly.

The missing parts in this equation is property value appreciation and rent growth. Even at a conservative 2% appreciation and rent growth (know we can debate the numbers, just illustrating what I am looking to solve for), property #1 would be valued at $122k after 10 years and its monthly net income thanks to rent growth would be $400. After 20 years, it is worth almost $150k and the monthly net income grows to $650. This significantly changes what is needed to get to the end goal.

First house is easy to figure out, the challenge I am running into is how does it change when now I get two more houses in year 2, two more in year 3, etc. If after 10 years have total of 20 houses, trying to project what the net income and net worth of it all would be.

Know there is a lot of assumptions and guesstimates, but trying to see what the potential could be.

Hey BP, I am getting started with real estate investing and personally can see the power and financial benefits of REI over other investments like the stock market, however my wife has reservations. Part of what I want to cover with her on why this is a good strategy is what the long term financial benefit is, however I am struggling on building the model out when you factor in all the financial benefits of REI (cash flow, property appreciation, rent appreciation and equity increase). I know appreciation is not guaranteed but at least want to put in some conservative numbers.

I can build out financial projections with these factors for a single property but layering in additional properties each year for the next 20 years has stumped me. Have any of you found resources that have this mapped out or built one you would be willing to share?

Starting out investing in single family rentals and looking for a real estate agent in the Durham and Raleigh area. Targeting BRRRR properties that will have an ARV of $125-$175k. Any agent recommendations would be greatly appreciated.

@Stephen Lee

Total cash invested would be the cash you have into the property still once the refinance has been completed. Personally I would not get hung up on what this percent is, instead for us on how much cash you were not able to get out of the property after the refinance.

Example, between down payments, repairs, closing costs, etc you have $30k of cash into a property you paid $50k for. The after repair value comes out to $100k and you were able to refinance at 75%, making you new mortgage $75k. Take the $80k you intially purchased it for plus cash invested, subtract out the $75k the bank is now giving you leaves $5k cash invested still.