Originally Posted by
Hubcapped
If this is true, you can have approximately 40 rentals when you retire to be able to give to your kids in a trust. I have 12 units, 4 rental properties. As soon as I am able I refinance one (usually takes about 5 years per property) and buy the next one. Use a 1031 exchange. Atm rates are too high for my taste but as soon as they drop I have one of mine earmarked for a cash out refi. You also need to find a real estate agent you love.
Areas I’m looking at now, are south/west salt lake. St. George, Boise suburbs. Lots of movement from the coast as big money comes in and pushes people east. This works for me. On average I am pocketing about 2.5% property value in cash, +equity in rising value after all overhead.
Makes sense, Non-socialist states, where the refugee socialists are likely to flee and drive up property values and rents.
Originally Posted by
Hubcapped
You can’t do this in areas that have already popped. Find an area that is 3-5 blocks from the “nice part” and watch what happens in 2-3 years.
This too. I correctly did this with my first property, it took about 15 years, longer than I expected but it did get there.
Originally Posted by
Hubcapped
3) I buy middle level units. Somewhere in the realm of 2k per month atm. I target working professionals in their late 20s and early 30s. They pay their rent on time. Also, when times are good lower income folks want to move in, when times are bad higher income folks downsize and want to move in. I’m never short of applicants.
Yes your tenant demographic makes a difference, most especially if you manage it all yourself and hope to have any QOL on your days off. Slum lords actually have higher margins but they have to deal with a lot more BS. Wealthier tenants have high expectations, are used to getting what they want, and know how to work the system. Concur with mid-level.
With more than a couple units I'd probably outsource the management too. That can actually mostly pay for itself... professionals can often get higher rent with less vacant time, and have volume accounts with Mx pros. I've had tenants call about broken garbage grinders, etc. If I'm on the road I'll just tell them to call a plumber and give me the receipt. With a manager, his plumber will go in and find the fork the tenant dropped into the grinder. Then the manager charges the tenant instead of charging me.