It's finally here!!

[Arif]

I've been lurking for awhile (other than when JG started talking about real estate deals). My wife and I are 33 and 32 and both in the military. We have decided to hang up the uniforms before retirement and go out on our own. Our plan is to semi-RE now instead of working 9 more years till retirement. We'll be moving to Panama on December 12 and living off of our rental income. The property management company will take over the rentals on the 5th and I'll hope for the best with them. All of our bills are paid off (cc, auto, etc.) except one cc at 2.9% interest. We saved a little over one year of expenses just in case and took out ELOCs on four of our properties as a back up for the business. This has been a nerve wrecking process and as the days draw closer it seems like our "to do" list gets longer and longer. The movers will be here in two weeks and we are ready to go. It will be strange renting from someone while we are in Panama even though we have 30 rental units in the States. We plan to build a house on the beach in a year so that is why we will be renting. Sorry to ramble just wanted to share.

 

[Sisyphus]

CONGRATS!

Keep us updated on how things go. It is ironic that this morning I woke up to gray, winter skies and depressing weather. My wife and I were just joking about how we should just move to somewhere in Central America and live off our savings. Then I stopped in to check the forums and saw your note!

We're roughly the same age as you, but unfortunately, we don't have 30 rental properties to live off of. Only have one so far. I would be interested in your comments regarding having multiple rental units like you have. We have been considering at least one more, but I have the typical concerns regarding time required and ability to turn a profit monthly. Did you invest in mostly small houses, condos, duplexes or multi-unit buildings?

In any case, congrats again! Best of luck with your move!

 

[Arif]

Sisyphus,
Right now we own a little bit of everything from homes to a 5 unit. Being somewhat organized has helped a lot. The hardest part for me is turning them over to a property manager. Despite chasing rents and evictions I enjoyed helping people that needed a hand. We acquired our units while working full time and farming out most of the maintenance. In order for us to acquire more units we have to hire additional help wether we were moving or not. My advise is only buy great deals even if that means only buying one or 2 properties a year. Five years ago we made a decision to aggressively buy real estate instead of maxing out our retirement accounts (which at the time only included IRAs...before TSP was available to the military). We didn't buy in areas that were appreciating by double digits we just found properties that owners no longer wanted and were willing to give away at 70 cents on the dollar.

We started out with one duplex seven years ago and just kept adding units with the money we were saving by LBOMs and the rental income. So just keep on going and NEVER pay retail.

 

[Spanky]

Arif,

Great. Congrats and have fun living by the beach.

Spanky

 

[wildcat]

Arif -

Congrats and enjoy. I think you nailed the key to real estate investing

we just found properties that owners no longer wanted and were willing to give away at 70 cents on the dollar.....So just keep on going and NEVER pay retail

I think too many perceive RE investing to be a piece of cake but like anything else if you overpay you don't always walk away with a profit. I think the 1% real estate rental rule is a decent place to start as well as the NPV equation on Excel.

 

[Arif]

Thanks.
I've found in the past that the cheaper you can get a property the more mistakes you can make (and you will make them) and still come out with a profit.
Now we'll see if the real estate annuity we've built will throw off cash like ENRON or Berkshire Hathaway

Another good strategy is buying homes to flip (as long as you follow rule #1) and use the proceeds to fund retirement accounts or long term rentals. Not hard to do just research and watch your expenses.