The Path to Buying our First Rental Property

About a year ago I started reading and learning a little bit about real estate.  I think one of the blogs that first got me interested in the topic was Afford Anything  from Paula Pant.  By that time we were already doing our investing towards financial independence mainly through our 401Ks and other post-tax accounts.  But this was one of the first times that I came across an FI blogger that achieved financial indepence through rental properties.  I then came across a podcast from Brandon at MadFientist where he interviewed Josh Dorkin from BiggerPockets.  Therefore I started going down that rabbit hole and  listened to a lot of their podcasts as well as learning about the different real estate strategies discussed.  Flipping did not attract me because we already both work 40+hour jobs and we have a toddler so time is limited.  Wholesaling is marketing intensive and I don’t exactly understand the steps involved.  But I did find rental properties intriguing for a few reasons.  I like the idea that you actually own real estate, the tax benefits, maybe some appreciation but above all the cashflow.  Like I mentioned we have a toddler and we’d like to spend more time with her.  My wife is not in love with her current job and has a bad commute to deal with each day.  Therefore I brought up the idea of rental properties to my wife with the goal of building a little bit of cashflow so she could cut back on her hours.  We love the idea of starting this business together and it can fit easily into our financial independence plan.  Often rental property income is referred as “Passive”  but we understand that it won’t completely be especially since we plan on managing it ourselves.

I can’t remember which episode of the BiggerPockets podcasts I heard this from, but someone said the best thing you can do is to buy that first property and gain an education  That resonated with me and was determined to get our first deal done in 2017 if the right deal came along.  We had been saving a little bit of cash the last few years in case an opportunity came up.  Every once in a while I would doubt our decision, why not apply that chunk of money to our own mortgage or simply buy more index funds.  It’s about the timing for us, we are at a point in our lives where we either needed to do this now or wait 2 or 3 more years.

Fast forward a bit and we actually acquired our first duplex earlier this month.  I plan on documenting the process as much as possible since we are completely new to this and hopefully we can help someone else in a similar situation.  I will update the blog with the rehab cost and time spent to get the property to market.  I will also share what our expected returns are and how that will compare to the actual number once rented each month.

Now back to you, let me know if there are anything in particular you would like to know.  Let me know in the comment section and I will help any way I can.

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