I started my investment journey in 2018 by investing in single family rentals (SFRs). My goal is to set myself financially free in the next 5 to 10 years with a portfolio of rental properties that can cover my monthly expenses.
Fast forward to 2022: I wanted to share my portfolio and some of the things I’ve learned along the way. Hope you find this helpful.
Property 1: Cleveland, Ohio
Acquired: 2018
Rent: $950 a month
Principal, interest, taxes, and insurance (PITI): $394 a month
Management: $80 a month
Cash flow: $476 a month
My very first deal was terrifying. Buying an item online was already hard enough. But buying a home online, sight unseen, sounded even crazier. After a year of analysis paralysis, I finally took the leap of faith after hours of podcasts and self-help books. This was the best decision I’ve ever made. What helped me was talking to property managers and other investors. They gave me a sneak peek of what the rental business was like and made me feel comfortable making this investment.
This property has a high margin and strong cash flow month over month. It’s probably my best performing asset on a month-to-month basis. I was fortunate enough to not (yet) spend a huge amount of capital expense (CapEx) during my length of ownership, which was a plus.
It’s an old building (built in 1950), and it has a basement. Basements always leak at some point, so I’ve learned that snow + basement is almost a guaranteed expense at some point. I’ve had some minor leaks here and there, but nothing out of the ordinary.
Property 2: Atlanta, GA
Acquired: March 2019
Rent: $1,150 a month
PITI: $762 a month
Management: $100 a month
Cash flow: $288 a month
My second deal was a little easier, but I got lucky on this one in terms of timing. The market was growing, and the property had a long-term resident in place (still present to this day).
This was my strongest property in terms of appreciation, but my margins were low. Almost every year, there was a large expense (furnace, new chimney, plumbing issues) that kept me from making any consistent cash flow.
I plan to sell the property this year and do a 1031 exchange.
Property 3: Cleveland, OH
Acquired: September 2021
Purchase price: $105,000
Down payment: $26,000
Initial cost to get rent-ready: $8,000
Rent: $1,300 a month
PITI: $636 a month
Management: $108 a month
Cash flow: $556 a month
This is the newest home I acquired, so it is too soon to give a lot of details. I’m working with the same company that manages my Cleveland property, and they’re great. Things are going well so far—more updates to come!
Takeaways
Whether you’re seeking appreciation or cash flow, you’ll need to learn the pros and cons of both to decide what’s best for you.
Owning real estate is a business. Set up your business for success by finding a quality property manager, and speak to a few lenders along the way. Your team will have a drastic impact on your bottom line.
Real estate is not cheap. The high cost in repairs, closing costs, and debt can add up quickly if you don’t account for these items. Unexpected repairs will come up at some point, so make sure you have the cash on hand to cover your expenses.
I hope this glance into my portfolio provides some insight into a real-world example of real estate ownership.
Feel free to connect with me on LinkedIn—I would love to learn about your investing journey as well.
Disclaimer: Statements reflect actual experiences of an individual who used the services of Roofstock and do not, and are not intended to, represent experiences that consumers will typically achieve. Roofstock makes no representation, warranty, or guarantee about performance or results that may be achievable using its services.
