Mountain Tops and Camp Fires

The summer break has been in swing for about two weeks now and I’ve been reveling in it. My tenants for my first rental property are a dream. I haven’t heard a peep out of them and the checks just arrive in my mail box like magic.

Meanwhile, I’ve been having a good time. I have been binging on some video games. I’ve climbed a couple of mountains. I’ve attended a BBQ. I’ve been reading a fair amount. I’ve been catching up with friends around campfires and in hot tubs. I’ve been visiting with the older, mostly house-bound members of my extended family. And I’ve been looking for my second property.

I’ll probably be buying something in the next few months. I’m hoping to get a duplex this time. I plan to pay cash for it again and spend a couple months fixing it up. The units I’m looking at might fetch between $550 – $650/month per unit. Which would hopefully allow me to net around $900-$1,000/month after taxes/insurance and maintenance. Then, I think I’ll have just enough capital left over to purchase one more duplex just like it by next spring before I graduate, bringing my passive monthly net income up to about $2,600/month. Managing 5 units total shouldn’t be too taxing, especially if I get lucky with the tenants. I don’t think I’d want to deal with any more than that though. And the $2,600/month would allow me to save a substantial amount of money each month, allowing me to eventually get out of land-lording all-together. Not that I mind it, but in 5-10 years that will probably change.

Right now I’m thinking I might get a small RV next spring for me to live in full-time. I could park it at one of my properties if I get one with enough land. A friend of mine has also offered me free space in his large yard if I want to park it there for a year or so.

After buying two more rental properties and an RV I’ll be all tapped out of cash. But with the rent coming in I could then do what I’m good at again: saving. And a year or two after graduation start looking for one more house to pay cash for, but to live in, not to rent out.

In the meantime, I’m just enjoying all this time I’m swimming in.

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2 Comments

  1. Posted May 25, 2011 at 10:56 am | Permalink

    The idea sounds great, but the big hitch would be if a rent check were to stop coming in. My unsolicited advice is to not be completely tapped out at any time. I am, of course, partial to the idea of RV living. Feel free to be in touch with any RVing questions.

  2. Posted May 25, 2011 at 1:41 pm | Permalink

    I’m not worried. The rent would be diversified enough and I’d be saving about $2k month. So I’d have a new operating fund within just a few months, plenty of equity to borrow on if I needed or, god forbid, I could always seek employment for a few months.