With the countdown to our MLS list date nearing the end, we are more present than ever to our goals. From the beginning we established short & long term goals that would feed into our larger vision of our “10 year plan”, if you will. Sharing our goals with you is a very scary & vulnerable thing. I often think “what will they think if I fail” or “what if I can’t do it or I change my mind?” Well folks, this house has changed me in many ways, and one big way is that I’m less afraid to fail. I now have the awareness that it’s okay to change your plan. So here I am, sharing my big financial & career goals with you.
A lookback on this project:
There are a few things that I would have done differently if I could go back in time before jumping into this project. First– I’m not going to get into financials, but we did not flip a house using the traditional methods of capital which added a lot of stress to us currently. I know it will all turn out, but in some ways it backed us into a corner. Second- I would have chosen a property that could have been flipped OR rented. Then we would have had 3 options: sell, rent, or refinance (technically 4 because there is a cool cash-out refinance option for rental properties). We purchased this property in our names & homesteaded it for tax purposes because we are living in it. We had to set ourselves up for success incase we couldn’t sell. Part of me wishes we didn’t move into this house during the renovation, but again, part of me wouldn’t have changed a thing. The way this experience has truly shaped me I cannot even begin to describe. I am changed emotionally, spiritually, and physically. It stripped away all of the things I clung to for comfort & showed me true gratitude to the little things. I will never be the same and I would never change that…. But I also wouldn’t do it again…. Maybe….
So What IS Next?
Well…. It depends on whether or not we can sell this house for what we want. We don’t need to sell it, we have other options (see chart above) and we are perfectly fine with refinancing & living here for a while longer. If we do sell then things are going to get a little crazy.
- If we choose to 1031 exchange this property then we’ll have 45 days to identify another “like-kind” property to renovate. We’ll probably have to move into it if we go this route. There are many things to consider, although it’s nice to roll your capital gains tax into the next property. We may scramble to identify a “good” investment property and back ourselves into a corner. Especially considering the COVID-19 Pandemic & it’s effects on the market.
- Another option is the ‘BRRR’ investment strategy in multifamily properties. BRRR stands for: Buy, Renovate, Rent, Refinance. This one is actually what I’m personally leaning to. We find a quadplex that needs some work, but in a “good” area (because we’ll be living in it). We move into one unit, renovate each unit one, by one, rent them out at current market rent values, then cash out refinance & do it all again. The perks to this one is technically we will be living for free & it will feed into our long term & short term goals. The issue is financing. If we don’t sell this house for what we want, then we won’t be able to invest into multifamily. They’re expensive y’all.
- The third & final option is cashing out & renting for a year to save money and re-evaluate our plan. We aren’t sure what the market will do, especially in the current circumstances. Alton has one more year to get into the Air Force as a civilian fighter pilot. I don’t want him to regret not putting everything he’s got toward reaching his life’s goal. Sure the world is his oyster and he has opportunities galore, but I don’t want him to look back with regret.
What are some of your goals? If you have any questions or want to talk more about real estate investing shoot me a DM on instagram!