Show notes
Today we will discuss how I built a rental business while at a relatively low-paying job. I will also talk about some things I have learned about rentals along the way. We will also cover our usual Monday segments.
Featured Event: Self Reliance Festival: https://selfreliancefestival.com/?aff=nicolesauce
Sponsor 1: Permies.com
Your ref code to promote the Kickstarter:
https://www.kickstarter.com/projects/paulwheaton/low-tech-0?ref=9bl6gk
Details on the earlybird rewards:
https://permies.com/wiki/earlybird
Sponsor 2: John Pugliano and the Wealthsteading Podcast: https://bit.ly/3oPLTmr
Livestream Schedule
- Monday, 3pm, NOTE: I changed the time due to my evening Choir schedule
- Tuesday, 12:30pm: LIVE with Pat Watson of Uncensored Tactical and John Willis of Special Operations Equipment
- Friday, 10:30am: Homestead Happenings - We have BABY SHEEP!!!
Tales from the Prepper Pantry
- Really need to kick Up cheese production for the winter
- So. Much. Food.
- Power Pantry Webinar
- Weekend Eaten Up with Roaster Repair- so less forward momentum on harvest. Creek Mint
- Fall restock will happen in the next four weeks or so (How we do this)
Weekly Shopping Report From Joe
I gassed up on Friday, and spent the usual $3.899 per gallon of untainted regular at Weigels.
Traffic was moderate, and the weather was nice.
All of the drink coolers are working at Dollar Tree, and they are well-stocked. The health aisle looks pretty full too, with a good supply of generic OTC meds.
A 2x4x8 remains at $3.68 in Home Depot. I'm not sure I saw any AA or AAA Lithium batteries, but they have plenty of alkaline, and they do have Lithium coin cells and CR123s. The store was normal-busy.
Aldi was last. We found what we wanted. They even had a little bit of 70% chocolate in stock again. Staple prices were: milk: $2.82, eggs: $1.03, heavy cream: $4.69, butter: $3.19, OJ: $3.19, bacon: $3.99, potatoes: $5.99, sugar: $3.09, flour: $2.19.
Frugality Tip from Janet - who just started a sewing podcast
This one can help keep things tidier in your bathroom too!
I save little slivers of soap in a jar in the bathroom. When I make a batch of homemade liquid hand soap with a bar of grated soap and a gallon of water, I add all the little slivers to the batch and use them up that way.
Operation Independence
Three sheep were born, Lamb Chop and Two Unnamed Girls!
Main topic of the Show: How I Built a Rental Business with a $25,000/Year Job
It was the early 2,000s and I was living in an apartment with a roommate. I was in my late 20s and had rarely lived without roommates - that was how I made money work.
Background:
- Grew up helping Dad with rental properties
- Took jobs cleaning and painting in college because they were flexible
- Was an excellent tenant
- KNEW I wanted to eventually have rental properties
Learning the Trade: Befriended someone who managed several rentals and helped with property management.
- Standardized agreements
- Standardized paint colors
- Standardized policies/template agreements
- Garbage disposals, ceiling fans, and appliances
- The "Move in fee'
- Month to month versus leases
- Screening services
Mentorship and My First Home
- Qualified for $150k on my 25000/year salary with good credit
- Could only really afford 100k when I looked an finances
- At this time, houses in the "wrong" part of town fell into that category
- How I got the first home
- How I kept the first home (Roommates)
- Remodeling myself
It was 2006 and the mortgage market was playing free and loose with loans – New state, Tennessee. I found myself becoming a landlord across the country.
Established a long term goal: ongoing revenue in old age, 10 units
- Mid 30s and still had roommates
- Went in on a duplex in Nashville with a 50-50 partner in an undervalued part of town. It needed work and updates.
- Established a property manager I trusted (words on this)
- Bad experiences happened when
- I let folks in with former evictions
- I let folks in with criminal history
- I let folks in with bad credit
- I did not check monthly
- Bought the Holler and my former Nashville Home became a rental - the NEW DAWN
- Standardized policies
- No exceptions to screening rules
- Hired a lawyer for rental agreements
- Standardize paint colors, ceiling fan, garbage disposal, appliances policy
- Immediate eviction notices for late rent
- Philosophy: strict adherence to contracts from the start
- Financial goal per property: Positive cash flow, not long term asset appreciation
Today, we rarely have issues and use time between tenancy to implement maintenance. The approach is that it is better to be empty a bit longer than to have a bad renter experience. There is still improvements to do on each property and we update things as extra budget happens.
Speaking of finances: for 20 years, most money from the rentals goes back into the rentals, which are nicer than my personal home. By choice. To build this long term into ongoing revenue for when it is harder for me to work.
Today I have 4 and if you think about it, by having Tactical in my guest house, I STILL live with a roommate. In my 50s. Because that is one of the BEST ways to quickly improve your financial situation quickly and leverage the money toward rental property acquisition.
Make it a great week!
GUYS! Don't forget about the cookbook, Cook With What You Have by Nicole Sauce and Mama Sauce.
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