What’s up, everybody? Matthew Whittaker, here. I’m doing questions owners ask.
Today’s question is:
How do I build a portfolio of rental homes?
So this is something I’ve done. I actually started and bought my first rental home when I was 23-years old. And so this is something I’ve been doing for a long time, 15 years actually, in October. So that’s pretty exciting to me that I’ll be have done this for 15 years.
This first thing
I would do is define your area. I always tell people when I’m getting into buying houses, or if you were getting into buying houses and I was giving you one piece of advice, I would tell you to focus and become an expert on one certain area.
I see a lot of people that get, kind of, what I call Walmart disease, where there’re just an overwhelming amount of houses out there and it’s hard to sort through all of them. I would find a specific area and become an expert on that.
that I would do is to be consistent when you’re looking in that area. So become very disciplined about looking. So number one, you know the area. Number two, when you see a house come across that is in that area that you know’s a good deal, that way you can act very fast.
So being consistent, looking on a daily basis, or at a minimum, every 48 hours of all the new houses coming on the property will help you buy more houses and build a portfolio.
Purchase consistently. Don’t do one and done. You know, I always tell people, hey, get to ten houses because at about ten houses this business starts to kinda take care of itself. The cash flow takes care of itself. And it becomes a very kinda self-sustaining business.
Now there may be a time you have to put a little more money into it, but generally speaking, the cash flow takes care of itself at ten or more houses.
And then the last thing
I would say is think stabilization. Any time you kind of get off-kilter don’t try to keep buying, buying, buying. Stabilize your portfolio. Typically somebody may get off-kilter from a cash flow standpoint or get too many houses going at one time. Think stabilization.
The whole idea of rental property is that it’s kind of steady-eddy stable business and if you think stabilization, you’re never going to go wrong.
Again, Matthew Whittaker. Questions owners ask. And the question today is: How do I build a rental portfolio?