Living for Free & Earning an Income off Your Primary
What if instead of going to school, getting married and buying that dream home with the white picket fence you redefined the American Dream? That’s what these investors did. They decided their “American Dream” was to be financially independent through real estate investing. Let’s check out how they did it.
Instead of saving up for their dream home after getting married, like we’re conditioned to think is a stepping stone in life, they house hacked single-family home and lived for free since their roommates paid their mortgage.
After owning that house for a year, they graduated to another house hack where they lived in a private living space and Airbnb’d the downstairs apartment.
Let’s look at the numbers to see how this property is performing.
Expenses
| Purchase Price | $653,000 |
| Down Payment (including closing costs) | $41,000 |
| Rehab | $7,500 |
| Estimated ARV | $660,000 |
Rent, Cashflow & Appreciation
| Rental Income | $6,000 |
| PITI | $2,940 |
| Reserves | $200 |
| Cash Flow | $2,860 |
| Principal Pay Down | $10,750 |
| Appreciation | $33,000 |
What makes these numbers work so well is the owner’s self-taught knowledge of marketing their property on Airbnb and using other tools to maximize their Airbnb listing. They currently operate the 2nd highest grossing STR in their market.
Here are some of the tools they use to maximize their nightly pricing, improve their rank in Airbnb and increase their efficiency managing and turning over the unit.
- Data.rabbu.com – Rental & seasonality estimates
- Turnoverbnb.com – Locate cleaners & link Airbnb calendar
- Beyond Pricing – Smart Pricing
- Snappr.com – Professional Listing Photos
Takeaways
If you were to meet these investors today you’d see a highly confident, successful real estate investors, but they were not always like that! They became a pro by taking action, learning along the way and even making a few mistakes. Some advice they’d share with you are:
- Get a mentor to help you get started, a FI Team agent is an excellent resource
- Run the numbers and make a move!
- Plan for expenses
- Have a long-term plan
- Build a relationship with your banker
Do you want to get started on your real estate investing journey? Reach out! We’d love to coach, guide and mentor you along the way.