Home News 4 Factors That Helped a 34-Year-Old Buy 3 Rental Properties

4 Factors That Helped a 34-Year-Old Buy 3 Rental Properties

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  • Keallah Smith is 34 years old, has student loan debt, and was able to purchase three rental properties.
  • She said having parents who are landlords gave her a roadmap for how to do that.
  • She also bought it as her primary residence first. We also took advantage of favorable market conditions.

Despite owning three rental properties, 34-year-old Keallah Smith doesn’t consider herself a full-time landlord. She currently works 9am to 5pm as a Scrum Master of a software development team, teaches an online financial literacy course as a side job, and has her three sons at home. I am schooling.

However, Smith has been able to purchase three rental properties with her husband in the last few years. Despite the fact that they both left school with $100,000 in debtIn fact, Smith and her husband are still paying off that debt.

“Honestly, I’m not in a rush to pay it back,” Smith said, citing the low interest rates on these loans as a reason to stay calm with debt.

Being a young mother with a full-time job and student loan debt can seem like a big barrier to becoming a real estate investor.

1. She lived in the first property for a year before moving out and renting it out.

One of Smith’s biggest reasons for starting his landlord career was that he purchased his first property as his primary residence, lived with his family for a year, and then converted it into a rental property. It was her $135,000 home just outside Atlanta.

This helped her because she was able to cut costs by moving her family in with her mother and father, and she was able to use the income she earned from tenants to pay off the mortgage on the house.

Additionally, buying a rental property this way also means you get much more favorable terms regarding mortgages and down payments.

“You can pay 3.5% to 5% down. Conversely, if you enter the game as an investor, they will ask for 20% down, which can be a barrier for many people. There is,” Smith explained, adding: Purchasing her property as her primary residence has also lowered her mortgage interest rates.

2. She wrote the first lease herself and took charge of managing her own estate

When it comes to her properties, Smith does a lot of the work herself to rent them out and maintain them.

“I created my lease online and took my own staging photos to list the property,” she said. has come up.”

Each investor should develop their own strategy in approaching property purchases and management. While it makes the most sense to hire a property manager to keep up with tenants and contractors, for some investorsothers see opportunities to take a more hands-on approach.

Smith said costs can be prohibitive for those looking to get started in real estate investing without a large amount of capital, and it’s best to manage the property yourself.

“We managed the property ourselves because when we did the numbers, it was very expensive to hire a manager for that one property and we weren’t really going to make a profit.” Smith says. “So we decided to take it on.”

3. Her parents were already real estate investors and she wasn’t afraid to try it

Smith also credits her parents as part of what made her feel like she could start investing in real estate. Now her parents are also landlords of several properties and have rented her house since she was a child.

“People are often afraid to start something because they’ve never touched it or seen someone close to them do the same,” says Smith. says Mr. “Growing up, my parents always had rental properties. I think having that example or seeing it done made it more feasible in my mind. I was not afraid to do

Smith’s parents, who are property owners, not only provided her with an example on how to invest in a rental property, but also provided a pretty detailed roadmap on how to do it when starting with a small amount of resources.

“I was thinking earlier this week that I’m going to repeat the same pattern that my parents were doing subconsciously,” she held on to after they moved again a few years later.

“They rented out the first house after we moved to another house, maybe 15 years or so. I remember it being on the SAT when they were selling it,” he said. Smith said.

4. During the short-term rental lockdown, she bought her second and third properties in tourist areas

It was actually a coincidence that helped Smith scale up and acquire two more properties. The pandemic has changed the real estate market in many areas, and suddenly there is an opportunity to buy certain properties that were used as short-term rentals at a much lower cost than usual. It would be otherwise.

Airbnb experienced rapid growth during the pandemic. In the meantime, more people started traveling and working remotely. At many vacation hotspots, this put pressure on local officials. Restrictions on short-term rentals begin due to criticism from long-term residents This is to prevent investors from crowding out homebuyers looking for prime housing.

This was the case when Smith and her husband were looking for two properties, both located in tourist areas of Florida.

The second property Smith purchased is just outside Disney World. She and her husband love Central Florida and originally purchased the property with the idea that it could be owned as a vacation home and used as a short term rental when not staying. To help pay the mortgage on the property.

“We used to go there all the time. My husband and I actually met in Daytona Beach in college, so central Florida has always been a special place for us.” I knew where I wanted to stay, so I was able to buy the property with confidence.”

The COVID-19 pandemic provided convenient timing for Smith and her husband, especially in the uncertain early months.

“This was right after Florida went into a three-month lockdown against short-term rentals, so there was a lot of inventory on the market because a lot of people were selling their homes,” Smith explained. We quickly went to Florida and looked at some properties, and on the way home, I was saving up and had the money to jump at the chance, so I made an offer.”

Smith and her husband paid $350,000 for a four-bedroom, three-bathroom home in Kissimmee in September 2020. The ban on short-term rentals in the area was eventually lifted and since then she has made over her $37,000 within the last six months. Put it on Airbnb.

Earlier this year, she purchased her third property, a beach house in Daytona Beach. As with her second property, Smith said she was able to get the house at a much lower price because the short-term rental market in the area collapsed.

“Short-term renting is illegal in that area, and that’s how we got a lot of homes,” she said. We have exclusive use as the property of , and wanted to dispose of the house as soon as possible after the law changed.

“We scooped it up before it hit the market,” Smith said. “Our agent had an inside tip, so he immediately went down and saw it and grabbed it.”

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