July 2019 Net Worth Quarterly Update

 

This is my official Quarterly Net Worth Update for the 2nd quarter of 2019 (April – June). Below are my actual numbers for ALL my investments and liabilities as of 06/26/2019. Detailed explanations and a quick summary can be found below. If you would like to see my previous months net worth posts, please visit my Net Worth Tracker.  I have been tracking my net worth monthly since May 2015.  If you want to learn how to track net worth then check out how I am doing it.

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TOTAL NET WORTH: $886,017

 

Quick Summary and comments: +$4,913

Wow I can’t believe we are already halfway done with 2019.  Time is flying by and it seems to go even faster now that we are raising our daughter.   One thing to note before I dive into this last quarter’s numbers, please note we are officially having another baby.   Baby boy Cash Flow Diaries is coming in November and we are ecstatic about it.  Our little family is growing and I can’t be any happier about it.

Well as you can see in the spreadsheet above, my net worth barely went up however this is because I am being ultra conservative about some of these numbers and not to mention I still have a lot of cash into my rehab on property #9 that I am not accounting for in full in yet.  I am going to wait until the rehab is complete and the house is sold before I finalize and numbers on that one.

Other then that everything else seems pretty normal.  Debt is slowly coming down except for that I had to dip into my HELOC finally but this was expected. It’s safe to anticipate I will have an even bigger balance on this in my next update.   Unless I get very lucky and sell my flip before then.  **crossing my fingers**

Personal Life Update:

My sweet baby girl is now 13.5 months old and she is the best thing to have happened to me.  I truly see now that family is the most important thing in life.    I am still very passionate about reaching financial freedom through real estate and honestly even more so now because I know once I get there, I will be able to spend more time with family.

As you read above, we are having a 2nd baby and this time it will be a little boy.  Our family is growing and I really love what is going on in our household.  Things are going great for us in the grand scheme of things and for icing on the cake, I have some family members finally talking about moving here to Indy which would be a huge benefit for us.

Real Estate Investing Update:

Alright so property #9 which I have been trying to flip for a year now is finally back on track.  After fighting with the city for about 4 months on permit and contractor issues, all that is taken care of, I hired a new contractor and work has resumed.   It feels good and now I am starting to see a light at the end of the tunnel.   Hopefully by the end of this week, we will have all mechanicals in so we can order inspection and from there we can start on the drywall and all the cosmetic stuff.   Honestly I am still probably a few months away from listing the house for sale based on the timeline but I will be very happy if its ready sooner then that.     Once I get my money back on that house, I am officially looking for my next rental property.   My flipping experience has not been good so chances are slim I will try to do another one.

As for the carriage house I am building at my primary residence that I mentioned about in my last net worth update, well that is almost complete.  I suspect in the next few weeks it will be done and it should start making income in August which we are excited about.

Okay enough about that, lets jump into my net worth categories.

Assets: Explanations of each of my assets.

Cash:   -$41,536

My cash is drying up!!  With good intention though, I have been paying for the carriage house build in cash and that is why I have such a big drop.  I did not want to finance the carriage house and once it’s complete, it will be a money maker for me so I am confident my cash will build back up.  Especially once I sell the flip (property #9).

My cash as noted above in the spreadsheet consists of my wife and I’s checking account and my REI (Real Estate Investing) checking account.

HSA account: +$611

Saw a small increase in my monthly HSA account.  Now that we are having baby #2, the doctor visits started up again.  I plan on draining my HSA account this year for baby #2’s birth.

My HSA contributions are automatically deducted each paycheck from my dreaded W2 day job.

Company Stock Options: +$2,491

My company stock never ceases to amaze me.  It is once again at all time highs.  I would have had so much more money if I didn’t sell a bunch of it over the past years.   I put the money to good use though (to buy rental properties) so I don’t feel too bad about it.   Luckily,  I am getting more stock (RSU’s) in September to reward my tenure with the company.  I thinking this will be about $20k in stock.  Woot woot!

These are stock options from my day job. I am fully vested.    

Stock Portfolio: +$1,029

I am down to just a couple of stocks left and they are in precious metals.  These are my last two and only two that were in the red.   I plan on holding out until these two are profitable and then just get rid of them.   Stocks aren’t my forte.

I bought all my shares using tradeKing  which is now Ally.

401K: +$340

I made an executive decision awhile back to take money out of my 401k and no longer contribute any more money to it. Mainly because I do not get matched contributions from the dreadful day job. But also because I think I can make better returns using that money on rental properties.    Any movement you see in this asset is only from market fluctuations.   I am not able to withdraw the remaining amount in here until I quit my job.   I really don’t like the idea of having an account that punishes me to take money out because of age.

Property # 1 (Indianapolis, IN)

All is good with my primary residence at this time.  We live in downtown Indianapolis and we love living here.  The carriage house is finishing up now in which it will become an airbnb property.  I anticipate making an extra $800 to $1000 per month from this carriage house which makes for a solid return and a great additional income producing asset to add to my portfolio.   Not to mention, we are going to have a bad ass rooftop deck with downtown Indy skyline views.  Yeah buddy!!!

My current primary residence in Indianapolis.

Property # 2 (Austin, TX)

Rent paid on time and no repairs made this past quarter.  The lease is not up until April 2020 which is unfortunate because I really need to increase the rent on this one.

This is the property I self manage in Austin.   Even now that I live in Indy, I will continue self managing this one.  I think I can do it from afar and if in the future I realize that I can not continue being my own property manager, then I will probably just find a PM to handle it.

This was my first rental property.  It’s actually the first house I ever purchased in general.  I bought it when I moved to Austin way back in the day and it was my primary residence for a long time.  I originally never had plans for it to become a rental property but when I discovered the beautiful world of real estate investing, I knew I would someday convert this one to a rental.   I expect gradual appreciation from this property because it is in the suburbs Austin which has been growing tremendously.  Love me some HOT markets!

Property # 3 (Indianapolis, IN)

Rent paid on time no repair requests surprisingly however these tenants are finally moving out after 3 years.  I will transition this property to self management beginning right now in July.  I plan on being very busy in these coming weeks getting the house rent ready, listing it and screening for new tenants.  The good news is I plan on increasing the rent at least another $50 per month and the fact that I am no longer paying a property manager to manage this one means I will be getting an additional $140 per month then I was before.   That is a very nice increase in my cash flow and I am looking forward to it.

This is my first turnkey rental property I purchased out-of-state in Indianapolis. I do not expect much appreciation on this property. I purchased this for CASH FLOW purposes only.

Property # 4 (Indianapolis, IN)

Tenants paying on time every month and they did submit one repair request which I was able to fix myself without spending any money.  So far these new tenants have been great!

This was the house I lived in when I first moved to Indianapolis.  It was a rental property, then my primary residence and now back to a rental properly.  It took me 1 week to find qualified tenants in February 2019 and this property is now being rented for a nice $1200 per month and leased for 2 years.  It’s a cash cow and I love this one a lot!

This was originally a turnkey property I bought back when I lived in Austin.     I bought this house for $67k back in June 2015 and cash flowed off it until I decided to move to Indy and move into it when we first came to Indy.   I spent an additional $30k in renovations when  I moved into this house to make it an awesome primary residence.  So I am all in for $100k.    Here are the details on when I originally bought this one as a turnkey rental property.

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Property # 5 (Indianapolis, IN)

Rent paid on time.  No repair requests made and this tenant is also moving out after 3 years.   So I have two properties vacating at the same time and both of these were my last two that were being managed by a Property Manager.  I am taking over this and now I will officially be self managing ALL of my properties.  Since I am staying in Indy for the long haul, it doesn’t make sense for me to have a property manager right now.   This will be re-evaluated in the far future if necessary.

This property is going to need a bunch of repairs and I am anticipating a costly expense to make it rent ready again.  We’ll see how it goes.

I originally bought this rental property from a wholesaler here in Indy after I moved here.  I paid this one in cash and it came with a properly screened and paying tenant which was great.

 

Property # 6 (Indianapolis, IN)

We have decided that we are going to convert this full time airbnb property back into a normal rental property.  Mainly because my wife is pregnant and with baby #2 coming, she is not going to have time to clean/turnover anymore after each guest.   The income is not good enough to hire cleaners and it will be easier for everyone to just make it a standard rental property again.

This property is still a full-time airbnb vacation rental property and it’s going well but not as great I as ever wanted.  The competition here in Indy is fierce on vacation rentals.   We stay about 50% booked on it and still make anywhere from $300 to $500 more per month profit on it compared to if it was a normal rental property.

I officially converted it into an airbnb in late January 2018 and it has been keeping steadily booked and we are making money.  This was a traditional rental property which was rented for $950.  After a year of having it as a rental, I decided to convert it into an airbnb because of its great location.  You can see how much money I made in the first two months of being on airbnb here.

I bought this house from a wholesaler here in Indy for $65k in a very popular Indy neighborhood back in late October 2016.   I put in about $20k getting it rent ready.    And an additional $10k to make it airbnb ready.

 

Property # 7   (Indianapolis, IN)

Rent paid on time and finally a repair request made to replace a bathroom vanity.  It will probably cost me $500 to do this as its a big vanity but the truth is I should have replaced it when I bought the property.  I knew it was falling apart but wanted to see how long I could milk it before having to fix it.  1.5 years later and its time to replace it.

Other then that, these tenants have been great and this property has been a cash cow!

I bought this home as a foreclosure off the MLS.  Paid in cash, fixed it up and rented it out in 2017.  Check here for all the numbers and details of this property.

 

Property # 8  (Indianapolis, IN)

Mortgage paid on time. No issues. This is a note that I own from a house that I sold via owner finance in the Austin area.  If you notice though, the reason why this asset will continue to go down from the spreadsheet above is because it is a note and the principal balance on it goes down each month as the buyer pays me. Remember, I’m the lender on this one.

 

Property # 9  (Indianapolis, IN)

Jeez I cant believe I have owned this stupid property for over a year now.  This is my first full gut flipping experience and it has not gone well.  We are finally at the point where I can resume work and I am keeping my fingers crossed nothing else goes wrong with this one.  The good news is I still think I can at worst break even which would be a win for me at this point.   Really just want to finish this off and sell the house so I can get my money back and start looking for my next rental property.

This one is my first ever full gut flip project.  I bought this house in May 2018 from a distressed seller in a popular neighborhood in Indianapolis.  Purchased cash for $56k.

 

Property # 10  (Indianapolis, IN)

My first ever failed real estate investment.  I ended up losing close to $10k on this after all was said and done.  I learned hard lessons here and am thankful I did not lose more.   This was the first time I ever lost money on any investment.

This was a run down house in a good neighborhood that I purchased for $40k with the original intention to wholesale it off to another investor and make a quick profit.  That didn’t work as the house was just in too bad of shape.  I ended up having to sell the house to another investor at a loss.

 




Liabilities: These are self-explanatory so I wont dive too deep into these however I would like to include the items below for informational purposes.

Credit Card

I only use one credit card (rewards card) that I use to purchase my everyday expenses. I pay this off in full every month. I am receiving 1.5% cash back on this card and am very pleased with it. Satisfied!

 

Last 30 days net worth graph from Personal Capital

This month’s chart shows a big gap from when I used up cash to fund my carriage house up until slowly recovering that money back from adding equity to my primary residence.   I love this chart! It looks great and its nice and big.

 

If you want to set up and track your net worth online like I do, create a FREE account at Personal Capital.

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Cash Flow Diaries

8 Comments

  1. Congratulations on your growing family! Thanks for posting the update… I’m always curious how other real estate investors are doing.

  2. Great post, glad to hear things are still chugging along.
    I sure hope you’ll consider going back to posting more often – great info, easy and fun to read and no sales pitch crap – just genuine, good real estate content.

    • Thanks Sam! You know I keep wanting in my head to write but I just cant seem to find the motivation these days. Between the day job, baby and everything else I just seem to be lazy about the blog. Honestly thought I think at some point I will resume with the posts. I have some content I have been wanting to write about. Thanks for the encouragement!

  3. Congrats on baby#2! I’m sorry to hear the Airbnb property isn’t going as well as you had hoped. Why do you think that’s the case? I’d be curious to hear about occupancy rates and how much you’re charging? I do see that there has been more supply which means more competition but also more demand. Do the summer months make up for the slower winter months? And for the cleaning fee, couldn’t you hire that out since the guest pays that fee anyway?

    • Hey Andrew,

      The occupancy rate hovers around 60 to 70% in the summer and around 40 to 50% in the winter. I charge about $85 per night plus a $40 cleaning fee. A bit cheaper during the week. I could hire out the cleaning but if I did that it wouldnt really generate that much more money after all the expenses then if it were just a normal rental property.

      We are going to convert our new carriage house into our new airbnb as this one will be much smaller (easier to clean) and will also be walking distance to a bunch of restaurants and bars so we’ll see how that one goes.

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