This is my official April 2018 Net Worth Update. Below are my actual numbers for ALL my investments and liabilities as of 05/01/2018. 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: $698,694
Quick Summary and comments: +$24,749
Oooooh Weeee April was a wild month. So much going on in every part of my life. Where do I start!?? I saw big changes in my net worth this past month but it does not do justice all that really happened. I’ve broken down the major things here that occurred this past month:
1. I bought a new house!! Property #10. A deal came across my way that I could not refuse. It wasn’t so much a super great investment deal but it very well could end up being one of the best investments out of all of mine. The house is located in what my opinion is the best neighborhood in all of Indianapolis and the appreciation potential on this one is by far the greatest out of all properties I own. It was a HUD foreclosure that came out on the MLS, a big time fixer upper for a great price considering the area its in. The catch was that it was only available for primary occupants to make an offer on it. So in other words, if I wanted this house, I would have to move into it. After running some numbers, talking to my wife about it and thinking of our future, we decided it would be in our best interest to purchase the house and fix it up as our new primary residence. This is actually really big news for me and on top of that ,we are doing it all with a Fannie Mae Homestyle Conventional Renovation Mortgage. Which is basically the same as a FHA 203k loan. Wow! that alone merits its own post which I will some day write about.
Anyhow, long story short. I’m paying a total of $265k (purchase price + loan costs + down payment + rehab costs + 6 months of escrowed mortgage payments) for this property and will be moving in when the rehab is complete which we are estimating sometime in September. It’s a big rehab with structural modifications and bathroom additions. As part of the closing, we received an “after rehab appraisal” value of $300k. So I am profiting a cool $35k in equity right off the bat and we will be living in our dream home in the best neighborhood in Indy. Pretty cool and we are excited about it. I could go on into way more details, pros and cons about this but I will reserve that for a future post.
2. I finally got paid back the full principle on the hard money loan I lent out awhile back. After 6 months of collecting interest payments on the $50k I lent out to a local investor it was nice to finally get the full principle back. It actually ended up being 2 different hard money loans with the same borrower. I made a ton of money in interest however I am relieved this is now over with. There were times I worried a lot about not getting paid back and not to mention, I really wanted this money back because I want to start looking for another rental property to fix up and rent.
3. I paid $10k in tax debt!! Ouch!! April is the worst because I always have to pay the IRS for all the taxes I owe. Lately it seems to average around $10k per year. It’s a good problem to have of course so I am not complaining. It’s just a necessary evil. I paid in one lump sum and am now already starting to save for next years payment.
Personal Life Update: Well on top of all that, we are less than 1 week away from our baby’s due date. At this point my wife could go into labor any day now although the doctor is already predicting it will occur after the due date of May 7th. So with that being said, I will definitely have a baby and will be a new father on my next net worth post update. Honestly I am super excited about and we are both ready for this baby to be here. It’s been a long 9 months for my poor wife but she has hung in there and has been a great pregnant wife.
Real Estate Investing Update: So as I mentioned above, I bought property #10 which is a fixer upper and it will become my new primary residence. I will rent out my current primary residence when I move out. I decided I will be selling one of my old turnkey properties that I purchased 3 years ago and am days away from having it listed on the MLS. More info on that to come soon so stay tuned. I am also just about ready to start looking for a new rental property to purchase as well and will concentrate hard on this after the baby comes. I got paid back my $50k hard money loan I lent out last year. So my hard money days are over for now and I don’t anticipate myself lending out any more money in the foreseeable future. Why? Because I want more rental properties! My passive income needs to continue to grow especially with a baby on the way a new primary mortgage I will have soon.
Okay enough about that, lets jump into my net worth categories.
Assets: Explanations of each of my assets.
Cash went up a lot this past month because of that hard money loan that came back to me. $50k in principal. So why did my cash only go up $20k? Because I paid $15k cash to buy property #10, paid $10k to fix up one of my “turnkeys” and get ready for a retail sale, and last but not least I paid $10k in taxes due. Goodness gracious that is a lot of money movement for me. Next monty (May) should be interesting as well especially if I sell that property and acquire another one.
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: +$493
I bumped up my HSA contributions to anticipate a lot more medical bills in the near future. You know, for baby stuff!
My HSA contributions are automatically deducted each paycheck from my dreaded W2 day job.
Company Stock Options: +$2,329
Saw another price increase which I will not complain about. Since I am not hard-core pressed for cash right now though I will just let these stocks sit there. Hopefully it will continue to grow.
These are stock options from my day job. I am fully vested.
Stock Portfolio: +$425
My stock portfolio is built of precious metal mining stocks. It’s super volatile but prior to this month, it was actually going up for a few months which was nice. Unfortunately this is just the nature of the game for this industry. These are highly volatile and I am keeping these until the economy crashes and gold sky rockets. I’m in it for the long haul on these as I think it’s just a matter of time before the precious metal sector takes off. Overall I am still profiting from these stocks as I bought them for dirt cheap a long time ago when the precious metal sector was at its peak low.
I bought all my shares using tradeKing which is now Ally.
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 KNOW 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. Since I purchased property #10 and will eventually move in to it. This current primary home will go back to being a rental property.
My current primary residence in Indianapolis. 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. 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, it’s now worth a lot more than that which I very happy about. Here are the details on when I originally bought this one as a turnkey rental property.
Property # 2 (Austin, TX)
Rent paid on time, no repairs made again. I am expecting to replace the roof soon which will be a huge expense. I guess I am just waiting for the very first sign of leakage but I shouldn’t do that. I need to just pay the money and replace the roof ASAP before any damage incurs. 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 and repair requests were made. I honestly don’t even remember what it was right now nor have I paid for the repair bill but will know soon. By far, these tenants have submitted the most repair requests out of any other of my rentals. They are really picky but they pay on time which is great.
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)
The tenant moved out at the end of March and I decided that I would rather sell this property than to rent it out. It has actually been a great cash flowing property and will make for a really good rental for someone else. Why am I selling? After living in Indy now for almost 2 years, I have decided to be even more particular about where I want my properties to be and this property does not fall under my new criteria. Not to mention, I think I will be making a hefty profit on this for selling it which is amazing. I think this house will sell for way more than what I listed this property to be worth in the net worth spreadsheet above. I will write a post about this after it’s sold with all the details and numbers.
This was my 2nd turnkey rental property in Indianapolis. I purchased this for CASH FLOW purposes only back when I lived in Austin still. It seems I will be making some nice appreciation profit as well after all once its sold. This was also the one where I had to fire my property manager.
Property # 5 (Austin, TX)
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 # 6 (Independence, MO (KC))
Tenant has paid the rent on time however submitted another repair request for a broken refrigerator. The tenant only just moved in a few months ago and I have been having PM problems with this one for the past few months. This was the last turnkey rental property I purchased located in the Kansas City area. I bought this in late October 2015. I purchased this property also for CASH FLOW purposes only. I am not expecting appreciation gains on this one.
Property # 7 (Indianapolis, IN)
Rent paid on time, zero repair requests however the lease is up on this one in June and the tenant has not indicated if they will be renewing the lease or leaving. I might be having a turnover on this one in the next few months. This one was the property I originally wanted to convert to an airBnb but since the tenant renewed the lease I never did so I ended up converting property #8 into an airbnb instead. This tenant has been great so far and I don’t want to ruin that. Easy cash flow baby!!
I 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. The property needs some fixing up however I won’t mess with it until after the tenant moves out or submits repairs.
Property # 8 (Indianapolis, IN)
This property is now a full-time airbnb vacation rental property and it’s going great. 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 # 9 (Indianapolis, IN)
This is my latest rental and so far I have received all the rent payments on time. No repair requests made. I am not expecting any repairs anytime soon as I fully rehabbed this house.
I bought this home as a foreclosure off the MLS. Paid in cash, fixed it up and rented it out. Check here for all the numbers and details of this property.
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.
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 HUGE increase because that is when I bought property #10. It’s beautiful!! I love this chart though. 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.
There you have it folks! How was your month? Subscribe here if you would like to receive emails on future posts including more net worth updates.
Didn’t see that coming. I figured with the baby so close that you slow down on the real estate side for a bit. I guess if its a good deal, you got to take it when you can get it. Good luck! Looking forward to some happy baby news soon!
Ha! Yeah deep down I was thinking my real estate investing would slow down with the baby coming also but for some reason my drive/passion to keep investing is just still there. Plus as long as I have the money to do so, I think I will be alright.
I cant wait to have some good baby news!! Thanks Brian
When you buy and sell do you normally use a realtor? How do you list on MLS?
Hi Ben! I use a flat fee listing agency. It’s the best way to sell a house in my opinion. It lists your house on the MLS for the masses to see but you dont have to pay 3% commission to the listing agent. For the one I am selling right now, I am paying $600 flat fee to list it on the MLS. Im saving thousands! I do have to pay commission to the buyers agent though if they bring a buyer. But I am only paying 2.5%.
That is exactly how I sold my house when I left Austin and I saved $14k. All details here: http://www.cashflowdiaries.com/saved-14k-selling-fsbo/
Also I notice that the debt on your properties is fairly low in comparison to value. Do you put down a significant down payment, or are you paying the loans down aggressively?
Thanks, glad I found your blog!
Hey Ben!! Yeah I was putting down 25% when I first purchased them but all of them have also appreciated since I purchased them. Every January I update with the new values of what the houses are worth which obviously spreads that debt margin even more. I dont pay the loans down aggressively. I always let my tenants pay it and its always just the normal payment. I dont add on extra principal or anything like that.
Wow! Property #10, I guess its a while since I have checked out one of your reports. Nice to see you grinding on…
What is your total passive income stream now across the ten properties (well, I guess soon to be nine)?
I’m interested in taking a closer look at your AirBnB experiment.
Onward and Upward!
Hey Dom! Long time bud! You know I havent calculated my monthly passive income in a while but I think its hovering near the $4k range. And it’s not entirely “passive” as I am including the airbnb income on that. Im in the process of selling one of my rentals right now and I will check to see what my actual monthly passive income is after that.
Wow, a lot going on with the new house and baby on the way anytime now. I just closed on property #2 which is a 2-family house and I’m planning to AirBnb it. I’m actually thinking about doing the same with my property in KCMO. Always informative reading your updates!
Thanks Andrew! Indeed there is a lot going on, my next monthly update will have even more going on!!! 🙂 I cant wait to hear about your airbnb adventure!