10-Year Financial Freedom Plan with Rentals in High Price Markets

[@KD-sz1tu]

I’m 26 and work as a software engineer but I dream of financial freedom through real estate. I’m currently rehabbing my Single family home with my brother with plans of renting. For the past month we have been installing wood floor and painting after our 9 to 5 jobs. While we are renovating I listen to coach Carson to get the reassurance that I’m not going crazy 😂. Thanks Coach!

[@CoachChadCarson]

@@KD-sz1tu nice work!! You've got this. Step by step it'll grow. Thanks for listening!

[@methodicalcuts1252]

Coach Carson, I listen to you after a hard day of mowing lawns. Seeking financial freedom!

[@CoachChadCarson]

You've got this! Thanks for the comment.

[@andresmattos7541]

Coach you are a good person, doing all these just to help people. Thank you for all you do! 😊😊😊

[@CoachChadCarson]

Thanks for the feedback and for watching! Hearing from you makes this fun for me.

[@Easyservice-x8q]

This channel really has become a top tier Masterpiece.

[@roldancrespo]

Excellent video!! Realistic and attainable with patience and systems in place. Liked very much the format to get the message across. Thank you Coach!

[@CoachChadCarson]

@@roldancrespo thanks for the feedback and for watching!

[@melissaleak7241]

🎉Planning to make this my 10 year resolution!🎉

[@jadpratt]

50 units at under $200 cash flow per unit. Not bad for long-term, but seems like a lot more work than the 5-10 unit small and mighty strategy. I’d definitely prefer the small and mighty strat :)

[@CoachChadCarson]

Yep. Different approaches for sure. This couple would have had to pay taxes if they reduced their debt and owned fewer properties. So, I wanted to show an example where they avoided that. But definitely options here!

[@DionTalkFinancialFreedom]

Great stuff.

[@CoachChadCarson]

Thanks Dion!

[@deanbranson517]

Another great video. I learn something new every video I watch.

[@CoachChadCarson]

@@deanbranson517 thanks for watching!

[@deskennedy6671]

Great video again 💪

[@leeroach3381]

Very helpful Thank you for sharing this

[@Khanh.Nguyen369]

Great video and info.

[@krillansavillan]

10% year over year appreciation would be incredible. Coach, do you have a video contrasting real estate returns compared with something like an S&P500 ETF? Maybe compare down payments and rehab with steady stock investing. I'm trying to see the magic, I want to believe!

[@kylefordinvest]

Thanks for sharing this valuable insight!

[@CoachChadCarson]

Glad it was helpful! Thanks for watching.

[@elizabethblazina7022]

Coach, just love your content as always.. But isnt there a time limit to do a 1031.. so essentially a gltch in your scenario where you mention that they sell "gradually".. Did I miss somthing?

[@CoachChadCarson]

thanks for watching and for the feedback. What I meant by that is they could sell one of their California houses, then buy a few multiunits with a 1031 exchange. They sell another house in California, and buy more multiunits in a separate 1031 exchange transaction. Because they're buying small multis as replacement properties, they don't have to do it all at once in a big transaction.

[@scotttalksinvesting]

45 days to identify your replacement property(s) and 180 days to close, there are some nuances within both timeframes but those are the important timeframes to know. Side note, you must use a Qualified Intermediary (QI) to help facilitate the exchange. If the sale proceeds go to any of your own bank accounts, you will be paying any appropriate taxes on any gains. The 1031 Exchange is completed with each individual property as its own "entity" if sold separately. If all SFR houses are sold as a "Portfolio Sale" then they would all be grouped into "One Sale". I hope that helps!

[@seanbrancati5792]

I've had a property for the last 10 years (I'm 29 now). I moved from Toronto to Montreal where the prices of condos are nearly HALF. I'm thinking of selling my condo, taking that 300k in equity, and using it to buy a condo in a good area within Montreal (with good equity growth). I think I could put 80-90% down on a brand new condo here. Is this wise? My thought is, I'm essentially moving the equity from 1 condo to another, so not losing or gaining, BUT, I could immediately start cashflowing more than 1500$ a month, while also continuing to build equity. Any comments are very welcomed!

[@david_walle]

Thanks coach!

[@CoachChadCarson]

Thanks for watching!

[@flakerflip01]

Chad, you are severely underestimating the joy of swimming around in your own money bin.

[@CoachChadCarson]

@@flakerflip01 Scrooge mcduck style!!

[@brandonboogren8660]

How do you weigh stock investing vs real estate? My belief (although I didn’t run the numbers) is that this couple grew their wealth faster and got better returns in real estate vs investing in stocks due to leverage, tax benefits, principle pay down etc. I’d be curious to know how much of an advantage real estate investing was for this scenario. I have a single rental now performing well that’s very passive due to great tenants but I’m wondering if I buy another or go fully passive into stocks. Could you do a video on this? I get the basic pros and cons (passive vs active, more and less control of performance, leverage vs not etc) but would love to see an example breakdown. Thanks!

[@user-ky4gg5rl8k]

There's tons of videos on this question. To sum it up depends on the market and time. Stock gives about 8% in my area appreciation is 9% some areas are 6% so arguably area matters. Then repair costs come into place and messes with numbers.

[@brandonboogren8660]

@ yes that’s why I would like to see a “post mortem” of a specific real world example! I am curious what the effective returns end up being when it’s all said and done.

[@CoachChadCarson]

thanks for the suggestion, Brandon! I think it'd make a great video. Perhaps I can take one property I bought in the past and compare it to buying stocks at the same time. Leveraged real estate tends to beat an indexed stock portfolio in my experience. I've seen internal rate of returns around 15-20% or more on my properties. That doesn't mean it'll always work that well, but I think there's plenty of potential to compensate real estate investors for the extra time and risk. And I've also found that unleveraged real estate (not using any debt) performs about the same as the stock market with cash flow and appreciation combined (~8-10%). This "Return on Everything Study" found the same thing over many decades: www.economics.harvard.edu/files/economics/files/ms28533.pdf

[@mikethomas6715]

Where I come from you couldn't do that in 2yrs time. It's more like 4-5yrs. Just the government taxes on each transaction is a lot, plus the rent doesn't cover the carrying cost. It would take you more like 15-20 years to accomplish. The negative cashflow would slow you down, plus to manage them while having a full time job.

[@m77ast]

Hello Coach Carson - can I get a discount with your 499 programme - that amount is currently too high for me and I think the information will be awesome to know. Thanks

[@renanuneza8932]

Hi Coach, how much is your membership?

[@CoachChadCarson]

@@renanuneza8932 thanks for your interest. $2,497 right now. May go up later next year as we get closer to the 300 member cap but existing members lock in their rate.

[@maggmaxxx]

Definitely would love to talk with you Coach but I don’t want membership. Any options?

[@CoachChadCarson]

@@maggmaxxx thanks for reaching out. Unfortunately right now the RPM membership is the only place I have time to do any 1-1 coaching/consulting. I may do some more free live sessions on KZbin in near future. Would love to connect then.

[@216_Scratcher]

would 75k get u in a duplex that cost 350k or the credit score will if its 700 wat would matter more

[@CoachChadCarson]

That should work if you have a 700 credit score. They'll also check your income with conventional loans

[@joecastaneda81]

Hi if I house hacked, how long do I have to live in my home until I can move to a new home and only pay a 3% down payment?

[@scotttalksinvesting]

There isn't one direct answer to your question, but on the surface, you'd need the next home to become your primary within 60 days of closing and you'd need to refinance (if planning to keep the first house) You would also need to meet debt to income (DTI) ratio for the lender. A trusted lender with experience/focus on FHA loans would be the best person to discuss this with as everyones situation is unique.

[@AdamDeLeon-l9m]

I purchased our home 2 years ago, I don’t have much saved (25000) and only paid necessary mortgage payments, no extra payments. I am looking to get a rental but don’t know if I have enough for that. Any suggestions, also I’m in Florida and looking to invest here.

[@scotttalksinvesting]

Reach out to a trusted real estate professional who focuses on rental property ownership. They should have a lender they trust to have you speak with regarding options/opportunities

[@dropoutandretireearly1781]

You can always succeed if you actually pay cash for rentals instead of leverage. Cashflow always happens when you pay cash. Stay cheap, save hard and save up cash just like Dave Ramsey says. It can happen. When you friends are out partying and drinking dont waste your time with that crap. Work a 2nd job and stack up cash instead.

[@Hawk2phreak]

Not super realistic in some markets. In my market, a cheap triplex is 490k. That's one that needs a LOT of work. You're saving your pennies for a long time to get that in cash. OR you can recycle the same downpayment over and over and just be a smart operator and use leverage as the tool it is. I'm at 14 doors now and I couldn't have done it without leverage.

[@erikrohr4396]

Putting 100% down on real estate sounds possible if you're already rich, but kind of pointless since you don't get much of a return that way. Might as well invest in a mutual fund.

[@NLGwotlkclassic]

No power of leverage. Investing 5% on a 500k house but the returns are based on the 500k rather than the 25k invested. Now you need to pay taxes because rental income is taxed as ordinary income and with 2 jobs you'd have more ordinary income. Your gains are directly comparable to investing in other assets (why would I put 500k in a house that MIGHT appreciate 3% when I could put it in stocks, gold, etc. that will appreciate faster and are more tax advantaged in this scenario (long-term capital gain tax rate is 20% vs your ordinary income on 2jobs+a rental may be 30%+)) At the very least you need to borrow enough to not pay taxes - it's essentially borrowing interest free money because it's tax-deductible.

[@dropoutandretireearly1781]

@@Hawk2phreak Save Harder !!!! LOL !!!! Every little but helps !!!! Dont throw away left overs, pickup pennies, start a side gig like I did flipping cars, I have driven a 1992 Geo Metro for the last 20 years and I squeeze 68 MPG out of it but I will say I leveraged in my 20 to 30 and then killed 6 mortgages over about a 10 year period but now my cashflow is actually massive cash-flow and now im saving up at the SPEED OF CASH like Dave Ramsey does for all future rentals.

[@Hawk2phreak]

@@dropoutandretireearly1781 I have 14 doors and I'm due to add another 16 by 2026. Im not doing what you would call badly.

[@wn.7765]

I want 5mins of my life back!

[@CoachChadCarson]

What could have been better?

[@Deelo-gj7de]

Hey Chad, I gave you another call and left a voice message with my phone number. Whenever you get a chance, I would love to catch up. Dakota