Do any of you long term investors have set limits on when to stop?
I have several rentals and am looking to build relationships with banks to secure funding for more. I believe now is a good time to get more rentals.
However, da wife says, just call it quits. Maybe do a “flip” periodically to build our reserves, but don’t accumulate any more rentals. In the grand scheme of life, I cant come up with a good argument to keep on buying.
What are your thoughts? What are your goals in terms of when to stop buying/holding? Do you dare stop in this current market?
Maybe I am thr wrong guy to answer this (I sold out all of my properties in 2005-2006 although I am planning on getting back in).
The more units you have the more income you have but also the more time it must take to manage your empire. This is especially true if you do your own management, as opposed to having a PM take care of the daily management of your properties. Many people go too far, I’ve bought a lot of houses from burned out landlords.
The thing is, you have to find a place where you are happy with the income versus the effort and resources invested. For some that is 15 units. For another it is 100 units. If you have good PM, maybe 200-300.
However, if the wife is saying slow down, she might be suggesting the money is good now and she wants to spend more time with you. In reality, it may not be an investment thing, it may be a relationship thing.
It could also be that she is seeing such a big investment portfolio - with all of the negative swirling around in the media and local gossip circles, that she is afraid you will over-reach and lose everything that you’ve worked for. She may be saying her risk level has been reached, and she needs some assurances (just like a nervous buyer/seller) that everything is okay.
In any case, it sounds like you need to spend several sessions with your spouse, and explore your visions for the future. it always works best if your visions of the future compliment each other.
My suggestion is to stop buying when you meet your goal. Hopefully, you had a goal in mind when you started buying rentals. If you have the money you want/need to be happy, then stop. If not, keep going until you reach that level.
Wow. I would find it tough if my wife told me “enough is enough”…aka to stop investing or buying rentals. Luckily for me though, my wife is extremely supportive in all my investments (note I invest primarily OUT of real estate, but I do invest in real estate too). Granted I am making us RICH and we’re rolling in cash right now, so she is seeing my success. If I was failing she might not be supportive of me as much.
But anyway - I would recommend you set yourself some goals, create a small presentation…maybe in Word or Powerpoint…which basically shows what your goals are, what benefits you’ll get if you accomplish them and what happens if you do not. Throw in some timelines too. And explain that to your wife. She should understand I bet. In the end if buying rentals is profitable for you - then by god keep doing it. But, you’ll need the support of your spouse too.
I cant imagine stopping, or being ‘out of the game’, but then again things change as we get older. Some have goals of $10k a month in flips/wholesaling, and that isnt going to stop anytime soon. Some want to build up $10k a month in rental income, after that they are good to go and will stop.
Its all about where you are at with your goals, what you want, etc.