Since 2006, I have bought over 30 SF fixer-uppers and I have rehabbed every one of them. Since I have sold half of those properties, I am now down to 15 free and clear rental houses and these houses provide me with all of the monthly retirement income that I will ever need. That being said, I am still in the market to buy more fixer-uppers and when I do, I will usually sell one house so that my over-all inventory total continues to hang around the number 15. In other words, I have determined that 15 rental houses is my "sweet spot". This is the magic number where my management style seems to be well within my comfort zone. I live a completely stress free life too.

6x6,

I too purchased a group of single family homes with a plan. Buy them as fixers for little to nothing, fix them up and rent them out to covert the possible sales to "Long Term Capital Gains", limiting my taxes to 20% instead of my tax bracket -- much higher.

Then sell them one by one and CARRY BACK THE FIRST MORTGAGE, with under 29% down, so this will be an installment sale -- limiting my taxes once again. This will delay the recapture, Federal and State taxes on the profit.

I'm not acquiring any more units at the present, but I am occasionally doing flips and trading up into better quality units, all in the commercial category.

Roy, our business is much like yours, but since there are two of us plus a part-time son, we can handle a few more than we could alone. We have 40 units in 19 properties. We only rent out 38 units though, reserving the two apartments downstairs in our own property for family these days. If we needed extra income, we could always hang out the proverbial "For Rent" sign on one or both.

We just finished the 40th unit today - we need the final inspection for the Certificate of Occupancy but that shouldn't be a big deal cross fingers and knock wood.

We also have ONE unfinished unit in what would end up a triplex if we ever do it - it's in our back pocket for someday. It would keep DH busy without pressure if he gets bored. So that would be 41.

WMH,

If I remember correctly, your average rents are twice what mine are, so I don't know if there any real comparison between your empire and my 15 humble abodes. All I can do is raise my rents each year and hope I can get somewhere near you someday.

Plenty - all of that blood, sweat and tears in managing rental properties seems to be paying handsome dividends for you. Good for you. You deserve it.

Right now, I'm at 26 active houses, plus the rooming house (which has five rooms), plus four renovation projects in my pockets, plus seven empty lots that have the potential for being built on if I ever feel super-feisty, plus some office space that we keep for ourselves.

I'm using all my ADD energy to roll with it, but I'm getting close to the edge of what I care to handle on my own. I have a year and a half before DS1 graduates high school--- college tuition and retirement income being our two primary motivators for getting into the biz in the first place. I like the income from having those units, but as long as I have an active renovation project, all the income seeps out to my handymen, to my plumbers and electricians and roofers and the box stores, etc. So even though I take a huge amount of pride in saving sad little houses from the bulldozer, I'm also looking forward to getting to the part where I just get to be stable and only deal with maintenance and turnover.

The more tenants I manage, the harder it is for everyone's life to be stable at the same time, though. Usually I have one turnover every month or two, but recently, I've had maybe five or six turnovers since Christmas. Some of my international tenants, even though they came in the correct way with the correct paperwork, got a little flighty and decided they would prefer to not stay in Texas. So, those disruptions so close together have been frustrating. Things are evening out. The next vacancy I have on my radar is my anesthesiologist, because the local hospital is cutting its obstetrics program, which is the major source of his hours when he's in town.

Way to go Otis in IL !!!! Your rental houses are identical to mine and your average rents are too. I would love to swap places with you, mainly because you are a young 44 years old.

I guess it strongly depends on your strategy that you are using. It sounds like Roy is using the BRRRR method to real estate investing. It is a valid method of investing but like so many parts of the puzzle we all play, those margins have been squeezed. There are plenty of strategies out there other than BRRRR. I know I started out as a house hacker before it existed by that name.

I believe in diversification so that pain of shrinking margins doesn't hurt as bad across the entire portfolio. The downside, you will not be getting off the charts returns in one year and skimping on by years when things become out of fashion.

I don't specifically use a sweet spot as I use a cash flow target. I make no bones about it; I want to net $16,000 monthly. If there is more awesome, if there isn't - then I need to trim back what I am doing. Most months I am well ahead of it. That may seem like a lofty number to some -e especially those in the Midwest but it truly isn't. Money doesn't go as far as it used to. You will have to use your coconut if you are relying strictly on cash flow - so I don't. That much thinking makes my head hurt.

Now, I am sure someone is thinking this is gibberish. What is this yahoo talking about with diversity? I have 2% interest in a chain of oil well down in the Permian basin in Texas. I have a percentage interest in a chain of performing natural gas wells in West Virginia and in SWPa. I have NNN and NN holdings in the high tax state of Illionois specifically because of the tax structure.

The vast majority of my holding are in small MFH or SFH which like Roy, I enjoy upgrading with improved quality. In addition to using BRRRR, I also implement a housing loan ladder. The proceeds are the moneys I get is used to upgrade current and future acquisitions. Last year I did eight transactions. In 2025 I have number two under contract. In addition to the ladder, I also have the cash flow aspect of the properties. Picking these places up via 1031 cuts the IRS out of my pockets.

So what is the total number? I am somewhere near 60-65 at any one time. If I go higher than that, the headache factor come into play. Not necessarily with the properties as it is with finding help. So you can always trade three SFH into a small commercial place, There are some niche things I do that I don't know if I should even count them. Knowing how to use land trust and how to Sub To a property allows for note wrapping for example. These add chunks of cash that supplement cash flow.

Additionally, If I pick up a postage stamp lot near one of our lakes for $600 from the tax claim office and offer it RTO for $1,000 down and $250 a month for three years. It's only a small piece of land without anything on it - is it a rental? I could list it and get $15,000 in two years time. Granted, I am not making a huge amount of money dollar wise but the rate of return is off the charts without much risk. I get 100% of my money back in less than three months and then its mailbox money and I split it with nobody.

At some point, I stopped worrying about number of units and focused on the two points of what do seem to matter most to me. Monthly income and squireling away for retirement. I focused on diversity and headache reduction. I don't count any of my self-directed IRA or 401K properties in my numbers. Where I am close to being able to use them, there really isn't much use in it in the near future. These are Roth accounts, there is no max/min distribution age. Just strategies that work better than others.

All places need to cash flow - but it acceptable in my eyes to accept lower cash flow if there is a good chance for capital appreciation. Roy brings up some great points. You need to ask yourself the Why so you can have that plan in place to WORK TOWARDS it. So many people there want to know how they can start out owning five, ten, twenty or hundred units. You don't. You eat an elephant one or two bites at a time. You buy houses the same way - a few at a time.

I challenge the notion, "with more units there come more hassles".

What has Mr. LL said about that? Those of you who have heard him speak at a Convention know.

The statement is only true if one insists on being a DIY, Level 1 or 2 landlord. Once you get systems in place and learn to delegate, the hassles go away.

People have asked me how I handle self-managing 54 units, a full time job, a family of 5 with all the activities that go with that size of a troop, and still have time to drive twisty back roads, play in a band, and both brew and drink beer with buddies.

Answer: Systems & Delegation.

Probably the best piece of advice I ever got from a Convention.

Systems and Delegation also free you up for things like vacations and if/when you become too tired and physically unable to keep up with all the stuff. Developing those now rather than later will give you time to refine them and get super comfy with turning over management to someone else... under your wise supervision, of course!

In my Fortune 500 company, we have over 7,000 retail outlets in the USA, Mexico, and soon to be Canada also. We add somewhere between 180 - 220 NET new stores every year, plus occasionally a lot more when we do a company acquisition and buy out a competitor. This could never happen if our CEO insisted on DIY. He's never even SEEN 99% of those stores, much less installed a toilet or slung a paint brush in those locations.

Systems and Delegation. If you WANT to have a bigger sweet spot, that's how to do it. Trust the wisdom of Mr. LL. It works.

Sweet spot? Just one more... LOL

We are at 12 debt free units presently, buying a 13th next month. We specialize in distressed properties with good bones, the dog of the neighborhood. Sweat equity is not taxed.

I'm in my mid sixties...I hire out much of what I used to do myself. But...good systems, prescreening, maintenance, etc. make for pretty easy living.

I have yet to reach my sweet spot I guess.

Down to 20 doors. Been weeding out the lower end places because I know they will end up needing expensive rehabs and I don't want to deal with that any longer. Highest door count was 25.

Doors don't mean anything. I realize that now. I have gotten to the point where I do not physically work on the rentals daily. Sometimes not weekly or even monthly.

Spending my spare time working on the newest place. Kid doesn't want it so I will finish the rehab and retail it.

I hate spending money when I could do the work myself. I am and have always been the DIY guy.

Slowly learning that I can hire things out and not spend my time doing it. This is helpful when I get a pro involved. Used to be a clogged main drain would be me trying to remedy it. Last time I did go over to look and then called my guy to handle it. Money well spent. Maybe the next time I won't go check, but I am not there yet.

13 of my units still have loans, twelve of which are part of a duplex. I like having free and clear properties but that isn't in the plan right now. I enjoy pulling funds out and using the money for other things.

If I keep the same strategy going I could see getting to 30 doors and still be able to handle the management. I am not getting any younger and I know I need to get more people on the books to work for me.

I have some things covered. Appliances, HVAC, drains, wells, sewers, roof replacement. Still need to get someone to work as a dependable handyman. I have a guy that will cover for me when I go to the convention, but he is too busy with his own stuff to be on call all the time.

Have not bought anything since 2015. Have turned down some offers to buy what I have. Must be in the sweet spot.....

Cash flow is good...getting better.

Appreciation has been outstanding...

Will have most properties paid off in 3 years

I was in Florida for 12 days this month

Going to Hawaii for 2 weeks in March

Going to Europe for a month in June

my sweet spot... like to get to around 25-30 commercial doors, 32-36 area multi unit doors. The whole SFH flip has never been my thing.... I enjoy the fix up part, but then hold...