How did we do our own monopoly project? How did we start investing in real estate and build our current holdings (two apartment complexes, two medical building and two SFH’s)? In this series we will trace the history of our real estate acquisitions.
In 1999 we bought our first single family home (SFH) for investment purposes. After a series of further purchases, we eventually “traded” (via a 1031 exchange) most of our properties in 2005 for a 76 unit apartment complex in Tempe, AZ. We went from one SFH to a 76 unit apartment complex in six years.
In 1999 we owned our own home but no other real estate. Our three children were 7, 5, and 2. We decided to get into the real estate renting business. Michelle would manage the property/properties while Jim continued to work a ‘regular job’ as an aerospace engineer.
We bought a 3 bedroom, 2 bath house on Arabella St in Mesa, AZ.
We paid $135,000 with 10% down. It was in relatively good shape, so we put it up for rent, our first rental:
We used the dba “Zack Properties”. We will discuss legal entities such as “dba (doing business as”), LLC (Limited Liability Company), “Inc” and more in a future post.
Our tenants would write their rent payment checks to “Zack Properties”.
When Michelle went by, they would often ask if they could speak to Zack or if he would ever come around. A few with complaints got angry and demanded to speak to Zack himself.
But it was impossible to speak to Zack. But Zack was real. Here’s an photo of him from about 2001:
Yes, Zack was our cat. Zack didn’t do property management, but he did do the financials and was the brains behind Zack Properties. He was the best cat in the world. Here is Zack in 1990 as a kitten.
Next, we buy two single family homes in 2000.