Becoming the Millionaire Next Door
Ten years ago my husband and I hired an electrician to fix a simple problem in our home. He was a nice, unassuming guy in his late 50’s, and the more we talked with him, the more we liked him. It was during this conversation that he told us a story about his life that has inspired me to this day. 
When “John” was a young man of 28, he bought his first DC property. It was a small home in a decent area. He got a roommate who paid ½ of the mortgage and he was able to save quite a bit of money. The next year, he stumbled upon a good deal on another house. He bought it, found good tenants who paid the mortgage each month, and even had a little positive cash flow. After giving the situation some thought, he came up with a plan that he followed to the letter.
Each year for the next 29 years he purchased a small, affordable home in a decent neighborhood and rented it out. His plan was to begin selling the homes once they were paid off – that was how he would fund his retirement. When we met John, he had just sold the first home he had bought thirty years before. He owned it free and clear and it was worth four times what he had paid for it. He planned to repeat this process over the next 29 years, selling his properties one by one. Wow! What a simple plan – but one that would provide him with financial freedom for the rest of his life.
I’m not suggesting that buying 30 houses is possible for most people in today’s financing environment. But this is a fantastic time to buy an investment property if you qualify, as interest rates are extremely low and the DC area has homes in every price point. After an initial investment, the tenant pays for the property, while you reap the benefits. It doesn’t get any better than that!
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Not only do I represent buyers and sellers of DC Property, but I also represent MD Real Estate and Virginia Real Estate as well. I am your exclusive Long and Foster Real Estate Professional. Click here to learn more about me. Originally posted here : http://www.wheretoliveindc.com/blog/becoming-millionaire-next-door/
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Djana Morris - Washington DC - Virginia - Maryland Real Estate
Serving the Washington DC area with Long and Foster Real Estate. I would love to help you buy or sell any home in the DC real estate area including MD real estate and property in Virginia. Contact me anytime for a free CMA on your current property or to get listings emailed to you on Washington DC properties.
Djana.Morris@LongandFoster.com -
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202-309-0146 Cell -
Wow, that is fantastic and I wish that we all had the ability to have something like this in place for retirement.
It is harder to do because there seems to be a limit on how many mortgages you can have... I have 4 rentals which I have 1/2 interest in.....
What a great story! I wish I could have started something like this 30 years ago.
It's definitely harder than it used to be to get financing for more than 4 properties at a time. But even owning one or two investment properties and paying them off prior to retirement would provide a great nest egg for the future. That story opened my eyes to the benefits of real estate investing years before I became a realtor.
Djana -- though it is harder to get financing once one has 4 mortgaged properties, it is not impossible - at least up to 10. However, there is a way around that limitation, by using self directed IRA funds (then there may be some additional tax benefits as well).