148: 7 Houses at 27: Building a Real Estate Empire on the Side

elizabeth colegroveNote: Click here to download Elizabeth’s top real estate investing tips.

Elizabeth Colegrove and her husband are budding real estate moguls. So far they’ve acquired 7 houses, and neither of them are 30 years old yet.

Between their 7 properties, they’re earning around $1800 in cash flow every month, and their tenants are paying off $1650 in loan principal.

But real estate investment is not without risks and Elizabeth joked that I just have easily could have called the episode 27 and $1.1 million in debt. We get into some of the ways she minimizes her liability during the call.

Owning rental properties is one of the oldest side hustles in the books, and for good reason. Over time you can build up a portfolio of cash-flowing assets, and as the years and decades go by, be sitting on a huge amount of equity that someone else paid off for you.

Elizabeth run the site ReluctantLandlord.net, though you’ll hear her strategies and investing plan are very intentional. On the site you’ll find some great resources for current and aspiring real estate investors.

We met briefly at FinCon and I was excited about her story and her straightforward approach.

This isn’t real estate wholesaling or some of the more aggressive strategies we’ve talked about in the past, but this definitely seems attainable as a side hustle. What do you think?

Is landlording in your future?

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7 Houses at 27: Building a Real Estate Empire on the Side <– click to tweet!

Learn:

  • The 3 pillars of real estate investing.
  • The 1% rule and why Elizabeth doesn’t stress about it.
  • How she plans to retire at age 42 with a 6-figure cash flow.
  • What she looks for in potential houses to buy.
  • Her property management techniques and strategies.
  • How her and her husband acquire houses for low down payments.
  • Her action guide for how you can get started in this side hustle.
  • How she minimizes her risk and liability for each property.
  • The factors that increase rental income — and those that don’t.
  • Elizabeth’s #1 tip for Side Hustle Nation.

Links:

Free PDF Download:

Click here to download Elizabeth’s top real estate investing tips.

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6 thoughts on “148: 7 Houses at 27: Building a Real Estate Empire on the Side

  1. Elizabeth is rocking it and is a prime time example of someone who will reach financial freedom at an early age.

    Keep rockin it Elizabeth!!

    Also, thanks for mentioning my blog as well (Cash Flow Diaries). I too am on a super similar road as Liz and plan on being financially free way before “retirement age” because of my rental properties.

  2. Now for the other side of the rental story. One eviction can cost at least one month’s positive cash flow from all seven properties. One repair from a bad storm can wipe out over a year’s cash flow from all seven. Keeping all seven under one legal entity is idiotic…any judgment from one property over and above your supposed umbrella coverage is cross collaterized by your entire portfolio. Then each loan you take out will reduce your ability to get subsequent financing. The above, at least on the planet I come from. This budding empire rests on a very shaky foundation. It will be interesting to see what happens to this landlord in five years. Hopefully, nothing but profitable properties!

    • Adam,

      Thank you for your post. You made some great points. The one thing I have learned over the past 4 years of owning real estate, is there are lots of ways to mitigate and prevent those issues. I have found that the more houses we owned, has create a more not less diversified portfolio. While owning more properties does open us up to more risk, it also allows us to have more properties to cover any additional expenses. Our 6 rentals make enough, that even if the most expensive one goes vacant, we still cash flow positive. Another important point I have found is that no one care more about your properties than you do. Once I created and enforced a 16 + page lease with 37 addendum’s that create skin in the game for the landlord, landlording has become so much easier.

      As for keeping all of our house under one entity. It is actually smarter than one might think. We originally had planed on and even opened an LLC for liability reasons. We found out the hard way after we paid for the LLC’s that this offered us no additional protection due to ” piercing the veil”. Here is an entire post on experience and findings. http://www.reluctantlandlord.net/crash-and-burned-with-an-llc/

      It is true that we do not have a 800 + credit score, because of our investing. On the other hand other than more daunting loans to process (thank goodness we have great mortgage brokers) and more paperwork for us to turn in, we have never been denied a mortgage. While we have had many moments, our financial success (for example having over 400k network by 27 http://www.reluctantlandlord.net/how-we-achieved-a-net-worth/) are directly due to our real estate holdings.

      Thank you for your great points! I really enjoyed your comments. Look forward to seeing you around.

      Elizabeth

      • Great job so young! Readers here should be aware that L&T laws vary from state to state, and what might work for CO might not be enforceable in NY. Get your lease drafted by an experienced attorney in your state. No internet specials. In 34 years of law, I have been frequently amused by layman drafted lease clauses.

  3. There are fair housing laws that vary from state to state so be careful implying that you won’t rent to blacks, Asians, or Hispanics just because you “don’t feel safe” as a white woman of German descent. Also, most discounted houses from programs such as VA, USDA, section 8, etc. tend to be located in more undesirable neighborhoods which might also explain her lower monthly cash flow.

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