Real estate investor Ryan Chaw.

Ryan Chaw makes $6,000 a month in passive income from rental properties.
But not doing a sewer line inspection and buying a 100-year-old home cost him thousands on his first house.
He also lost money by waiting too long to advertise his property and letting rooms sit empty.

At 30 years old, Ryan Chaw is financially independent. Though he works as a full-time pharmacist, “my passive income far exceeds my expenses,” he told Insider. He earns about $6,000 a month in passive income from six properties, with plans to acquire two more in the near future (he’ll soon close on the seventh and is about to put in an offer on the eighth). 

These days, his real estate business runs smoothly; he knows what he’s doing and is able to get the most cash flow possible. But this wasn’t always the case. “There were a lot of things I didn’t pick up on at first,” Chaw said. 

If he could do it all over again, he’d avoid making three mistakes that he said cost him about $40,000 when he was first getting started.  

1. Not being aware of additional inspections 

Just a few months after purchasing his first property and getting tenants settled in, Chaw got a call from one of the residents saying the sewer was flooding the house. “It was like 10 or 11 p.m., so it was hard to get anybody over there to clean up,” he said. Ultimately, he got the sewer line repaired, but it cost him about $9,000. “I’m not the only one who has had that problem, a lot of people will have a sewage line story,” he said. 

However, he’s since learned that this is a relatively easy problem to avoid with a sewer line inspection. “But it isn’t included as part of the normal home inspection,” Chaw said. “It’s technically an optional inspection, so you have to be aware of them.” 

Now, whenever looking at a new property, he often will get specialists to look at the roof, HVAC system, and sewage pipes. “Those are the big three,” he said. 

2. Purchasing an older home 

At the same time the sewer line broke, Chaw also realized the home would need a completely new HVAC system. Then, he found out there were pest issues. These problems chipped away at Chaw’s bottom line even more, costing about another $20,000 to fix. Many of …read more

Source:: Business Insider

      

A real estate investor making $6,000 a month says he made 3 mistakes when he was starting out that cost him $40,000

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