2006 Financial Year In Review

The end of the year is fast approaching and it is looking like I'm going to be too busy for the remainder of the month to get much going in terms real estate deals, so I thought I'd look at how I did in 2006.

Real Estate:

I rehabbed only one house this year. My goal was to do at least two, so I fell short there. In my defense though, I was asked by my investors to stop for a while until I could conference with them. That took me out of the market for a bit. I am still waiting on the additional funds they said they would invest, but those funds are coming from a probate trust and it is taking longer than expected for that to settle.

I had wanted to buy at least one rental property this year and I did not achieve that goal. However, I did make an investment that provided two firsts for me: my first out of state real estate investment and my first commercial property investment. I have invested in part of a $1.75 million dollar first mortgage on package of commercial properties in Louisiana. Income from that investment has been on-time and there have been no problems so far.

Personal Finance:

I increased my financial education by attending a meeting in March of other real estate investors and fellow RichDad.com community members. That was an eye-opening experience and actually led to the commercial investment I just mentioned.

I experimented with person-to-person lending via prosper.com. I've pretty much soured on that concept: two of my loans are delinquent and two are current. However, it was an interesting idea and I thought it was worth a try. I might be ok for other people, but it's not for me.

The blogosphere also taught me a new investing technique called reverse merger arbitrage. I'm two for three on these deals so far and am up about a thousand dollars. I've got two more plays in the works and I think this will be a technique I continue to use throughout the next year and beyond.

This year also saw the retirement of our only car loan, which was paid off a couple months ago. The $300 a month that was going to that is now going into our savings account to be used for our next investment. I also continued to save 15% of both my and my wife's paychecks, which will also go towards our next investment. Of course we continue to pay into our 401(k), although only enough to get the full company match.


Next year:

I have a couple of goals for next year. First, I want to rehab at least two properties. This is the same goal as last year, but this time I'm going to achieve it :-) I think I've got the contacts now of people who can get work done in a timely manner, so the only thing that may cause me to miss this goal is if the houses take longer than expected to sell.

I also want to either buy a rental property or make another real estate-backed paper investment, similar to the one in Louisiana. I haven't decided which yet. I like the rental property because of the tax benefits it gives, but the paper investment requires a lot less effort on my part. Time available to me may be an issue because my daughter is turning three and there seems to be more and more things to do with her that require my time. (That's not a complaint though!)