It’s hard being a single parent.
You’re constantly triaging all the demands on your time. You have a full-time job, full-time parenting responsibilities, and of course you have to manage a household entirely on your own. And that’s before you even think about your own life, your friends, your interests.
Part of the challenge is having a single-income household. But does it have to be that way? Does one breadwinner necessarily mean one income stream?
Many single parents (and married parents, for that matter) feel like they’re constantly running on a hamster wheel, trying to get ahead simply by working their job. But relying solely on income from a job is a recipe to keep running forever. It’s impossible to get ahead and create lasting, sustainable wealth just from working a job. Because the secret to sustainable long-term wealth is to replace more and more of your labor-based income (active income) with investment-based income (passive income).
How can single parents get started, in escaping this endless cycle of running on the hamster wheel? We tracked down a single mother in Baltimore who went from nothing to owning six rentals in one year, and we asked her to share her story with us.
Meet Nakeisha, Single Mother
Nakeisha Turner works for the State of Maryland, as a Public Information Officer. She has a 12-year-old daughter, and fell into real estate investing almost by accident.
“My mother bought a property really cheap, which was supposed to be for my aunt, who is disabled.” Nakeisha explained. As she helped oversee the renovations, she ended up speaking with other residents in the neighborhood, and discovered a number of nearby owners who were also willing to sell inexpensively. The more she learned, and the more people she spoke with, the more intrigued she became.
But when the property was ready for her aunt to move in, life threw a curveball. “For some reason, my aunt didn’t want to move into the house my mom bought, so my grandparents charged me with finding another property.”
What did Nakeisha and her mother do with the renovated home they suddenly had available? Why, they rented it out, of course!
Thus began Nakeisha’s forays into the wild world of real estate investing.
Finding a Mission
It was around this time that Nakeisha traveled to Nashville for her college’s homecoming weekend. But in the few short years since she had graduated, the neighborhoods around the historically black college had transformed. Young professionals had arrived in droves, completely changing the feel – and affordability – of the area.
“I was surprised and appalled at the gentrification of the area surrounding the school,” recounted Nakeisha. “So, I vowed to help prevent this from happening at or around any HBCU in Baltimore.” (For the uninitiated, HBCU is short for historically black colleges and universities.)
To be clear, Nakeisha’s story is not one of opposing economic development or neighborhood improvement. Quite the opposite; she goes in and renovates homes to improve the living conditions, in hopes of helping to make each block that she invests in better.
Her mission is to maintain the character of specific neighborhoods surrounding historically black colleges.
Nakeisha’s Investing Strategy
For her first half-dozen properties, Nakeisha has focused on the neighborhood surrounding Coppin State University. Until now, she has bought rowhouses (for which Baltimore is famous).
Yet Nakeisha has started expanding into other neighborhoods, and other property types. She’s started buying properties near Morgan State University, and has a duplex under contract – her first multifamily.
“My goal is to expand to another HBCU neighborhood next year, and hopefully a fourth the year after that,” Nakeisha explains. She’d like to increase the diversity of her portfolio, but understands how important it is to know a neighborhood intimately before investing.
Always her mission remains in focus however: buy near HBCUs, keep the housing affordable, maintain the neighborhood’s character while improving its habitability.
When I asked Nakeisha about financing, she said she’s had her best success with seller financing. “I’ve established a relationship with one lender, but their minimum loan amount is $75,000, more than I usually invest.”
Instead, she’s found a surprising niche: owners who inherited their parents’ neglected properties. “Many of these owners don’t really know what to do with these properties. They don’t have the money to renovate them.”
These owners are often willing to finance the properties for her, providing them with an extra income stream instead of a property that was simply sitting vacant.
Nakeisha typically buys homes for $15,000-30,000, and then invests in renovation work. At $30,000, she expects the property to need only minor repairs.
Sometimes she partners with family members on deals, but in other cases she’s invested on her own.
After some basic renovations, these properties rent for $950-1,200/month. At the higher end of that spectrum are Section 8 tenants, while cash tenants usually pay less.
“I know a woman at the Baltimore Housing office. She’s starting to refer renters to me who she knows have a good track record.”
If those numbers seem too good to be true, well, they sometimes are.
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Challenges with Tenants
I’ve had my fair share of nightmarish experiences myself with lower-income rental properties, and asked Nakeisha about her experiences.
“Early on, I wanted to try and give back to the community so I accepted tenants from a program that placed women who’d been victims of domestic violence. Two women moved in, and they’ve pulled every dirty trick in the book ever since.
“They refused to pay the rent, and then promised the court they would put money in escrow. They didn’t. Then they called the City on me several times to stop eviction procedures, looking for any technicality.”
The end result has been endless repair orders from the City and an ongoing eviction nightmare.
But not every renter has been so antagonistic. Nakeisha has also had renters who pay on time and treat her properties with respect.
“Tenant screening reports are great, but they only get you so far. To me, I’ve discovered that it’s their personalities and values that matter most. I’ve started spending more time interviewing rental applicants in person, and developing a better intuition for who’s going to be a good renter.”
While you still need credit reports, criminal background checks and eviction reports, it’s just as important to follow up with past landlords and personal references to fully understand what kind of people you’re letting into your property.
Challenges and Advice for Other Single-Parent Investors
It’s not easy working a full-time job, being a single mother, and maintaining a one-adult household. I asked Nakeisha how she juggles her many responsibilities.
“Not having enough time or extra money is a constant feeling. As a single mom, it all falls on me, so maneuvering resources has been a challenge.
“But one thing that’s made a huge difference for me is including my daughter as a part of my real estate investing business. She comes with me to look at homes, she sends out the tenant notices. She even shows properties to prospective renters, walking them around and giving them tours!” Nakeisha laughs. “Well, ok, I’m there too, but prospective renters enjoy getting a tour from a 12-year-old.”
I asked Nakeisha what advice she has for single parents who are thinking about buying their first investment property.
“You don’t have to do it alone. I’m not saying wait for a spouse, but you can get a partner.”
Nakeisha’s mother and grandparents have at times served as financial partners with her, and it was her mother’s home search for her sister that kicked off the entire venture.
Her last words of wisdom for other parents and aspiring real estate investors?
“If you have the basic financial resources, go for it. There’s always a way of finding more financing. Be as realistic as possible with what you can do with your time, you’ll need to be willing to sacrifice, but you can absolutely make it happen.”
Are you a single parent with rental properties? What have been your challenges? What advice do you have for other single parents just starting to create passive income from rentals?
This is such a great story! Makes me feel like I can do this too. I don’t have any rentals yet, but I’m hoping to buy my first one within the next couple months. Going to check out the free mini course you guys provide.
Will you follow up with Nakeisha in 6 months or a year? Curious to hear how her plan is going!
Thanks Sally! You can 100% do this too. Nakeisha doesn’t have any superpowers, she’s just willing to put in some time on the weekends to learn and build her portfolio. I hope you do check out the Snap Landlord course, and great idea about us checking back in with Nakeisha early next year!
Absolutely! And you know what Sally, you can do it! Looking forward to hearing your story 🙂
Absolutely fantastic story Brian. I bought my first rental before having kids, but I certainly know the stresses of being a parent and managing rentals. I love these case studies/personal stories you guys dig deep into, please keep them coming!
Thank you Cara, being a past single mom, this story had a personal impact on me as well. Good for you in starting your portfolio as well! Thank you for the kind words!
I was a single parent for a long time, and it took me years before I realized I didn’t have to constantly battle just to stay afloat. When I started getting proactive, that’s when my life turned around. It literally changed my life when I sold half my junk, got rid of cable TV and other non-essentials, and started saving and investing in rental properties. Today I have 3 properties, and it provides nearly $1,000 in extra income each month. Wish I’d started sooner!
So glad to hear it William! It really is a life-changing event when you take full control of your finances and start investing for passive income. Glad to hear you’ve turned that corner and bringing in some good rental income!
This goes to show that real estate investing really is an accessible path to wealth for anyone. Sure, it helps to be born with a silver spoon and lots of expensive education, but it’s not necessary for success in real estate. Super inspirational!
I totally agree Heidi – real estate is a path to wealth and passive income that’s available to anyone, and doesn’t require years of expensive education or a massive amount of seed capital. Our goal is to help 1,000 people reach $1,000/month in passive income, and we can’t wait to surpass that goal and set an even more ambitious one!
I am a 37yrs single mom of two wonderful kids ages 7 and 10. I’m not sure how we would have survived if we had to pay a full mortgage. We’ve been house hacking after watching your masterclass about FIRE, and it’s made all the difference in the world.
Still haven’t bought my first standalone rental property, but as I get on my feet financially I’m excited to start building a property portfolio. Thanks again for all you do!
I love this! Hoping I can do something similar over the next year or two. Just getting started, excited to learn more!
Glad to hear you’re working on building your own rental portfolio and passive income Ella! Check out our free masterclass with Scott Hoefler, on how he reached financial independence in under 5 years, you’ll love it 🙂
I found this blog on your Facebook group and I am so glad!! This was such a great story, very inspiring!! Loving all of your content. Keep up the great work.
So glad to hear it resonated with you Barbara! Keep us posted on how we can help 🙂
What an Inspirational story!! I’m a single mom of two and working towards owning my first rental. I needed this read!
Glad to hear it was inspiring for you Elana! That means a lot to us. Keep us posted on your progress!
Super inspiring! As a single mom this definitely helps me believe it’s possible to build a rental property portfolio, despite not having massive savings.
Thanks for this!
Simply amazing! Thanks for the share.
Glad you enjoyed it Ria!