- In 2015, Cory Harelson had no savings, $ 30,000 in student loans, and no financial knowledge.
- After reading books on money, he decided to invest in real estate.
- He stumbled across a fleet of mobile homes for sale and has since increased his net worth to $ 1.8 million.
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Cory Harelson, a structural engineer in Boise, Idaho, knew what it was like to feel trapped. By 2015, he was working 60 to 80 hours a week, overwhelmed by mortgage payments and bills, and balancing out raising a young son. âIt was like a never-ending race,â he says. But in just six years, he’s gone from $ 0 in savings, $ 30,000 in student debt, and little financial knowledge to a net worth of over $ 1.8 million.
Harelson and his wife got married in 2007, but it wasn’t until late 2015 that they started to think seriously about their finances. âWe vaguely knew we were supposed to save money, but we didn’t really have a good reason,â Harelson recalls, saying he was more likely to buy climbing or biking gear than he was. ‘to save money. âI didn’t really save anything until I was 35,â he says.
Harelson built his wealth by investing in mobile home parks, first in Idaho and then slowly expanding to other parts of the country. While its success is admirable, it did not happen overnight.
The book that changed his view of money
One day, in the midst of one of the most stressful times in Harelson’s life, someone at work gave him a copy of “The Wealthy Barber” by David Chilton. Reading the book gave Harelson a new understanding of personal finance. âI was like, ‘Oh, I guess I’m supposed to be saving for my own retirement,’â he says. âThis idea just never occurred to me. “
Harelson and his wife started setting aside 10% of their income and focused on building up their savings. Now on the financial literacy train, Harelson read âRich Dad, Poor Dadâ by Robert Kiyosaki and Sharon Lechter. After that, “I got really excited about investing in real estate and having assets that pay you back.”
Find the right real estate investment
Once Harelson got interested in real estate, he had to find the right property to invest in. âOriginally, I was looking for houses: duplex, triplex, quadruple,â he says. But he couldn’t think of anything sane. He was reading Bigger pockets, a real estate investment community and advice website, and learn how to analyze real estate. âNothing was even close,â he explained.
Then, coincidentally, Harelson came across an ad for a 10-lot mobile home park for sale on Craigslist. Suddenly the formulas he was using seemed much better. Not only would rent to residents cover payments for the park, it would also allow cash flow.
He would own the land and residents would pay to park their homes there. “You’re kind of in the same boat, they invested in the house and I invested in the land, so they take care of the place and tend to be good renters.”
Find the right loan
After finding a property that Harelson wanted to buy, he needed to get a loan, similar to buying a house. Only instead of getting a mortgage, he was looking for a business loan.
“Basically I googled all the banks in town and just started calling them until I finally found one [that was willing to front the loan]In 2016, mobile home parks weren’t as popular and it was a little more difficult than today to find a lender.
Save for the initial down payment
Harelson had his sights set on a mobile home park that he eventually bought for $ 345,000, but needed a $ 100,000 down payment first.
âI did what I like to call a stroke of genius, but it was really pure stupid luck,â he says. Harelson and his wife moved to Boise from Los Angeles in 2011 and bought a house there with a down payment of $ 10,000. But, by 2016, the house had appreciated a lot, leaving him and his wife a good net worth.
To pay the park down payment, Harelson and his wife took out a HELOC (Home Equity Line of Credit), which they then aggressively and quickly repaid using both the cash flow from rent checks and the lifestyle changes they made to save extra money.
Make lifestyle changes to pay off the HELOC
Harelson and his wife began to use You need a budget, a popular budgeting software, to help them better manage their money while paying off the HELOC. âYou can see exactly where your money is going,â Harelson said, adding that it was very telling to realize how much they were spending too many places.
âI would order a coffee and a breakfast burrito every morning, would usually have a second coffee at the store, then go out for lunch every day and we would go to dinner all the time,â he says. Harelson and his wife saved about $ 1,000 a month just by cooking at home more often.
He started riding a bike to save money on car payments and gas, and bought a $ 30 hair clipper to replace his monthly trip to the barber.
The couple even bought a $ 9 box fan on Craigslist and put it in the window to suck in the cold evening air in Boise at night. During the day, they just kept the windows closed, saving them $ 40 each summer month on their air conditioning bill.
The execution of its operation does not require a lot of time
Harelson built his net worth through the strategic buying and selling of various mobile home parks, as well as rent-related cash checks. He still works full time, and when he’s not buying or selling a fleet, the whole operation only takes about an hour or two a month.
âI have a property manager and she’s good,â says Harelson, stressing the value of outsourcing. When buying or selling a property, it may take more time and effort – around 15 to 20 hours a week – but it’s not all year round.
And while he’s proud of the accomplishment and growth he’s seen, Harelson says more than anything that it’s about self-improvement and happiness and space than investing. brought to his life.