Sandi Bandfield was a medical transcriptionist until recently; her husband, Bud, is an independent electrical contractor. They bought their home in Boulder Creek, near Santa Cruz, Calif., for $157,000 in 1989. Substantially remodeled, it's now worth at least four times that.
Last year, the couple began talking about retirement. "We don't want to work forever, and someone's got to pay for this house," Sandi Bandfield said. "We have a nice life, but nothing in savings to speak of. I saw us relegated to a dinky gray condo in Las Vegas if we didn't do something."
Stocks? "I dabbled. I think I made $26 last year." Social Security? "It's piddly. Who wants to live like that?"
Real estate seemed the obvious, and only, answer. The couple attended seminars, began to educate themselves. They remortgaged their home to buy a three-bedroom house in Visalia, Calif., then a two-bedroom cabin near Lake Arrowhead, Calif. More recently, they've bought two houses in Colorado.
Buying houses in order to rent them out is popular. The National Association of Realtors estimates that as many as a quarter of all homes were purchased last year by investors, drawn by the lure of immediate rental income and long-term price appreciation.
Bandfield's goal is 10 properties, each yielding $1,000 a month above the mortgage and upkeep. That would nicely finance their retirement.
The Los Angeles Times is a Tribune Publishing newspaper.