Both units were occupied.
Combined rent was $1,750 a month.
I ran the numbers nine different ways, and every scenario came back positive.
My first duplex had built enough equity by then that I could pull a HELOC for the down payment without touching my savings.
I called the listing agent on a Tuesday and made an offer by Thursday.
The sellers accepted on Saturday.
Nobody in my family knew.
At the next family gathering, Fourth of July at my parents’ house, Kyle was telling everyone about a sales award he’d won at work.
Regional sales leader, second quarter.
My mom had printed out a photo of him holding a plaque and stuck it on the fridge with a magnet shaped like a sunflower.
She kept pointing it out to people as they walked through the kitchen.
“Have you seen Kyle’s award? He beat out the entire region.”
My dad grilled steaks and talked about how proud he was of both his boys, though he was looking at Kyle when he said it.
My mom brought out a store-bought cake that said, “Congrats, Kyle,” in blue icing.
I had a brief private moment of wondering what it would take for me to get a cake.
Probably solving climate change.
Maybe not even then.
Kyle found me on the back porch later, away from the crowd.
He popped open a beer and leaned against the railing.
“So, how’s the little duplex empire going?”
Just the one.
He didn’t know about the second.
“Same old,” I said. “Tenants pay on time. Faucet drips sometimes.”
He laughed.
“Living the dream, bro.”
Then he got a little more serious and added, “Honestly, I give you credit. I couldn’t deal with tenants calling me about broken toilets at midnight.”
“They email,” I said. “It’s not that bad.”
He shrugged and took a sip.
“Different strokes. I like owning my own place without all the hassle.”
I didn’t point out that his own place was bought with someone else’s money.
Partly mine.
I just smiled and ate my hot dog.
Here’s where I need to tell you about something I found while doing due diligence on the second property.
Chapter 5: Professionalizing the Strategy
The previous owner had a small LLC set up that held both the duplex and a third property I hadn’t seen listed anywhere.
The LLC was dissolved, but the structure stuck with me.
I started reading about how LLCs work for real estate holdings, liability protection, tax advantages, cleaner accounting.
That night, I called a guy I’d gone to college with who’d become a CPA and asked him a question that ended up changing the trajectory of everything.
But that conversation deserves its own section.
The CPA’s name was Marcus.
We’d been in the same dorm freshman year, the kind of friendship where you eat terrible dining hall food together for nine months and then keep in touch through occasional texts and birthday likes on social media.
He’d gone into accounting, gotten a CPA, and started working with small business owners.
When I called him and said, “I want to understand how to hold rental properties in an LLC,” he laughed and said, “Finally, someone asked me something interesting.”
Marcus walked me through the basics.
Set up an LLC, transfer the properties into it, keep your personal finances completely separate from the business finances, get a dedicated bank account, log every expense, pay yourself a reasonable management fee.
And this was the part that made my eyebrows go up.
Use the depreciation on the buildings to offset your rental income on paper, which reduces your tax burden significantly.
“How significantly?” I asked.
“Significantly enough that you’ll wonder why you didn’t do this a year ago.”
He was right.
I set up the LLC within a month, transferred both duplexes into it, opened a business checking account, started running things like an actual operation instead of a guy who happened to own two buildings.
The shift wasn’t just financial.
It was psychological.
I stopped thinking of myself as someone who had a side investment and started thinking of myself as someone building a company.
Three years after buying the first duplex, I was 30 and owned three properties.
The third was a fourplex, four units.
Older building, needed some work, but the price was a gift.
A retiring landlord wanted out fast and didn’t want to deal with a drawn-out sales process.