How to Build a $2.7 Million Real Estate Portfolio in Just 4 Years

By some standards, Dan Rivers was a relatively late bloomer when it comes to real estate investing.

Although Rivers had spent over a decade working in property management, he didn’t venture into real estate investing until 2018, when the then-38-year-old and his now-wife decided to move from their hometown of Boston, Massachusetts to Charleston, South Carolina. A year later, Rivers put down the payment to buy his first rental property.

But since then he has certainly made up for lost time.

In the four years since venturing into real estate, Rivers has accumulated a portfolio of 16 units across 12 properties worth around $2.7 million, according to official documents verified by Insider. He also has nearly $1 million invested across a few different real estate syndications.

Rivers believes he was able to scale his portfolio so rapidly through a combination of hard work, adopting a compound growth mindset, and knowing how to take measured risks.

A late start to real estate investing

When Rivers was 16 years old, doctors discovered he had a congenital heart murmur. Three months later, he underwent his first open heart surgery, where doctors fused two valves together to stop them from leaking. This experience helped Rivers embrace one of his core mindsets: go big, or go home.

“Going through a traumatic experience like that — knowing that I actually lost consciousness on the operating table for a few minutes — really made me evaluate my life,” he told Insider in a recent interview. “I’m not afraid to take chances or risks. I have a ‘go for it’-type mindset because I feel like I’m on borrowed time.”

Rivers recovered, and, after graduating from college, he found himself working in property management. Towards the tail end of his twelve-year career as a property manager in Massachusetts, Rivers was in charge of operations for a company that he had helped expand from around 2,000 units to almost 6,000.

In 2016, that business was acquired by a large corporate firm, which rewarded Rivers with a small payout for his equity shares. But his role in the new corporation wasn’t a great fit, and Rivers found himself questioning his career path for the first time in his life.

In 2018 and in search of warmer weather, Rivers and his wife moved to Charleston, where they still reside with their newborn daughter today. Although he didn’t know anybody there and had never sold real estate, Rivers decided that he wanted to capitalize on his newfound confidence by trying his hand at becoming a real estate agent.

It wasn’t a lucrative career change, at least at the beginning. That first year, Rivers only made $28,000 as a realtor. But his real estate investing journey began picking up steam in 2019, when he met a local real estate flipper.

At first, Rivers helped the flipper by finding homes for her to buy, then selling her refurbished properties. Soon afterwards, he began providing her with private money loans, obtaining returns of around 20%.

Buying his first rental property at age 38

Once Rivers realized how lucrative real estate investing could be, he decided to more actively pursue different means of income beyond private money lending, such as flipping and wholesaling.

He and his brother-in-law decided to partner together to buy rental properties, and in 2019 they bought a duplex in Charleston for $125,000. They split the 20% down payment evenly, with Rivers funding his half with the money he’d received from his earlier equity payout.

At the time, both of the duplexes’ units were renting for a combined $1,500 a month. Since the units weren’t in the “greatest condition,” they weren’t renting for top market rates, which Rivers recalled to be around $2,000 back then.

Rivers and his partner waited until the current tenants moved out of the duplex before initiating extensive renovations, which cost around $70,000. The investment paid off — today, including market appreciation and inflation, the duplex rents for around $3,600 a month altogether. Rivers estimates that the current value of the property now sits at around $300,000.

After the purchase of this first property, Rivers and his business partner began growing their portfolio by capitalizing on good investment opportunities whenever they could, typically financing real estate purchases at around 4.5% over a 30-year loan. “Basically what we would do is buy a rental, fix it up, and then do a cash-out refinance,” Rivers explained, referencing the popular BRRRR method.

To get ahead in his investing journey, Rivers also house-hacked the first home that he and his wife bought in Charleston — a method he especially recommends to beginning investors.

That property, which Rivers and his wife purchased for $425,000 in 2020, was basically a duplex that consisted of a unit in the front with a separate building in the back. One tenant lived in the upstairs unit of the back building, while the downstairs unit served as a barn.

Rivers and his wife bought the property with the intention of living in the front unit while renovating the barn into a third unit that they could rent out. After a year, they finally received approval from the city to turn the property into a triplex, which cost a little over $100,000, and moved out once the project was completed.

Rivers estimated that the property currently brings in $3,800 a month, versus a monthly mortgage payment of just under $2,000.

Eventually, Rivers’ goal is to completely pay off all of his long-term rental properties and own them outright.

“Our goal is to hold most of them long term, maybe sell off a few that are really valuable to pay off others because cashflow is the main goal,” he explained. “Maybe we go up to 20 units and we sell five of them. We don’t necessarily need a hundred units — we’d rather have 15 that are paid off bringing in $12,000 a month.”

Expanding his portfolio through Airbnbs and syndications

Besides his long-term residential rentals, Rivers also has ownership in several commercial properties, which are innately higher risk but come with higher rewards. Rivers and his partner also recently expanded into investing in short-term vacation homes through Airbnb, a segment of the real estate market that became oversaturated with investors during the pandemic.

But according to Rivers, there’s still opportunities to be found in the space — as long as investors do their due diligence. For instance, one factor he heavily considered while researching buying his short-term rental was the local market and area.

“The one I have is in the lakes. When I looked at it, there were five Airbnbs in that area — there wasn’t a lot of inventory there,” he explained.

Rivers also has a backup plan in mind in case any kind of economic slowdown lowered demand for Airbnbs. Before making his purchase he calculated that even if he had to pivot towards a short-term corporate housing or long-term strategy, the income he made from the property would still be enough so he wouldn’t lose money.

“Plan A is this, but what about Plan B? Asking ourselves that question is another way that we make sure that we’re hedging our risks as best as possible,” Rivers said.

In addition to his portfolio of residential and commercial properties, real estate syndications also make up a significant portion of Rivers’ assets, and he has around $1 million invested with various groups.

“Syndications are one of the only truly passive investments I have right now, because even with rentals you have the headaches of potential damage,” Rivers explained.

Syndications also offer investors good returns, tax benefits, and can be a great way to inject diversification into a portfolio. However, Rivers said the tradeoff is that any money invested in a syndicate is usually locked up and inaccessible for the next few years.

Although most syndications are usually reserved for accredited investors and have a high cost of entry, Rivers was able to join his first syndication in 2019 with a $50,000 initial investment by networking with investors at a local meetup in Charleston. Rivers said he earned payments of around $300 per month until the fund was sold a year and a half later, when he received $76,000 back — bringing his total profit to over $30,000.

“Being in the right rooms and being around people in either masterminds or meetups … You can get so much value and build such strong relationships,” Rivers said. “If you want to invest passively in a syndication, it’s so important to know the operators — to know who they are, how they invest, and how they operate their team.”

When doing his research, Rivers looks for operators who analyze with conservative estimates, pivot when they need to, and ensure the security of their investor capital.

“I’m not just willing to just give money to someone because maybe the upside looks great, but what about the downside?” Rivers explained. “I’m not willing to do high reward, high risk because if I do that and I lose a hundred grand, it’s going to take so much longer to compound that loss. I’d rather make smaller amounts of money, but just keep compounding that.”

How a compound growth mindset contributed to Rivers’ success

In fact, Rivers credits much of his real estate investing success to this compound growth mindset.

“Having the right mindset and perception on life is so important to be successful in compounding your wealth, life, and relationships,” Rivers said. “I have a growth mindset where if you’re 2% better every week in all these areas, you’re 100% better than you were at the end of the year.”

One of Rivers’ favorite books, “The Compound Effect,” by Darren Hardy, focuses on this idea of breaking down big goals into smaller pieces.

“It talks about taking little steps that have big rewards, rather than trying to always do these big steps,” Rivers explained about the book. “Every day, just keep on doing things that make you a little bit better — and it’ll gradually grow to take you where you want to be.”

Going forward, Rivers wants to use this growth mindset to continue expanding his real estate portfolio, monthly passive income, and Rivers Capital Group, the comprehensive real estate services firm he founded in 2020. Eventually, he’d like to reach full financial independence to free up more time to spend with his family.

“Money has to come in in order to achieve that, and I just started achieving that pretty much late last year,” Rivers said. “This year I finally started achieving where I’m working on things I want to work on.”