What would you do?

[Jesse Jones]

Hi all,

Long time reader finally decided to make a profile and ask some questions!

I'll lay out a little about myself, my background and my current position so ya'll can get an understanding of who I am, my goals and what methods would best be utilized to achieve them. I am 34 years old, born and raised in the Bay Area CA, no wife or children. I have a stable long term job in manufacturing grossing approx 250k a year. My job will typically keep up with CPI however I won't get wealthy in my position or line of work. I bought my first home in 2017 (major fixer) in the SF bay area and completely renovated it including building an ADU, adding a master bath and bed as well as updating just about everything. I had been so focused on developing my career and renovating my house I never really had much thought to learn about on real estate investing, up until the last year or two. That leads me to where I am now and some of the thoughts and ideas on what brings me here to make this post. I have spent a lot of time searching through posts on these forums to get an understanding of different directions and investment decisions that interest me, however I realize times are dynamic and what investments worked 2 years ago may and most likely would not work the same in todays world.

 As much as my home comes with the emotional attachment of all the work I have done, I do my best to look at it as a tangible asset and how I can best utilize the equity for growth. Based on comps and speaking with realtors we figure I can sell my home and after paying off my mortgage and selling expenses I could net approx 750-900k, depending upon the sale price of course. Now you may think if I sold my home where would I live? Apartments/ homes rent for approx 2500-3500 a month in the area im looking at, I am limited to living in the Bay Area due to work. So the million dollar questions is (or just shy of) - What would you invest in? My goals are long term growth over cashflow (at least breakeven and cashflow would be nice), I would like to buy properties with the intent not to sell, but to scale and continue to acquire more RE, and have the snowball effect pay off down the road in 5-10-15+ years, but again I'm open to all ideas. I'm not trying to get in over my head on a project that will require more then I have to give (in time and knowledge), however my job does provide me some flexibility. I understand everything is a trade off so I am open to diversifying markets and strategies to find what works best. I don't love the idea of giving up my sub 3% mortgage rate and paying more to borrow money, but sitting on that equity and not putting it to work makes me feel I'm leaving a lot of growth on the table. I like the idea of investing in multi family (4 units and under) and maintaining the stability of a fixed 30 year mortgage, however am open to all ideas. I currently do not have any student loans, car payments or other debts besides my mortgage. 

Some of the ideas I have came across after the searching these forms and talking with friends that have had success in RE are;

-Out of state investing (may be best for cashflow?)

-Multi family BRRR (may be best for scaling and appreciation in the bay area?)

-STR / MTR

-Section 8

-Single tenant triple net

-Other commercial RE investments such as storage facilities or RV parks

There are so may options and I'm at the point where I realize I know what I don't know, so I am open to any and all ideas. CA does possess its own added challenges a landlord may face that other states offer better protection against. Please share your experiences on some things that worked for you and what didn't work, and also tell me if I am crazy for even entertaining any of this. Looking forward to learning more about RE and soaking up some knowledge on here.

Thanks for your input and responses,

Jesse