New Member: Hello Everyone

[Dan B.]

Hello,

I'm very happy to be joining the discussions here on BP (I've been lurking for several weeks).

Long story short: I'm interested in comparing notes with people who have found themselves in an under-leveraged position who wanted to expand their residential portfolios and who had to decide whether to buy, hold, and do cash out refis, OR "pyramid" up with 1031 exchanges.

I'll submit some information about myself here in the interest of connecting with others who are curious about the same things I am:

I made what for me was an all-in bet in ~2011 purchasing 6 condos in the South Bay Area ( San Jose). This turned out to be a good decision. They are all but payed off now and now I find myself in a situation where my return on equity is not so great. Even with rents as high as they are now, the NOI from the properties returns about 5% of my equity. I don't have a good sense of how good or bad that return is in this market where so much revolves around appreciation -- I'm very curious to find out what other investors around here think.

Of course if real estate keeps appreciating the way it has recently, everything is great; BUT even though I'm bullish on the Bay Area longs term (weather, universities, jobs, natural barriers to sprawl, etc.) I can't help but look around and think that the market is frothy at best and something of a bubble at worst.  The house next door to mine just sold to an Asian investor, cash purchase, who intends to rent it out.  He will be lucky to get a 3% return from rents.  There is quite a bit of this sort of thing happening right now.

I'd very much like to hear from anyone who's dealt with a situation like mine.  How should I play my hand?

Looking forward to participating !

Dan