New member from Southern California

[Phillip-Phuc Le]

Hi, my name is Phillip and this is my first post.

I've been listening to the podcasts and have been inspired to get back into real estate investing. This is the story of my first deal: 

I moved to Philadelphia to attend medical school in 1997. The summer before I started, I saw a Carlton Sheets real estate informercial and purchased the course for about $300.

In the spring of my first year in med school, I had my landlord who was also a realtor take me around to see properties. One that caught my eye was a 4 bedroom, 2.5 bath row home that had been on the market for a year. They were asking $100K.

I offered $60K, which my realtor was not so keen on presenting. The seller countered at 66K which I took. It turns out she was a motivated seller - her husband had been an investor and as he got sick and then passed away, she was left with managing his properties. This property had been vacant because they (wife and son) had been trying to rent it out without making any improvements over the years.

I used an FHA 203K loan to purchase and fix up the house. It was a 3% down loan that my dad co-signed. I financed about 55K in improvements and so ended up with a loan of almost 120K. I overpaid on the improvements (like most first time projects), but had so much room that it ended up fine.

My PITI was $1200. I moved in and rented the other 3 rooms out at $400 each, so I was living rent-free. Immediately after fixup I guesstimate the value was in the 250K range.

Ultimately I sold the house 7 years later for $380K when we moved to California. I didn't want to be an absentee landlord.

Interestingly, one of my original roommates purchased a duplex and now owns multiple rentals. I haven't done anything more than purchase a home for primary use, as I was going through residency and fellowship. I kick myself for not doing anything during the fallout from the crash, when properties were there for the taking. I am now looking to build a buy-and-hold portfolio of rental properties. I am a little unsure whether I want to go turnkey route or be more involved in something nearby - maybe a BRRR, then move up to small multifamilies. I live in Altadena (Pasadena) and work in Whittier and downtown, so that area is an obvious choice. However, the Riverside/Lancaster areas provide a lower price point and probably better rent/price ratios.