My first property am I ready to start my next property?

[John Rodriguez]

I am new to Biggerpockets I own a 4 unit apartment building in San Clemente CA. I purchased the property last year in July. This was my very first property I purchased with no experience in real estate or being a property manager. I manage it myself and I also work full time. I wanted to post a question that I already know the answer. I wanted to get other people's opinions. I am living in one of the units, my mortgage is getting paid by the other 3 units. I know I can increase my rents but I have some updates I could do to make the property look nicer, to increase my rents. What I want to do is buy another 4 unit property with a FHA loan. Should I invest the money in my own property or buy another 4 plex. Sorry about my post this is my first one any advise would be great thank you.

[Loren Becker]

@John Rodriguez 

Hi I would focus on another building.  Fixing up your building is great, but that may require some vacancy time.  

I've found that unless you are doing major renovations rentals make the same amount more or less and you are just taking dollars out of you pocket.

I would focus on figuring out market rent value on the current and future building to get an increase in revenue.  

good luck!

[Ben Wilkins]

@John Rodriguez - start saving up CapEx and maintenance percentages for your current property, then pay for the updates out of that. Stay in the habit of setting aside for those two expenses!

If you can get close-to-average rent with the property as-is, and if there are no major CapEx repairs or upgrades that need to be made, I would suggest purchasing the second property. This is assuming the upgrades that you mentioned are paint / lipstick kind of updates.

If your updates are larger CapEx projects, upgrade and repair before your property becomes rundown.

And if I forgot to mention before....... start saving CapEx and maintenance as a percentage of your income from the property!

What types of upgrades are you looking at doing?

[John Rodriguez]

I would like to install pavers but that would cost around $15,000. I don't have to go with pavers but currently there is a big patch of dirt on my property that looks very unpleasant.

[Joe Homs]

John Rodriguez Welcome to BP. There is a location where like minded investors gather in Lake Forest, California every month that you should check out.

If you would like to chat before then and talk about investing let me know. I am in Mission Viejo and can get together at my local Starbucks. Your ALL in cost is only a cup of coffee.

I am currently flipping homes in Orange County and teach others how to do so as well. I started a wholesaling group and spend my Saturday mornings with them.

I am looking for my next purchase at the court house steps, while I am working on a few more.

Good Investing...

[Michael Lucero]

This is sort of impossible to responsibly answer with no financial data provided, how are we to calculate the financial return under both scenarios? What is your choice that you said you already knew and what is it based on?

[John Rodriguez]

Thank you.

[Ron Hollingsworth]

$15,000 for pavers is preposterous!

[John Rodriguez]

That is the lowest offer I got. Other offers have been upwards of $25,000 the area is 2,000 square feet. I agree it is a a lot of money.