Part Time CA Investor - Looking to Buy 3 Properties - Class A

[Varun Parkash]

Hello, I am an IT Entrepreneur, IT Consultant and a part-time real estate investor, just signed up with BP, bought a brand-new condo property in Irvine CA 2 years ago in zip 92618 (educated myself on everything by talking to folks - google - some forums) as an investment, but the numbers aren't working in my favor and I have negative cash flow (2 mo initial vacancy and high HOA + special city taxes) = Negative 11k (1st year) to Negative 3k (2nd year). I may start breaking even in my 5th year and still not have ++ cash flow. So, the only thing I am backing on is appreciation.

The property has appreciated 8% over 2 years and I can break-even if I sell it now. It is tenant occupied (who are excellent - have a great credit score - good jobs etc. & want to renew their lease for the 3rd time). Rent goes up 3.5% every year. 

Currently, I am getting close to buying a second rental investment property in North Atlanta region. Once I am done with the closing on the 2nd investment rental property - I will be seeking out to do a 1031 exchange with a budget of $550-$650K.

I am looking for Class A properties (preferably SFR) that are in good school districts, with zero to minimum HOA & in developing neighborhoods with considerable chances of appreciation. I am open to diversifying my portfolio across different states or follow the traditional approach of buying 2-3 units in one state/city (this is where expert analysis from seniors/experienced members will help).

I do plan to get my CA real estate license sometime in future but for now, my next 6-9-month focus is to grab this second investment property and then work on selling the Irvine property by doing a 1031 exchange to generate ++ cash flow. 

Long-term (5 years) focus is to establish a portfolio of 5 condos, 5 SFR's = a total of 10 Class A properties in prime areas.

I look forward to learning in this great community about rental investments, foreclosures, networking, getting the best loans etc. 

Thanks ALL !