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Updated almost 6 years ago on . Most recent reply

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49
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David Vander Pol
  • Union City, CA
12
Votes |
49
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Analysis paralysis.....sort of?

David Vander Pol
  • Union City, CA
Posted

This is a two-part question. 

So....

I've spent some time analyzing as many deals as I can the past few months. Probably 50+ or so. Not a huge amount, but not a little amount either. Pretty much all of them are sourced from the MLS. 

Here's my problem, out of all of the listings, I've made zero offers because the numbers don't work. So I know I need to make tons of more offers on places, but I'm not going to do that JUST to make more offers. That seems nonsensical-it seems to make sense to only make offers where the numbers work. Right? Yet, here I am heading in a direction that seems to have analysis paralysis written all over it. I see/here people jumping in and after six months they've already loaded up on a few properties. So what am I missing?

The other part to this–the rehab costs on practically every analysis I do tend to land in the same area cost-wise. Typically in the 25k-30k range. Since pretty much every analysis I do seems to not work out numbers-wise, I'm beginning to wonder if my numbers are way off for some reason? I take my figures directly from The Book on Estimating Rehab Costs and judge as best I can from the pics/vid provided by my agent.

Again, what am I missing that is preventing me from being the person that gets a few properties under their belt in six months?

Any input would be greatly appreciated.

Thanks!

-Dave

  • David Vander Pol
  • Most Popular Reply

    User Stats

    6,080
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    Dan H.
    • Investor
    • Poway, CA
    7,018
    Votes |
    6,080
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    Dan H.
    • Investor
    • Poway, CA
    Replied

    Retail purchase off the MLS in the San Fran area is going to have negative cash flow. This implies you cannot simply find an RE on the MLS that will have positive cash flow.

    So look at alternatives. Off market deals, value adds (rehabs, add ADU, etc.), converting to STR, house hacking, etc.

    It is not easy in the high end markets for novice investors. The competition is significant. Many can afford negative cash flow for the appreciation play (market and rent appreciation). You need to work hard/smart to be able to compete with investors with Bigger Pockets.

    Good luck

  • Dan H.
  • Loading replies...