All Forum Posts by: Account Closed

Any responses?

@Ellyn Bussey 

It depends who you are targeting.  The original source of the list is always best.

If you're targeting property owners in certain county, you can usually purchase a list from the local appraisal district.

@Marci Stein 

If you're buying for resell, then the same is generally true. There will be no buyers with small kids.  Homes on highways are not generally very family friendly.

@Marci Stein 

What do you think?

Not sure if you have a husband and small kids, but if you did would you consider this a home you'd want for your family (is it safe, close schools, parks, etc.)?

If you're going to be leasing this, your cutting out all families with small kids. They will not rent this. 

I would also suggest conducting demographic research. Who will likely be your tenant(s)? Where will they work? Since, you wont have tenants with small kids, how many single adults with no kids exist in this market?  How highly are they paid?  While those types of tenants (with no kids) find this particular house attractive?

If all "nos", don't buy it.

@Nhi Nguyen 

Please disregard my prior comment.  That was more of a summary for San Francisco.

The 3Q14 market cycle report below shows that San Jose already hit a bottom and is entering the expansion phase.  Although this is just one source of information, if your particular deal has merit I'd say it would be worth taking the risk to build the project.

@Nhi Nguyen 

My educated guess based on market cycle analysis... San Jose is at a peak coming down.

Tech has stretched out the market cycle, but I'd be nervous and wouldn't expect price growth to continue much further.  Not the best market in which to begin building projects.  I would imagine you'd want to be building only in expanding markets.

@Jeff J.

If (1) the property cash flows and (2) you have plans of acquiring additional property, I would keep the leverage on the property and use the capital to acquire additional investments.  Considering that you are retired, if you can live comfortably off of this property and would like to lower your risk, you could consider paying the loan off.  I wouldn't be concerned with the legal risk.  Just make sure you have a reputable property manager managing it, have insurance that covers the property manager and any other agents, and you're conducting good business and treating your residents well.

@Andrey Y.

I believe it is a sin to waste time, money, food and other scarce resources.  I've developed this belief over time learning from more successful wealthy individuals and less successful people.

If you neither waste time or money, you will become a millionaire.

When spending...do you WANT it or do you NEED it?

If you WANT it. How much JOY would it add to your life?

If you NEED it, make absolutely sure you derive maximum value from it.

Based on my 10+ years investment experience, I've come to the firm conclusion that there is no such thing as a "nothing" down transaction.  To clarify, I am not saying that you cannot get a deal down with no cash down.  What I am saying is unless the seller is extremely desperate and he/she will pay you to take the property (ex. property with environmental hazards, etc.), you must contribute one of the following to get a deal done:

Land (The Deal): 

You can locate a really good deal, conduct the due diligence, draft the investment summary, locate a reputable property manager, obtain debt financing quotes and raise equity to close the transaction.

Labor (The Expertise/Property Management):

You can locate a capital partner who has a deal and provide property management services to increase the value and generate an attractive return to investors.  Many people who have run property management companies end up becoming investment managers when they realize how critical property management is in value creation. 

Another example are lawyers experienced in complex real estate transactions who exchange their services for part of a deal.  

Capital (The Cash):

This one is self-explanatory. Cash is king.  If you have capital, you shouldn't have much trouble locating labor and, by partnering with someone who's got experience, an attractive deal.

@Account Closed 

You can't. And you are not in a buyers market.