All Forum Posts by: Becca F.

Hi Taylor, I sent you a DM. I'm not an agent but I'm also looking at Vegas and planning a trip out there. I agree with Nathan's post on looking at Facebook and Meet Up groups to connect with agents and investors. 

Great list! I've done a local major renovation. I made 36 payments as each job was done. There were several change orders. New electrical and plumbing were needed after doing the demo of the kitchen and bathrooms

On the buying materials, I did buy the kitchen cabinets (in-stock), countertops, bathroom vanities, tile and plumbing and light fixtures (not the recessed lights which the contractor bought). The delivery of the cabinets, countertops and vanities was a little problematic. I had to hire someone to deliver those to the site. The contractor didn't want to pick them - it was a 15 mile drive (in California traffic, this would take a lot of time). It wasn't a huge deal and it went well for being a first renovation after two other contractors flaked out on me and the third one wouldn't give me line item Scope of Work

The contractor bought everything else. So I shouldn't be buying those things listed above?  

I've seen two other contractors I talked to do this: it'll be $50,000 to re-do the kitchen, $20,000 to $30,000 for each bathroom (California) and "what's your budget? I'll make the numbers work" (Indianapolis) with no line item bids. For the California one, he wouldn't give me line item SOW - he literally wrote those numbers out on a detailed email I sent him. I could see the costs skyrocketing so I told him no thanks and kept looking. On the Indianapolis one, that's why I didn't do a BRRRR. Those seem like questionable practices to me.

Here are a few in the Bay Area on Meet Up. I think you need to sign up on Meet Up and RSVP: 

Tuesday, Nov. 12 Walnut Creek  at Rotator Taproom 6pm (short notice - it's tomorrow)

Thursday, Nov. 21 Oakland at Two Pitchers Brewing Company (hosted by Tyler Jahnke of Kenji Capital)

Saturday, Nov. 23 Tilden Nature Area, Berkeley hike at 10am (hosted by Tyler Jahnke of Kenji Capital)

Thursday Nov. 14 San Francisco - Happy Hour/Networking at Alchemist Bar and Lounge

Tuesday, Nov 19   San Francisco - 100% Funding for your Deal (Sports Basement at Stonestown Galleria mall)

https://www.meetup.com/bayarearei/events/304151177

Congratulations on owning 2 properties in California at 21 years old!

I agree with the other comments. I wouldn't do a flip or BRRRR right now. I've seen experienced investors do flips in the Bay Area. The open houses I attended for flips recently - their costs were around $300,000 for a major renovation in 2024. That's about what my major renovation cost (new electrical, plumbing, new exterior and interior paint) in 2022 but I bought in-stock cabinet, light fixtures and faucet fixtures myself. Since it was my first renovation I probably paid a little high. I rented the home out. I don't know what the market like is in SoCal but I would imagine that contractor costs aren't much less there in LA area than the Bay Area.

With @Dan H.'s point #11 about ADUs I looked into one for my SFH rental and adding an ADU (mine would be attached to the main house, not a separate structure) would cause my SFH rental to become a 2 unit and under rental control. There are some ways around the rent control issue in my location by making the ADU an STR (not a long term rental) and apply for a license to STR on the ADU. I haven't investigated this option yet. Your quote for an ADU sounds really low to me.

I'd recommend attending local real estate meet ups near you. You can talk to investors who have done flips and BRRRRs  and ADUs and ask them lots of questions so assess if either of those are viable options for you. Some of them might even will let you walk their projects. Good luck. 

I invest locally and OOS in the Indianapolis metro area. I have mixed results. 

My Class A (Indy suburb, great schools) has appreciated and rarely any problems. House was built in 2005 (I lived in this house and rented it out when I moved back to California). I bought this home in 2013 and also did a cash out refi during COVID so buy interest rate is 3.875%. I have great tenants but my property taxes have increased significantly so my net cash flow each month is reduced. I don't do large rent increases on my tenant because I don't want a unit turn. Right now I'm keeping it because of appreciation and not sure if I want to sell for now, would need to do 1031 exchange. 

Class C bought in 2023 on the East Side of Indy has not been great, repair calls 9 times out 12 months. House was built in 1920 and renovated by the seller. My net rental income was $300 to $500 a month, not enough to cover the mortgage payment (PITI) so I'm negative on what was supposed to cash flow on paper. I have property managers for the Indiana homes. The property is hopefully starting to stabilize after owning it more than 18 months - no repairs calls in 3 months. I sold the other Class C while it was vacant - I saw the writing on the wall so decided to cut my losses.

If I buy OOS it will be in Nevada, looking at the numbers and possibly renting out the house and moving into it later when I semi-retire. My recommendation for CA investors looking OOS is to look at the asset and ask yourself "would you live there?" If it's cheap, high crime area, proceed with caution. 

I'm doing value add and raising rent on Bay Area properties. I'm still a fan of West Coast appreciation although I know it's very difficult to buy in 2024 with very high prices.  I'm done with trying to scale OOS, too many headaches. Quality over quantity for me. I can "cash flow" more from my stocks/index funds and high yield savings account with far less stress. There's no one right answer for everyone since we all have different financial situations and risk tolerances. 

Great information. I would have saved few thousand dollars in inspection fees and appraisal fees if I had known that and I had a friend send me detailed videos.

I'm not sure if this information is available in all counties but where I bought in the Indianapolis metro area, I can look up property tax records. One experienced investor said to me that if it looks like a different LLC has owned a home every two years it's a bad sign that the property is being passed around from investor to investor. Although some investors don't have LLCs so it would be difficult to tell if it's owned by a primary homeowner vs an investor. Is this accurate, if a property is owned by investors and constantly being sold and bought that's a warning sign?

 I agree with the Sacramento area. I kind of looked in that area, haven't driven up there to look around. 

I also considered Nashville, Tennessee and Arizona. I visited Franklin and Brentwood, Tennessee more than 10 years ago - really nice suburbs but expensive now.  I know several California investors buying in Texas, specifically Dallas area, but they are doing a syndication to buy an apartment complex. If they bought a single family or 2 to 4 unit in Texas it was at least 5 years ago.  Even though property taxes are high in Texas, I guess they made the numbers work. 

I have a different goal from new investors. I'm not trying to scale or acquire "more doors".  I'm looking at the asset and RE as a store of wealth (as part of my overall investment portfolio) to pass onto my kids. I'm looking at Nevada, either Reno/Lake Tahoe or Las Vegas. Nevada has low property tax rates (as well as Arizona). I would rent out the Nevada property then later on, leave the Bay Area and move into the Nevada home to semi-retire (work on a part-time/contract basis) - there's no state income tax whereas California is taxing all my income, including rental income from my Indianapolis properties. I'm still working out the numbers and pros and cons. 

It depends on the meet up. I've gone to local meet ups and I haven't been pitched. A few of them have been real estate agents and one was very helpful in helping me with negotiating with the buyer in the Midwest (selling off a property). That really spoke to her integrity - she could have suggested I sell off my California single family rental and made a lot of commission off me. Many of them have given me advice on navigating landlord-tenant laws and things that are specific to different areas (e.g. investing in San Francisco is different from San Jose). 

It's been more about sharing our experiences and giving and asking for advice, especially helping out new investors. In the DMV area, there may be differences with how you would approach investing in different cities so maybe attending different meet ups in different areas, e.g investing in DC would be different from cities in Virginia, Maryland etc. (sorry I don't know the geography in that area on anything about investing there). 

@Tamera McNeil

I invest in the Bay Area. From talking to other investors here, I would lean towards the East Bay suburbs. San Francisco, Berkeley and Oakland have the most pro-tenant laws. If you get a higher income tenant (e.g engineer, tech worker, doctor, RN, etc) you may be able mitigate some risk. I wouldn't do any type of Section 8 or tenants with questionable income, if it were me. My tenants are higher income. 

San Jose and Santa Clara is appreciating a lot but it's very expensive to buy as in $1.5 million+. The Peninsula is more expensive than the East Bay (I'm highly biased towards the East Bay). I'm not a fan of buying anywhere near SFO with airplanes flying over you (or the tenant). If you find a deal on the Peninsula it's either distressed and needs a ton of renovation or not a good area. I know some people who are doing AirBnbs to get better cash flow - it's negative cash on long term rentals unless you're doing 50% down or paying all cash but most people are looking at California more for appreciation. Any community with an HOA will most likely prohibit any short term rentals.

 Feel free to DM me if you have questions or would like to talk further. 

I agree that finding a local mentor is much better than paying a social media coach/mentorship guru who is charging $500 (that's the cheapest I've seen) to over $20,000. I'm on Instagram and literally everyone is a real estate or investing (usually stocks/index funds) expert. I asked one of these coaches who said her rental income is $140,000 a year if that is the gross rental income or net rental income (after mortgage payments, property taxes, insurance, repairs, vacancies, capital expenses). This person manages her own properties so no property management fee. She won't respond to my comment and someone else asked her the same question LOL... If I told someone my gross rental income, it sounds impressive.  I'm still working my W2 job especially living in one of the most HCOL areas in the USA. 

My beginning mentors were two RE investor friends who did become retire early from W2 jobs by the age of 40 but they bought their properties in 2014 and going back to the late 1990s. Obviously you can't buy a coastal California property for a low price now so that their strategies don't work in 2024. They've given me advice more with property management and how to add value and look at the asset. 

I've been going to local RE meet ups and talked to other investors who have used many different strategies: out of state, syndications, NNN (triple net), commercial, AirBnbs, mid term rentals, co-ownership, house hacking, etc. Some of them have a lot more capital than I do and higher risk tolerances. There's no one right strategy for everyone - it's very individual. RE meetups that have helped me are very specific to San Francisco Bay Area market (sales and median rents in the last year and last quarter) so I'd recommend finding a meet up or session that might address your local market and if that's a viable option for you to invest in.