All Forum Posts by: Vickie Y.

Hi all, closing on my third rental property in the West Valley in less than a month. My latest property needs some light cosmetic work - new flooring (carpet and tile), interior paint, some interior doors to replace, and possibly new kitchen counter-tops.

Additionally, have another property that needs to be turned after tenants vacate at the end of the month. 

Would appreciate any good recommendations for a solid handyman in the area. Please feel free to send a DM or email. Thank you! 

Thanks guys, this is super helpful! A lot to think about! 

Hi guys, trying to decide the best way to go about this. 

Short version: 

Not enough liquid cash for down payment of 20% on Rental #3. Need about 35k. Have 90K equity in Rental #1 and 60k equity in Rental #2. Should I: a) HELOC one of the current rentals, b) take out an equity loan, c) do a cash out refi d) do nothing - continue saving until enough cash on hand.

Long version:

As stated, I have some equity built up in two of my out of state rentals. Both properties are currently on 30yr conventional loans at 4.875% and 5.25%. However, I made the mistake of not having enough liquid cash saved for the third rental. As most of my money is in the market, it seems silly to "sell low" in order to buy the third rental property. I've been looking into the idea of tapping into some of the equity built up, but am stuck on figuring out the best strategy. I would need about 35-40k for a down payment (20%) on a third rental. 

I think my options are: 

1) HELOC - draw down about 40k with the plan of paying this off quickly and aggressively, as the interest rate is adjustable

2) Home equity loan - loan at a fixed rate and term. From what I can see, loan terms can be as long as 10 years, so I would have the flexibility of paying this off slower if need be. 

3) Cash out refi - leaning away from this as I understand this would make my monthly payment go up. 

4) Do nothing - accumulate enough cash to jump back in - would sit out for about 6 - 12 months. 

Any insight would be greatly appreciated!! Thank you BP :) 

Awesome! I went to USC for both undergrad and graduate school, so it's great to see the improvements made over the last decade! Would love to learn more about what you're doing in this space.

Hello everyone!

I have been an out-of-state buy and hold investor for a couple years, but am looking to purchase my personal residence closer to home. The strategy is to manufacture a "house hack" by buying a property on a large (8000+) lot with a detached garage, which I can covert to an ADU. I would live in the ADU while renting out the front house.

Location: 

I'm planning to identify a property that would "work" with the ADU restrictions. Looking in cities that have more "lenient" ADU laws. So far, I've looked at Whittier, Buena Park, Pico Rivera, Lakewood, and Bellflower.

Financing: 

I would want to use a 203k loan to cover the costs of construction of the ADU along with the property itself. Downpayment of 5-10%.

Construction: 

This is where I'm a little stuck. I know about planning and permits but I'm a little lost as to where to start with that process. 

Here are my questions: 

1) Based off the cities identified, any red flags? 

2) Any catches with the 203k loan? Will this make my offer on a house "less attractive"? Are contractors paid then, by the bank? How does disbursement work? 

3) How should I approach the construction / permits? Should I go with a company that specializes in ADUs, or will a normal GC be able to handle it? What would be the pros and cons? Should the GC go with me to look at the property prior to my purchase? I'm hearing a price of about 100-150k quoted for a 1000 sqft 2 bedroom ADU - any ideas if this sounds reasonable?

4) (probably a dumb question) How exactly does an ADU differ from just "building a second house on your lot"? Or are there no differences?

I would love to hear about people's experience with this! Thanks in advance. Please feel free to tell me if I have left out any important details and I will be sure to fill them in. 

Hi @Wei Cho and @Michelle Kay! This is my exact question! I'm so glad to see that I'm not alone in this endeavor =) It seems like we are all relatively close to the LA area. Would you guys like to meet up at some time for coffee? (my treat!) I would love to pick your brains about your experiences and what challenges you have met along the way in pursuing the ADU route.

Hey Isaac, just wanted to say hi from a fellow Buena Parker :) Welcome, and if you ever want to chat about real estate, let me know! :) 

yes, the realtor not taking you seriously due to their perception of you not being a serious buyer is a real risk. But why not spin it so that you ask to learn from him? If this is someone that you feel you can learn from, offer to tag along to open houses, help out with marketing, take pictures for listings, etc. I'm sure he could use the help and teach you a few things along the way. pick his brain when you guys meet. show that you're a professional and serious, and not just screwing around. opportunities are everywhere, just ask :)

thanks @Daniel Y. ! @Chris Adams , feel free to shoot me a PM!

Hey Greg, welcome to BP. We're neighbors! :) I invest in rentals out of state. Wouldn't have been able to without the help of BP and the amazing people I've met through here. PM me and we can chat more!