All Forum Posts by: Brandon S.

Hi all,

Shopping around for property insurance for a rental property... looking for recommendations on policy limits and features to look for!

Here are some basics on the property: Single Family Home, one story, 3BR/1.75BA, attached 2 car-garage, ~1100 sq ft., built in 1980, no pool.

Would love to answers to the questions below (in addition to whatever else you guys may have tucked away in your brains!):

• What type is recommended? (I've heard HO-3 being common?)
• Is replacement-cost insurance recommended on a rental?
• Lots of quotes I have gotten don't cover personal property at all, since it's a rental, I'm thinking that's fine?
• Loss of use - what recommendations here on policy limits (based on rents at about $2200/month)?
• Medical is only $1000/person on all my quotes. Is this good enough?
• Liability is about $300k on most of my quotes. Is this good enough?
• What companies are known to be extremely painful to deal with when making a claim?
• What are some small things to look for in the fine print that could be a deal breaker?
• Recommended deductible: $1,000 or $2500 ?

That's all I have for now. Thanks in advance!!!

Wow! I thank everyone for giving me such great responses! A lot to think about and ultimately, sit down and learn about.

Been exposed to the idea of using a turnkey provider for out-state/out-of-market investing vs. venturing out on my own*.

Just wondering the following:

• Pros (e.g., less headaches)
• Cons (e.g., eats into your returns, likely to learn less)
• Typical services they provide (e.g., tenant search, property management)
• Typical costs (e.g., flat fee, percentage of rents)
• Things to look for when looking for a reputable firm (e.g., performance of their portfolio, customer testimonials, first impressions, integrity, etc.)

Lots more to think about but just thought I'd jot these guys down! Thanks.

*I am a newbie to local investing, let alone out of state.

@Matt R. - great thoughts. Can't get the returns you want without exposing yourself to some types of risk.

@Karen Margrave - great points as well. There is a reason why I choose to live in such an expensive area. I LOVE IT HERE!

@Kimberly T. - thanks for sharing your experiences. Would love to hear more about your experiences on venturing into different markets without a TK provider!

@Marco Santarelli - great advice. I completely agree with your thoughts on 'banking on appreciation.' Like @Ali Boone said, just ask the speculators in 2009 how they are feeling. I think the only time you can possibly become a speculator is when you have already reached your wealth-buliding number and that kind of risk is simply because you literally can afford to. That's probably why OC price-to-rent ratios are all off since there are so many people with great wealth here.

@Jake Kucheck - thanks for your thoughts! I totally see what you mean but I was referring directly to the LA/OC markets and particularly residential properties with conventional financing (sorry I wasn't clear there). If I happen to find a property that brings in $6750/month in rent, I will most definitely be buying that! :)

Thank you everyone for the overwhelming response and tips!

Just to summarize,

Direct Investment Alternatives:

• Go out-of-this-market:
  • TK properties with a reputable firm (e.g., mid-west)
• If I stay in this market, go the less-trodden path
  • Find a "fixer" and put some "sweat equity" into the home to increase rents or possibly even flip the thing

Indirect Investment Alternatives:

• Real Estate Investment Trusts
• Become a hard-money lender
• Possibly buy-up mortgage notes

@Mike S.

Hi all,

I just met with my RE agent and surprise, surprise, based on the pre-approval that I got from our broker, I could not find any properties that I could positive cash flow with unless I put more than 20% down in "decent" neighborhoods.

For you SoCal investors out there, where alternatives are you looking at? Of course, being optimistic, I would love to just bank on the idea of appreciation but I'm a bit conservative and that just seems like a foolish gamble.

tl;dr - No cash flow properties unless I put a lot down. What other markets/investment vehicles to look at?

Thanks everybody for the warm welcomes and quick tips!

Hi everyone,

I hope you all are having a great start to your weekend!

My name is Brandon and as the subject post states, I am a newbie to the world of real estate. I was born and raised in beautiful Orange County, CA and I work as business consultant that travels usually 4 out of 5 work days (M-Th) out of the week. My travels range from in-state to international travel depending on the clients I work with.

My goals in real estate and finance in general is just trying to make sound investments that can give me a decent annual return (an annual decent return to me being a minimum of 6-8% depending on the type of investment). I'm hoping that real estate can be a strong catalyst and vehicle for me a reach a specific number I have set for my personal net worth and liquidity. This number is what I believe will give me the financial flexibility and lifestyle that will be desired by me and my future family.

In terms of real estate, I am particularly interested in multi-family homes and since I am working toward my first deal, I would like this property to be in Orange County so that I can possibly live in it as well with my-soon-to-be wife to gain all the benefits of owner occupied financing, homestead exceptions, etc. I'm currently 25 so my strategy will likely be a hybridized version of buy & hold (depending on how the market turns and the inevitable "life events"). I am a big fan of DIY and I know YouTube and BiggerPockets will teach me a lot!

Some things that I am concerned about (so far at least):
1. The Traveling Landlord - How to be a "good" landlord while traveling the majority of the week [ANY TRAVELING LANDLORDS OUT THERE? Would love to hear about your experiences :) ]

2. Investing in a expensive area - Finding quality multi-family homes in a very expensive area (orange county, CA) (quality = SHORT TERM RESULTS such as cash flow, tax benefits, etc. + LONG TERM RESULTS such as property appreciation)

3. Knowledge Capital - There is just so much to learn and I sometimes work a lot so if possible, what are some good resources (outside of BiggerPockets) to learn about multi-family units? I have already learned a great deal from some books I've read but I'm always hungry for more!

4. Mentor - a cousin to #3. I would love to get a real estate mentor but of course, haven't gotten around to doing that yet. Tips here are welcome!

Wow! That introduction turned out to be quite long. Thanks for those who were able to get this far. :) I look forward to becoming a more active member of this community and I thank all of you in advance for just dropping a line or even some quick tips on this initial post. Thanks!