All Forum Posts by: Account Closed

@Mike D'Arrigo

Totally agree. 

@Tahra Wright

Thanks Tahra. Yes that helps. Besides our own backyard (keep in mind all I am pulling with is off MLS) I have done numbers, with the BP calculator along with my wife on every property currently available. So I have been researching other areas, which of course takes longer because I'm not just running numbers but looking at true vacancy rates, unemployment, job growth, local industries, etc... I have not gotten to the point of reaching out to any real estate agents or management companies, except for our own backyard. We have found some possible alright properties in our area but they get snatched up pretty fast (even the not alright properties). We are currently finishing up the loan process and then possibly starting the a heloc process so trying to take baby steps. I think when financing is clear and I have a bit more research I'll reach out to management and realtors as you suggest. I work full time in a pretty demanding job but trying to run numbers 2-3 times a day and make sure I giving adequate CAPX/ management/ repair percentages as I know in renting properties in the past I wasn't so accurate. Thanks for the advice and I think I am on the right track. I just want options when it's time to pull the trigger!! Your post was super helpful!!

Hey Aristotle. I grew up in Orange County and actually live back and forth between LA and Seattle (work in the film business). We owned our own SFR and another for rent in the Long Beach area for years so I am very familiar with numbers not working in Southern California. Where are you finding good deals and are you basing that on factors like unemployment, vacancy rates, etc.. I am of course on the fence but using the calculator to on BP to find deals.

Thanks Brian. Yes we have been leaning towards our area for those reasons. Yet I get thrown off on how many podcasts with people being very successful out of state. Appreciation is good. And some have a minimal cashflow in areas outside Seattle. They just move fast... even the junk. 

Completely on the fence. Looking for a multi. My area, South of Seattle, seems still very high. I think I ran a calculator on several properties and they are all a pretty big "NO". Trying to gauge the market as it's slowing down, yet the properties that were "No" are now already pending. Any suggestions on areas in other states that have deals, but also enough infrastructure to find good management and renters. I was dialed in with that in both LA and Seattle, but it took a few rounds with different contractors to get there. Current plan is to get two multiplexes in the next year using a combo of Heloc and cash as down payments. So much of me wants it in my area and to manage... but the numbers. Even REO's are ridiculously out priced. I am super conservative on my numbers as I have lived in and flipped 3 properties and at first really miscalculated repairs. Figuring out a job and material/labor is a no brainer now.It's usually what's behind the wall or finding unseen problems that has me now always adding 20%. Goal is 40 doors in next 5 years and an area that can provide that. THANKS!!

@Kyle Hassig I wouldn't have bought a property in 2005 right before the market got destroyed. But unlike most I bought a place I could afford and lived through it. Lenders we're offering me whatever I wanted and telling me I could just resell in a few months and make a killing. I said if they could put that in legelase I'd definitely take the money but it usually ended the conversation. I think I'm wiser and can see the writing on the wall and smell a crash coming. And speaking of a crash coming... Happy 2019. I'm being a bit more patient now and following numbers and the market. Sometimes it pays to be careful. Action doesn't have to be a deal for my situation but more a chance to educate, plot and strike when everyone gets frantic.

@Mary M.

Podcast is great. Chalk full of info. I may need to re-listen with a notepad. Thanks Again!

@Adrian Chu thanks Adrian. Love it here but still working on and off in LA. Looking at investing more a d trying to gobble up information here!

@Mary M.

Thanks again Mary! I'll give this podcast a listen to at the gym tonight!!

Investment Info:

Single-family residence buy & hold investment in Tacoma.

Purchase price: $205,000
Cash invested: $90,000

Bought this house while we were living in Long Beach, Ca. It was done doing a 1031 exchange with a condo we owned in Long Beach we were renting. We now live in this house free and clear.

What made you interested in investing in this type of deal?

We wanted to live in the Seattle area at some point as my wife grew up here. We basically came up and drove around areas we could afford and settled on Tacoma. Though, at the time everyone up here thought we were crazy because Tacoma 5 years ago had a pretty bad stigma. But we saw the potential, coming from Los Angeles, and seeing so many "rough areas" come up overnight. Now everyone thinks it was the best idea ever to invest here and hoping to continue with a small mulitplex soon!

How did you find this deal and how did you negotiate it?

It was a 1031 so it was a bit difficult. I wont get into the difficulties but it was basically hard to negotiate due to the fact the seller knows you are on a limited time frame and that you have to go with 1-3 properties you have picked. I learned a bit about 1031, but do not think I would do it again just for a SFR.

How did you finance this deal?

Traditional with over 20 percent down.

How did you add value to the deal?

Studied the rent in the area vs. cost of mortgage to make sure we would cash flow. Though we owned a smaller rental we didn't know much about what we were doing. In fact, we still don't but trying to learn more.

What was the outcome?

Great. We live in the house now, without a mortgage. That was one of our biggest goals was to live in a house without a payment. Not sure if it's the best thing to do for investing but I know it gives me peace of mind coming from LA where the homeless population is massive, rent is high and rising and debt to income ratio is bananas there.

Lessons learned? Challenges?

Hearing the word 1031 makes me ill now. In hindsight for the time, I wish we would have bought a duplex or triplex for increased cash flow. Self managing a place from out of state is rough. We paid a bit for small repairs. I've always worked on and fixed up our own properties as well is our rental in Southern California so it's painful to pay for small repairs I am capable of doing.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We did. He was great. He just covered the paperwork and we did all the finding and footwork. Been a while and need to find his name.