All Forum Posts by: Cody L.

If you have a good deal in Houston you're welcome to message me. However, I get the foreclosure list every month. Are you talking about deals other than what's on there?

What specifically are you looking for in a partner? I'm sure cash is one thing. But what % of the overall deal. For example, the SA deal that's $600k + $400k. What % of the $1m are you bringing vs. needing to raise?

0 Votes

Houston, Texas

Quote from @Dan H.:

Quote from @Cody L.:

Quote from @Dan H.:

Quote from @Juan Mora:

I think the pricing is out of this world.

I bought a townhouse in Carlsbad in 2005 for $500k. It is now going for $920k and renting for $4300

this place sold for $180k in 2011 so I don’t see how it jumped to $775k in 12 years. Insane. Not even my Carlsbad place quadrupled in price.

My goal is to have my brother rent rhr smaller space and rent the bigger space for $2600-2800.

Hoping ti get some equity in 5-10 year.

You purchased shortly before the Great Recession (GR), they bought shortly after the GR.

The duplex I purchased in 2012 for $302k is worth over $1m.

note that duplex would produce higher rent than your $900k Carlsbad RE Also Chula Vista is gentrifying more than virtually all other San Diego communities This is because 1) the large bay front redevelopment 2) west Chula Vista is some of the cheapest bay/ocean property for many hundred miles 3) Chula Vista is unusual in coastal is less expensive than inland, this results in coastal Chula Vista possibly being an opportunity.

It is my belief the price is slightly high. I suspect it will sell between $730k to $760k.

Good luck

Crazy... Growing up in San Diego we used to call Chula Vista "Chula-juana" since it was basically like Mexico (a play on Tijuana for those outside of SD)

Parts of it still are, but with the large bay front development I suspect there will be less and less spots that are like that. That could result in all of west Chula Vista (CV) gentrifying. West CV is one of few areas where near bay is cheaper than inland. I suspect that will change.

IB is also potentially an opportunity. it is by far the cheapest ocean property in Southern Ca. Why? Sewer issues from the Tijuana river and proximity to the border. Sewer issues can be addressed with money. The local and national governments have been working to Improve the sewer issues. Money and time and the sewer problem will shrink enough that it is a fraction of the problem that it is today. If it gentrifies, proximity to the border will not be the negative that it currently is.

Like you I live in north county. Even though I have had a strong belief that those markets would and will outperform San Diego as a whole, it is outside my market (we own nothing significantly south of the hwy 8).

I don't live in North County. I did grow up in Escondido but moved to Pacific Beach as my first apartment. Then downtown. Then 'middletown' where I bought my first house (if you know where "Sassafras" is off India St.). Recently I moved from that Mission Hills / middtown location to more 'real mission hills' -- i.e. north of Washington. Sort of by Presidio Park.

0 Votes

San Diego, California

Quote from @Dan H.:

Quote from @Juan Mora:

I think the pricing is out of this world.

I bought a townhouse in Carlsbad in 2005 for $500k. It is now going for $920k and renting for $4300

this place sold for $180k in 2011 so I don’t see how it jumped to $775k in 12 years. Insane. Not even my Carlsbad place quadrupled in price.

My goal is to have my brother rent rhr smaller space and rent the bigger space for $2600-2800.

Hoping ti get some equity in 5-10 year.

You purchased shortly before the Great Recession (GR), they bought shortly after the GR.

The duplex I purchased in 2012 for $302k is worth over $1m.

It is my belief the price is slightly high. I suspect it will sell between $730k to $760k.

Good luck

Crazy... Growing up in San Diego we used to call Chula Vista "Chula-juana" since it was basically like Mexico (a play on Tijuana for those outside of SD)

0 Votes

San Diego, California

Quote from @Alex U.:

Cody, this is a great strategy akin to selling a naked put. Curious, how many times you have ended up owning the asset that you lent on?

zero times. Though I did have one deal where the guy partially paid me off, so I removed my lien on some of the properties. The rest of the loan was heavily secured by remaining properties. He stopped paying. I went to foreclose. His partner sued me to stop the foreclosure saying they didn't have his permission, etc. That's still an ongoing issue but pretty sure it'll resolve in my favor.

0 Votes

San Diego, California

Quote from @Keegan Wetzel:

Quote from @Cody L.:

Your best bet might be just to get a higher rate private loan (as you mentioned, 9%) and eat the higher payment until rates move down. Then refi.

I've been in that spot. Hopefully you've done the math and concluded that your higher borrowing cost is offset by what you're able to do with that capital.

I've started to do more and more private loans (to people like you) as they're safe and pay returns that are high on a risk adjusted basis.

Good luck!

Thanks @Cody L.

Are you lending just on Construction 2nd position loans? Or for first lien acquisitions as well? What rates are you getting on your money?

I'm not a lender by profession. I started doing lending when I'd get outbid on a property. Meaning I was doing a loan on a property that I wanted (and tried to buy) anyway. Thus if the loan went upside down, I'd be happy with the asset.

Example, I bid $4m on a property. Someone else bids $4.5m on a property. They get it. They ask me to do a loan for $3.5m. I say 'okay' since I get a nice return and if something goes wrong I can get the property at a basis that's lower than I was willing to pay.

Rates vary depending on risk, borrower, asset, etc. Most of my deals are low risk to me (due to the asset, as mentioned) and over around 8-10%.

I've done 1st liens on purchases, and I've done seconds when there is enough equity (i.e. I did one where a guy has a $2m property with $1m of debt -- I did a $500k loan. That's pretty safe to me even though I'm a second)

I don't want to do anything that messes with construction or draws or any of that. The most basic rule is my loan amount (or my loan + the 1st lien, if applicable) has to be less than I'd be happy to buy the property for

1 Vote

San Diego, California