All Forum Posts by: Crystal Francis

Hi @Samir S.!  I am an agent and investor living in Folsom, CA.  Please let me know if you and your wife have any questions about Folsom or if I can show you any properties when you are in the area.  I'm happy to help and share my area expertise!

Hi Embert!

I sent you a PM.  I was actually looking at duplexes in Carmichael for a while myself- tough market for sure!  I look forward to hearing from you!

Hi BP community!

We have been trying to buy a duplex, but have so far been unsuccessful (not a lot of inventory that meets our criteria).  We're currently looking at two attached half-plexes, so essentially a duplex, but they are separated properties.  We are interested in financing our duplex purchase as owner-occupants, but I'm not sure how this might work with two separated half-plexes.  Does anyone have experience with this?

Thanks everyone for your inputs! I appreciate the variety of approaches and perspectives here.

@Chris Vail - Thanks for providing the details of your analysis. We're doing something fairly similar to both help identify potential properties and to back out a max purchase price for properties we are interested in. I like your input of cash on cash return, so I'm going to add that to my spreadsheet :)

@Tom V. - I like the comparison of real estate investment returns to bond quality. That really helps capture some of my thoughts in choosing the kinds of property I would like to buy. Especially since I'm looking to owner-occupy, I'd rather purchase something nicer that maybe won't have *quite* as good a return on investment, but will attract a higher quality of tenant and be more likely to appreciate.

@Jordan Thibodeau @Jason Flynn - I definitely appreciate the discussion on timing. I have encountered quite a few listings/sellers in the current market who seem to be unrealistic about the value of their property. There may be some buyers willing to over-pay in this hot market, but that won't be us. Waiting is tough, but seems necessary right now =/

@Joe Bertolino - Thanks for the tip on Yuba City. We're not yet at the point where we are ready to buy out of area for those higher return buy and holds, but I really appreciate the heads up on that area.

@Ali Boone - I appreciate your honest opinion about CA. No worries, my hopes and dreams are still alive and well, but benefiting from the feedback and conversations here. Buying out of state would be outside of my current comfort level, but it's helpful to know the different approaches people take.

I love this topic! When my husband and I first made the commitment to start investing in real estate, I was just finishing up a 3 year car lease and had learned my lesson on car payments and high insurance rates. Now we own two vehicles. 2001 Toyota camry with over 170k on it in awesome shape. We paid 5500 for it 4 years ago. We also have a 1991 Dodge Dakota with a long 8' bed, perfect for all of our moving and renovation projects. We paid 1800 for that 4 years ago. We'll probably drive them both into the ground :) When we succeed in financial independence, we will reward ourselves, but until then, our spending is all about ROI and neither of us care that much about what we drive.

@David Sanchez - got the tagging to work! I apologize that you were my guinea pig :)

Thank you all for your input! After posting, I realized that shortly after midnight might not have been the best time to start a new forum.

@David Sanchez (can't get the tagging thing to work!) - I am running the numbers as if I'm collecting rent on both sides- in order to evaluate the more long-term plan for the property. Also, I am willing to put in work. That is an area where my husband and I have some experience, so we'd actually prefer to find a property that could benefit from some updating. However, we area trying to preserve cash for our eventual rehab property goals, so we have to be careful how much we sink into our longer-term projects.

Hi everyone! I'm new to real estate investing/BiggerPockets, and I'm excited to have found such a great resource and community. In reading the Beginner's Guide, the 2% and 50% rules have me pretty concerned about finding an investment property in my local real estate market (Sacramento area). As a new investor, I like the idea of purchasing a duplex to owner-occupy and ease into this new world of landlording, but it seems VERY difficult to find properties that meet these criteria.

I have been monitoring the local market by identifying properties that I would be interested in purchasing (based on area, size, price, etc.) and recording their sale price and monthly rental income.

2% rule

I'm finding that the range of monthly rental income/purchase price is around .61-.78%, which is much lower than the recommended 2%. Bummer.

50% rule

Even if I model a loan with 20% down (which I was hoping not to do to preserve cash), I'm finding the expected monthly mortgage payments range from 50% up to 64% of the expected monthly rent. If I believe that the expected expenses of the property will be about 50% of the monthly rent, then the properties I am considering would be cash flow neutral, at best. Even BIGGER bummer.

I'm interested to hear how many people adhere to the "rules" or whether you have developed your own criteria. I'm torn between wanting to get started already and not wanting to be a foolish first-time investor. Any input is much appreciated!