All Forum Posts by: Daniel Zapata

Hi Randy,

In the rental calculator there is a sharing options button towards the top. You should be able to share on the forums through that.

Congratulations on making the jump!

Can you share any lessons learned? What are your next steps?

There were some restrictions already put in place last year: https://www.sacbee.com/news/lo...

Prop 21 would just expand even more rent control powers to the government, IIRC

Re: pricing rents: I've had good luck with Rentometer + asking my property management. I also scope out apartments.com to see the condition of the units vs the rental price. I've read the same reports that the rental market is hot in Sacramento, but keep in mind Sacramento has lots of neighborhoods so your mileage may vary.

If you price too high, you will not get many applications, but it's hard to distinguish between pricing just right or too low as both should generate lots of interest.

Good luck!

Michael,

I'll be looking to cash-out refinance my Sacramento 6-plex in a few months and I just read a good book which breaks down the commercial loan process very well: 
Commercial Mortgages 101: Everything You Need to Know to Create a Winning Loan Request Package by Michael Reinhard

Good luck!

Another option would be to take advantage of low interest rates and do a cash out refi to put more of that equity to work. If you play around with the numbers you can try to maximize cash out and keep it cash flow neutral, assuming rents don't go much below where they are now.

Your tenants would be paying down the mortgage and you would potentially be making money on that equity.

Of course you want to be responsible and have ample reserves.

I would also factor in a capex fund for major repairs. Who pays utilities? I suggest trying the BP Rental Property calculator to get a better assessment, but it looks like a thin deal to me and I would likely pass.

Rent control will prohibit you from getting to market rents unless you turn over the tenants. Otherwise it would take you years of the limited incremental rent increases (5% + inflation). Once they are turned over, there will likely be non-trivial turnover costs.

Also consider how much money you will have deployed for that $105 cash flow (per unit?).

I'm going to add the new Nest thermostat devices as I retrofit one of my buildings for central HVAC. I think it will stand out a little more and tenants don't have to use the online features. Additionally, the power company offers a $50 rebate for each one purchased.

Quicken has been ok for tracking property income and expenses per unit using tags and their built in reports.

However, I haven't found a good way to track repair, capex, and vacancy funds. I find myself pasting the data from the Quicken reports into a spreadsheet and the adding the fund information there. When I need to draw from the funds,  that information stays in the spreadsheet. For small multifamily properties, it doesn't seem worth it to open separate bank accounts for each fund type, especially for each property.

Can anyone share any tips? I'm open to switching accounting software to make this easier.

Hello Cody,

My first rental property as an investor was a condo in the bay area. I lived in it for a while, then kept it when I upgraded to a house. It didn't cash flow for the first two years (~$150/month), but the appreciation is awesome.

With condos you are trading off building/outside maintenance for HOA fees + regulation. There was a BP podcast a while back where someone was a condo investor and had a lot of good insight.

Good luck!