All Forum Posts by: Darius Ogloza

There are two foundational questions every investor needs to answer that will define the approach they take.  First, how are you going to get money?  What resources do you personally own or, through your connections (friends and family, banks, etc) have access to?  Are you a Bezos or hang out with Jeff Bezos?  Are you a schlump living on a friend's sofain a cold water flat in Scranton PA?  Second, what do you bring to the table?  In other words, why do you the guys with money and the guys with experience need you?   What makes you relevant?  Do you have superior analytical abilities? A better nose for finding deals?  Some special access to sellers?  

These are the kinds of questions newbies should be asking.     

From my limited experience seeing turnkey companies in Rochester NY in action, I tend to be a skeptic but try to keep an open mind.  Can anyone share some numbers based on their experience over 3-5 years?  This is the most persuasive kind of evidence.  

I would focus on fixers in southern Marin, of which there are still many scattered about in various states of disrepair.  Having lived here since 1994, through two substantial downturns, I have observed a stability and resilience to this region's housing that is really pretty amazing.  I would also consider the Ross Valley (San Anselmo and the Terra Linda area in San Rafael.  Same strategy.  Fix and hold/rent out.      

Amit & Robert: "treat people like children" - welcome to the socialist future . . . .  

Is your buyer a couple with children of different genders or a childless couple that wants a shared office space but wants separate his/her baths?  You can never know for sure who is looking to buy at any moment but analyzing local demographics is a good first step toward resolving this kind of issue.  My default is to leave the property as is but to show (through e.g., construction bids, architectural plans, planning letters) that conversion to a more desired set-up is possible   

Understood.  Thanks for sharing.  My wife is from Toledo (Northwood, to be exact) and we met at Bowling Green State in the 1980's.  We live in the SF Bay Area and have been investing in real estate since the late 1990's.  Our focus has mainly been on high growth markets in Marin, San Francisco and Yolo counties (UC Davis territory), SW Florida and most recently Las Vegas.  We get back to Toledo a few times a year as my mother-in-law still lives in Northwood and we are strongly considering adding add some "bonds" to our mostly "stock" portfolio.   Our one foray into strictly cash flow investing was in Rochester NY between 2004 and 2014.  The investments performed well, but we ran into management issues and cashed out.   

Andrew: thanks for your great insights.  You did not mention the Franklin Park area - 43615.  What is your opinion of that area as an investment zone? 

Tobias Stoll = Troll

I agree with Bharath. Your PITI here is $505/month. You will be incurring those expenses every month. This will leave you with $245 in cash to cover all of your variable expenses, including management. I personally have never seen a manager take less than 10% (granted, I have no personal experience in SD or in MO but I would be beyond surprised if you could get someone to manage a SFR for less than $75/month and trust you are getting more than lip service). This will leave you with $2,040 in annual free cash to cover repairs, maintenance, vacancies and other variables you may encounter. SD winters are harsh. For example, if the roof fails you will be out 4-5 years of "profit."

Stephanie: naturally, a party who is putting up ALL of the cash ($625,000 in this case) would not be happy with a less than 1/5 interest of the deal.  How do you otherwise compensate the investor to get him/her to buy into such a deal?