All Forum Posts by: Dan P.

This is gold, guys, love the input!

 I am looking online at deals in Cleveland... am I missing something? There are multi-family units under $100k in pretty decent shape. How are these not snatched up right away? I can't imagine how they WOULDN'T cash flow!

Thanks all! What midwest cities would you put at the top of your list?

Hi BP world! I am looking to purchase my first residential multi-unit investment property, would prefer a tri-plex or 4-plex, but would be open to more units. I am located in the San Francisco Bay Area, and there is literally (close to) nothing that will cash flow positive right off the bat. I'd like to start investing, but I don't want to play the market timing game and potentially wait years until we see a dip in prices locally.

I have considered Fresno, Sacramento, and Phoenix because I am familiar with all of those areas. Any thoughts on those? What other markets should I be considering? Thanks in advance!

Hi BP world! I am looking to purchase my first residential multi-unit investment property, would prefer a tri-plex or 4-plex, but would be open to more units. I am located in the San Francisco Bay Area, and there is literally (close to) nothing that will cash flow positive right off the bat. I'd like to start investing, but I don't want to play the market timing game and potentially wait years until we see a dip in prices locally.

I have considered Fresno, Sacramento, and Phoenix because I am familiar with all of those areas. Any thoughts on those? What other markets should I be considering? Thanks in advance!

Thanks for the feedback, Greg. I am thinking that selling, holding onto the money, and waiting for better market conditions to invest may be the way to go. Not only do SFRs seem impossible to cash flow here in the Bay Area, but multi-family properties are becomingly increasingly difficult as well. I want the numbers to work, but they rarely seem to.

Thanks guys! Just to clarify I was looking at a 4-plex as an investment property only - not looking to occupy one of the units. Great advice so far!

Hey Everyone,

I am a residential mortgage lender taking my first dive into real estate investing. My main focus is cash flow to grow long-term passive income. I have always wanted to buy a 4-plex as my first investment property, but now I am analyzing another option. I currently owner-occupy my SFR in the SF Bay Area, and am trying to decide whether to turn it into a rental or sell it. I purchased it in 2014 with an FHA loan, and I plan on living here another 12-18 months before buying a new primary residence.

I could refinance into a 3.75% conventional and drop the PMI - current balance is $238k and value is right around $340k.

The numbers would look like this:

The mortgage plus all expenses comes out to $1754.72, and I could probably rent it out for about $1700 today. Now I know I don't cash flow positive off the bat, but I am trying to determine if this would be a good long-term investment with the way rents are trending in the Bay Area. I assumed a 5% income (rent) increase per year, 3% property value increase per year, and 3% expense increase per year.

Using these numbers, the BP calc shows that I would be cash flowing $150/mo by year 4 and $700/mo by year 10. Is that worth it?

Do my numbers look ridiculous? Does this look like a potential deal, or am I forcing it? Or should I sell it and keep the cash towards a multi-family property in the future?

Any feedback is welcomed, and I thank you in advance!

Ken Lee with Michael James Real Estate! I will message you his contact info. If you have any questions regarding lending, I'd be happy to help with that as well.

I know a couple of great agents in Sacramento and Fresno. Also, I am more than happy to help out with any lending questions you may have!