All Forum Posts by: Rob Cee

I'm also not there on the ground locally, so I would have to find someone locally to help me arrange something like a lease option.

What about Dodd Frank and all that stuff with selling financing?  What about evicting issues if they default on a LO?   I don't think I could get $10k down.  Maybe $4k-$5k down.

I have a negative cash flow property out of state I bought about 10 year ago that was a mistake before I knew better.  Trying to decide to take a big hit and sell it cheap or hold on to it and hope market recovers.   I owe $182k on it and can probably sell it for $165k right now.  So that plus real estate commissions and closing costs I will lose a big chunk of change.  The house was built in 1976 and has a dated kitchen and bath.  Roof likely needs to be replaced in a few years.  Furnace and water heater are old. Other things are dated.  It's in a decent location and has good curb appeal.  Rents well.  It has new flooring.  I've lost money on it every year the last 10 with negative cash flow.  

My options:

1. Pay off the 2nd mortgage and refinance the first where it will be slight positive cash flow (will require about $44k out of my pocket to pay the loans down to the point I can refi) and get it re-rented with professional property management.  The hope here is that in say 3 years the market will be better and I won't have to take as big a loss on a sale.  Issue here is the property needs a lot of work (roof, furnace, etc...), and in 3 years when IF the market improves I will still be selling a dated house and I may have to incur more costs then expected on maintenance, repair, updates.  I do think the market does have potential to recover some in price, but it's a big IF.  But I will be putting a lot more money into a property I don't want and was a mistake.

2. Just sell it cheap and take the loss.

I don't really want to do a lease option or real estate contract because of all the legal issues with getting a tenant out if they don't pay. And even then I'm likely to get the house back in the future and tenants may cause damage. It's not a good market to do a FSBO either to try and save on commission. Don't want to do a short sale and wreck my credit either.

Any thoughts and suggestions?  Which choice is better?  I have had great success in the years after learning the lessons from buying this first loser.  But I still have this albatross to deal with from a dumb decision I made 10 year ago.

Sam I sent you a colleague request so I can chat about this a little more.

Thanks for that info Sam. I think Bruni Karr is pretty big too. Amazingly I've managed my property myself for 9 years from out of state and I calculate I saved about $14,000 in property management fees over that time. But the friend that was helping me show the house moved out of ABQ. It's not that difficult to put an add on Craigslist, run credit, get paystubs, etc... But since I'm not local I do need someone to show the property, do 2 annual walk through's, and handle evictions if I have to.

I want to get some recommendations (from landlords) for property management companies and experiences. I own a rental there.

I'm not interested in a title company list. I just want to talk to landlords that live out of state but own rentals there.

I'm looking to chat and exchange info.

You profile says you live in Riverside. Your description does not sound like Riverside to me. When I think Riverside/Inland Empire I think brown hills, generic cookie cutter developments, endless freeways, strip centers full of all the same chain restaurants, no culture, car culture and baking hot summers. You couldn't pay me to live in Riverside or the Inland Empire (and the 10% surcharge on your income to live there).

Depends on what your definition of standard of living is. The average Joe in "Coastal CA"... Coastal SD, Coastal OC, Coastal LA, Bay Area making say $100k a year probably rents or lives in a small condo or apartment (unless they bought a long time ago). The standard of living in terms of housing is lower and they are living in a much, much smaller, lesser property then they could live in the rest of U.S. Or they commit a MUCH larger % of their income to housing if they live in a nicer place and therefore have less to spend on other things. And they also TAKE HOME a lot less money since they are paying the 10% state income tax, so they afford less other things to enhance their standard of living. So it is double jeopardy in CA...higher housing costs + super high income taxes. And I'm talking coastal CA. If you move to the Inland Empire or Central Valley it's cheaper housing, but that defeats the whole purpose of living in CA IMO as those areas are cookie cutter arm pits and hot as hell in summer...AND you are STILL paying a 10% state income tax. My point is that I thought for a long time I could not live outside CA, and I'm so glad I moved and I would never move back. And I think it is really worth looking into for a lot of people. CA may work for some and is no doubt a beautiful state with the combo of ocean/mnts/climate, but I honestly think many would be better off by taking the plunge and moving if they can. Too many people are house poor just to live in CA or live in crappy apts or small places, I personally don't think it's worth it.

I lived in both San Diego and the Bay Area for 25 yrs and I personally think it's overpriced and overrated for the cost of housing + income tax. With all the money I'm saving with NO state income tax and lower housing costs I can take luxury vacations all over the world to places much nicer than SoCal. I also think summers in Seattle are way better then ANYWHERE in CA period. It's green, lush, pristine natural lakes right in the city, tons of rivers everywhere, alpine hiking 30 min away, 70-75 degrees every day, snow capped peak views, beautiful walkable city, etc... vs. the bald brown bone dry hills of CA. I am a small business owner and can do my business from anywhere and make the same amount of money, so it makes no sense for me to live in CA and pay astronomical house prices and a 10% state income tax.