All Forum Posts by: Ewa Reza

Why on earth would you need sprinklers in triplex? I don't think I ever seen sprinkler system in small under 4 unit properties. More than that... even fire extinguishers are not required majority of time.

@Ron P. that's why I'm not sure why would anybody do a single member LLC?

My way of thinking is, if it's a partnership go for LLC, and if it's one member only, S Corp is better option. One way of the other you need LLC or S Corp when doing flips. Not as much for taxes, but for asset protection. 

My leases state clearly that tenant cannot use the premises to conduct any business. As @Roy N. mentioned she may not need a license but that's a separate issue  the way I see it. If she was my tenant she would be in a breach of contract. I would be concerned about insurance as @David Bruce pointed out. I'm assuming you have landlord insurance but kids obviously are prone to accidents. Something happens and you may get in trouble as insurance company may say you have not reported the property as a place of running business.

You're definitely right. Gotta consider market cycles. Looks like we may have another 2 years before everything takes a different direction. Appreciation already slowed down A LOT. The predictions for my area for example are less then half of the two previous years.

If you know you won't be holding the property long term, better sell this year. I'd wait for May/June though.

You have to take into consideration real estate market cycles. This year (maybe next one too) look like good time to sell. But in 3-4 years it may be different situation. I don't know about your area but mine - NE Los Angeles has very low projection of appreciation comparing to last 2 years - less than half. Since you have time and interest in flipping, I'd do it. Looks like for another year or so rehabbers in LA will be thriving...

Yes! Met her and had similar feelings. 

Welcome @Natasha Sadikin ! I think LA is a great place  for developer/architect. Or architect/rehabber for that matter! I'm getting my feet wet with a new construction this year... I've got small lot (4300SF) on a hillside that I want to build on. Exciting but very challenging :)

@Lee L. I used to work for commercial developer in DTLA and we tried doing marketing for Chinatown and failed miserably. These people did not want to deal with us. So I think you have a great advantage here! :) The old school, personal approach is best with them. A lot of these properties change hands without ever hitting MLS.

I have to say one thing though... vast majority of these properties are in need of some serious work.

You're looking into my neighborhood... Currently there's only one property I see here that is a "good deal" so I'm not sure what you're looking at exactly...You gotta pull the comps and present the owner with a fair offer based on these comps (include the comps with the offer). Since the property is on MLS, the owner's agent priced it based on comps so you need a black on white proof why your offer is lower. If it is a 4-unit and in decent shape it will sell in high 700s.

Don't disqualify Los Angeles just yet!

I'll give you one example / story that two of my friends /past clients went through...

One bought a triplex in Scottsdale 2 years ago. One bought triplex in LA. Doesn't matter the price difference. The difference was maybe $13K in their out of pocket expense.

Both held their properties for 2 years. AZ guy had a cash flow of $800 a month (approx $19K after 2 years). CA investor had no cash flow. They both sold. AZ had $70K profit, CA had $150K.

This means that this extra $13K made $60K extra profit within 2 years. Nice, ha? :)