All Forum Posts by: David Fals

Wondering if anyone could help out with an advice 

I am looking to purchase Real Estate. I have about 75k in HYSA and an Investment account combined. I also got 40k in my 401k.

I was thinking, should I invest in RE or continue to save? I recently got preapproved for $450k, and I own a primary residence (a condo that appreciated from $250-310k). I’m looking at PA, DE, CT, or MD, for multifamily homes (if possible). I'm based in NJ it's so expensive here. I chose those locations because I would like to drive to the property.

Is it worth it with less than $100k+ for a downpayment, plus closing cost, vacancy, renovations, etc Also, that's all my savings, which means my Emergency fund will be depleted. However, I have my job and side hustle still bringing in income. I'm so confused. 

How do you guys make that first investment?

I've been reading through, and I'm also NJ-based; I'm scared of out-of-state. I have some money for a downpayment (I have a primary residence), but the prices here are astronomical, and a listing gets multiple offers while cash eventually wins! I feel perplexed. I've been looking at the Lehigh Valley, PA, but I can't see any MFR deals. I have no 100k lol. It took me a while to save this, and I want to get into REI.

Quote from @Annwar Matani:

Hi everyone. I am a new out of state investor so I feel like my head is all over the place. I have read the BRRR book by David Greene and follow the forums, and listen to the podcasts. I feel like I have an idea but I think I am stuck in analysis paralysis at this point LOL. Also extremely nervous.

I am looking at different markets but I am interested in the Cleveland Market for various reasons, but most of all the low barrier of entry. I am from NJ so our market is more expensive. I have a primary residence in NJ that has equity, I have liquid cash around $50k, and my credit score is 740. I am debating on whether to just apply for a loan or use my equity/ cash to buy my first property? The strategy I would like to BRRR because I do want to scale in the long run. I am looking for cash flow.

 I am also trying to establish my team, I have a good realtor who is sending me properties, I was connected to a lender but I am open to suggestions/ recommendations for lenders, property managers, project manager (is this common?)  and (the one that makes me the most nervous) a RELIABLE GC. 

Where should I start? Thank you in advance. 

Hi, I'm in a similar situation as you. NJ-based, got some cash, purchased a condo almost two years ago, and need to invest ASAP but so scared of out-of-state! Turnkey might be the best to learn the ropes. 

Quote from @Russell Brazil:

 I do business in every state you mentioned and I prefer MD and Philly of them.

 Sounds like a good idea. I'll shoot you a DM

Quote from @Diane Bonheur:

Quote from @Greg McLaren:

Quote from @Diane Bonheur:

Hi everyone! Recent lurker and learner here. I'll cut straight to the chase - I have $100k cash and I'd really like to buy a 3 or 4 unit multifamily. Yesterday my job was eliminated, so my main source of income is gone, however, I have $1,425/mo coming in from a condo that's paid off. I spoke with my mortgage broker and she advised as long as the numbers make sense, I can still purchase an investment property. 

I was scouting out towns in Rockland and Orange Counties, but (as some of you may have already guessed), the prices of homes in the area are ridiculous. Based on my future goal(s), I'm aiming to purchase a multi with good cash flow and I don't think that'll be possible in the surrounding markets.

With that said, I'm considering looking into Pennsylvania and Delaware....maybe Jersey too? They're all within reasonable driving distances for me. I've been looking into all 3 states over the past few days but would love to connect with and hear from anyone familiar with the markets. 

Thanks in advance!

Hey Diane!  When it comes to NJ something to be aware of is the new 'lead based paint in residential dwellings' legislation.  It could potentially have some big cash flow consequences if you purchase a home that was built before 1978.. here is the state guide: https://www.nj.gov/dca/divisions/codes/resources/pdfs/lead_b...

 Thank you! NJ is looking like it won't be the ideal place for me to purchase a property. I've heard it isn't landlord friendly

Yes, I agree. I'm based in New Jersey and looking at out-of-state deals. The prices here are astronomical and overpriced. Also not being a landlord-friendly state makes it a bad idea. I got family that couldn't evict a tenant for almost a year that was extremely painful, and I wouldn't want to go through that. 

Investors from New Jersey and New York are finding it difficult to find affordable real estate deals as most companies are outpricing them. Although Philly is not a viable option, I am considering investing in Delaware, Connecticut or Maryland which is not too far away. As a beginner, I am looking for an opportunity to be involved and learn. I purchased my primary home two years ago and I am now looking to invest in another property for the purpose of investment.

Real Estate is not for everyone, but I want to take a chance at it. If it does not work out, I will consider the stock market which has more risk, but life is all about taking risks, right? Saving money in a high-yield savings account is not enough. I am all about taking risks, just like others that have made it.

Quote from @Michael P.:

Usually people saying there are no deals are just browsing Zillow instead of networking, bidding on auctions, working with wholesalers, etc. 

What auctions do you recommend? How does networking work or where do we meet wholesalers? All I got is Zillow 😩

Quote from @Vanessa Ivonne Hernandez:

@David Fals I'm in the same boat! I purchased a condo in 2020 in NJ and now I'm looking to grow my portfolio with out of state investments for the same reasons outlined on this thread. 

@Sino U. My research is leading me to PA or OH for my next property because I can get more bang for my buck. Moreso PA because I want to be driving distance since this will strictly be an investment property. I'm happy to share PA contacts that have helped me on my journey.

I have been considering investing in PA or MD, but I have learned that these states are not so landlord-friendly. However, they are located close enough to drive. I have also been exploring the option of investing in Ohio and Georgia, but I am not yet sure if I want to invest so far away.

Quote from @Justin A.:

It have done both types of investing over the last 15 years and this is where we're at. 

$100k into 401k type funds that are worth about $150k now.  

$30k down on our first house that's now a rental.  We have about $250k equity in it now (conservative estimate).  Our next house will need 20% down which will take twice as much cash but should still have a better cash on cash return than a 401k.  And that doesn't take into account the tax benefits of the rental. 

We only contribute to the 401k up to the employer match, just to diversify.  And the rest goes toward our next down payment on a rental.

Just my .02

I think I have decided on my plan. I won’t be maxing out my 401K contributions this year since my employer only matches 50% up to 6%. Instead, I plan to diversify my investments. I’m aiming to save 20%, but contributing more to my 401K would stretch my finances too thin, especially considering the need to maintain my emergency fund. Just for context, I’ve been saving and investing in ETFs and Index funds for the past 5 years and am currently working on catching up with the US financial system, being an immigrant. It’s a learning journey!