All Forum Posts by: Felix Piper

I really appreciate all the input. I didn't expect so many points of view, but it does sound like for my particular situation, stocks/options would benefit me more. As some of you mentioned, diversity is probably the way to go. I will probably look into allocating a small percentage to real estate, especially for the tax advantages that you can't get in stocks. I just don't look forward to being a property manager…

@Nathan A., I agree RE is more work, which is the reason for my post.

@Eliott Elias, as I mention on my post, I made 20% last year when the market went down, so the nice thing about stock, more specifically options, you could make money either way.

@Jon Puente, I sell options which is more active, but not as active I expect RE to be.

@Scott E., thanks your input. I agree, it would be a good idea to diversify into both for specially for the tax benefits.

@Jacob St. Martin, you make a lot of good points, but I've been looking in CA in it is difficult to get good cash flow. I actually don't own many stocks, I sell options, which provides me with a great cash flow - the 20% is my stocks cash flow, not appreciation. The tax savings is the game changer for me, in my opinion. I could offset stock gains with real estate. With options, you could definitely leverage, there are trades for any risk appetite, but maybe it is not leveraged as much as RE.

@Duriel Taylor, you make a point that everyone will need a home, but there will also always be companies to invest in as well.

@John Mathew, the illiquidity of RE is another reason that deters me, but it's ok to invest money I would not need. As mentioned above with options, I can generate a nice cash flow, so wouldn't be a reason for me.

@Robert Reynolds, I meant investment property, not primary residence. Regarding stocks, I mainly trade options (more specifically sell them) and you definitely could use leverage. There are trades for any risk appetite. The only advantage I see in rei, are the tax benefits, but not sure if that compensates. 

We have been debating whether to jump into real estate and deal with tenants and all the other nuisances that comes with property ownership, when we have been happy making 20% in the stock market (and that's last year in a bear market!). Would love to hear from others that may also invest in the stock market and what are the pros and cons to jump into rei.

I'm also looking into doing the same thing! Seems like it is a trend now. 

A little background first: wife and I have good jobs as professionals; live in the Los Angeles area; I have a CA real estate broker's license; Wife is w-2; I am self-employed; had a couple condos years ago, but did not enjoy the property management part; have been successfully investing in the stock market for a few years (even this year!); looking to diversify into real estate again, but not sure where to begin; should have about $300k to $400k to invest; here are the options we have been looking into:

1) Our top option would be if our landlord sells us the 4-plex we currently live in, but it will definitely not cash-flow. Had an idea of turning the garages into ADU's for extra income. Pros: possibly a good deal, since we're friends with the elderly landlord; could do less down with FHA, but payments would be double what we currently pay in rent (including the rent of other units) and would not cash flow; would have enough leftover to build the 1-bedroom ADU; Cons: no cash-flow;

2) Buy outside LA County, but still in California. Still with the idea of looking for a place to add an ADU to add value. Pros: better appreciation than other states; possibly positive cash flow; broker commissions; Cons: property management by others (added expense);

3) Buy outside CA. Pros: possibly could buy multiple or bigger property; better cash flow; Cons: property management; no commission; not familiar with areas;

I am mainly thinking out loud and jotted down some ideas. Any input would be helpful. Specially on good up and coming areas to invest in.

Thank you!

My wife and I live in 4-plex that we are hoping to buy. Each unit has a one car garage. My hope is to turn the garages into an ADU or another unit. We have enough to put 25% down and make the investment positive cash flow if we move out, but won't have enough left over to build out the garages. I would rather put less down (since we would be able to buy as a primary residence), say 3 or 5%, then build out the garages. Wondering if anyone had any thoughts or suggestions on this.