All Forum Posts by: Jay Orlauski

"Not enough tenants"  LOL - probably the funniest thing I've ever heard about the Fresno rental market. I just listed one of my units and had literally close to 25 people a day call or email about it and even though I already rented it last week - I'm still getting calls this week about it - and my tenant hasn't even moved out yet!  It will be vacant for about 3 days - I have never had a problem renting out our apartments here in Fresno  - in fact , in my experience of investing in multifamilies over the last 20 years - I feel we have a very strong rental market and my turn-around times are very minimal. Last time I turned a unit around - I had it rented before I even finished updating it. I've had some great tenants , some good ones and some bad ones -   I screen a lot better now so it's been a while since I've had bad tenants. Fresno is like any other city - it has the good parts , the bad parts, good people and bad people.  Prices seem low to "out of town"  investors from the coast who are used to million dollar studios but when you look at the rents compared to the cost of properties - you'll see that the cap rates are only around 4 1/2 - 6 % - most of the better deals are going to be found off market - though I sense a cool down is coming soon so there could be an opportunity to start picking up properties at an even better price.  Fresno has a large population - there are plenty of renters here - the problem is not finding tenants - it's finding a building that actually cash flows with a good cap rate.  

Great job Kevin! looks like you really have a handle on this - keep it the great work!  

Hello Melissa  - welcome to BP.  You'll find lots of friendly and helpful people here that are more than happy to answer questions and share their experiences. I can understand being nervous about meeting new people  - especially in a field that you are new too - you probably have this image of a bunch of sophisticated investors sitting around discussing their latest acquisitions and and using lots of confusing language  - but in reality real estate investors are some of the most humble people I've come across and these meetup groups are usually full of enthusiastic  well intentioned people like you who are eager to meet other like minded people to share their passion with. The make up of these groups is typically lots of newer investors , a few experienced investors, a couple of very experienced investors, and the rest are real estate agents, lenders, contractors, and people looking to grow their network.  I have met some excellent contacts by going to meetup groups - it's amazing how much information you can pick just by listening to what other people are doing. I've been investing if Fresno from the lats 20 years - the first 15 of those years I was on my own and I never spoke any other investor- once I started attending meetup groups and connecting with other like minded people- I wished I had  done it years ago.  I learned more over the last 5 years by connecting with others than I did the previous 15 years on my own - best of luck to you and I look forward to reading about your adventures. 

Hi Joseph - according to the Fresno Citywide Development Code - RMX is "Regional Mixed Use" 

RMX Regional Mixed-Use. The RMX district is intended to support regional retail and mixed-use development in large-scale activity centers outside of Downtown, as identified by the General Plan. It accommodates urban-scale mixed-use development that serve residents and businesses of the region at large. Medium-scale retail, housing, office, civic and entertainment uses, and shopping malls with large format or “big-box” retail are allowed, as are supporting uses such as gas stations, hotels, and residential in mixed-use or single-use buildings. Development and design standards will create a pedestrian orientation within centers and along major corridors, with parking located on the side or rear of, or within, major structures.

you can get more detail about it here: 

https://www.fresno.gov/darm/wp-content/uploads/sites/10/2016/11/FresnoCitywideDevelopmentCode.pdf

best of luck and let me know if I can help you with anything in Fresno area

Hi Darek -  turning around a property can go smoothly if you approach it the right way. when I was self managing - I have typically done much of the cleanup on my own such as cleaning and painting    - but often left bigger jobs to the pros. I would say a GC is not necessary  - it's a little overkill if you are just doing basic updates. 

wherever you get the flooring ( and I have some referrals  for you)  - they can install it  - so no need to worry about that.  countertops and cabinets can be installed very nicely by a qualified handyman  - you can bring a couple of them over to look at the job and give you a quote - ( again , I can refer you to a few people)  

From what you are describing - I am fully confident that you can manage the turnaround yourself. It's very similar to calling in a plumber to fix something except you just have a bigger list of things. Also  - feel free to give me a call and I would be happy to walk you through anything you have concerns about and can plug you in to some resources to help get you going.  I recently did exactly what you described about 11 months ago on my own personal unit and it was simply a matter of delegating the right tasks  to the right people. You will pay a much higher premium for a licensed GC  to delegate for you.  Just be sure that your handyman / installers have liability insurance. 

Let me  know how I can be a resource for you

I ALWAYS include management and vacancy when calculating CAP rates which is why realistically you are not going to find anything of quality over on the MLS with over 6% in Fresno - typical buildings here are getting closer to 4.5% to 5.25% - that's also the reason why I never pay attention to the numbers provided by the broker or the seller - I mean sure , I will look at them and run some numbers - have a good laff when I realize they have not included any major expenses and run their property for 4K a year ..lol. but then I look at what the actual expenses are likely to be based on experience and look at the REAL potential for rent and run my numbers based off of that - of course not a lot of properties will show a good cap rate when you do this - but I feel that it is more realistic and I don't have BS anyone when it comes to what a property can generate - I don't have to go back and adjust numbers for things that weren't taken into account initially - keep in mind that most real estate agent don't even own any property much less investment property - try to work with someone who has their own investments and understands the intricacies of income property. As someone posted - the actual priced based on a 6% cap rate will be much less that what is currently on the market - these sellers are seeing SFR prices going through the roof and somehow thinking that it applies to Multifamiles - but a MFR is only going to be worth what you can get out of it and investors are too savvy to pay what they are asking which is why so many of them are just sitting on the market right now and agents are blowing smoke up about their cap rates

Hi Isaac - welcome to the forum. There are many opportunities in real estate and I think it's great that you have decided to put your hat in the ring.  If you would like to meet other investors and network then it is a good idea to start attending local investor meetup groups. You can learn a lot from other experienced investors as well as start to build your buyers lists and  connect with wholesalers, lenders, and contractors - all connection that will be valuable to you when investing in real estate. I've been running a local meetup for the last 3 years, but there are also a few others right here in Fresno that have some great people to connect with. If you have time - maybe we could get together over a cup of coffee the next time that I am in the LA area and talk  about what it's going to take to get you kicked off with real estate investing.  I also have some resources for you to take  a look at if you are deciding to get your license. Feel free to reach out to me - have a happy Thanksgiving!

Hi Bruce - there are a few excellent real estate investors meetup groups right here in Fresno  - if you check out meetup.com you find them easily. Also feel free to PM me and I'll be happy to direct to the one I attend every other week - in fact - there is one happening this week on thursday. 

Hi Joseph - you'll be happy to know that there are a few real estate meetup groups that are already well established here in Fresno - I can't give too many details without them flagging this post - but I will say this - that if you look up REIA meetup groups for Fresno - you will definitely find AT LEAST TWO major groups that meet regularly. I would encourage you to take a look at them and them attend one when you get a chance - there is a meetup happening next Thursday and the subject is "6 Things You Need to Know About Every Deal You Look At" Hope that's helpful - also feel free to reach out to me for anything relating to investing in real estate - I've been investing in Fresno since 2000 and I have built up a network of buyers and sellers - let me know if you'd like to get together for coffee or something. - I'd love to hear more about how you're building your business and who I can connect you to so you can keep growing.

Hi Leah - congrats on choosing to invest in real estate - buying your first investment property is a big step and can be exciting and overwhelming at the same time. I did something similar with my first investment property also - I lived in one side and rented out the other. If you purchase with an FHA loan - then you will be required to live in the property for at least one year before moving out. In most cases, if you buy with a conventional loan then you do not need to live in the property and are free to rent it out immediately, however , if you qualified for the loan with the subject property being a primary residence on your loan application than you must occupy the property for at least one year. Your best bet is to sit down with a loan officer and discuss your plans - they will be able to tell exactly what you can and cannot do - you may also want to consider getting prequalified so you know how much you can buy and what your payments would be - this is especially useful in running your numbers to see if a property will cash flow or not. I'm happy to help connect you to a great lender that I have used for over 17 years right here Fresno if you'd like.