All Forum Posts by: Gaurav S.

I am also looking into buying a HUD home. Does the normal bank financing also based on a "move-in" condition of the home.

If I plan to buy a foreclosure home with HUD or auction do I need a special lender ? Do I need to tell the lender about the type of home I am planning to purchase during prequalification ?

Thanks.

I have absolutely no intention of loosing money (does anyone :roll: )

So it would serve my best interests to go into this with open eye and rational mind. I have made a small excel sheet that I can use to evaluate a property. The variables that go in it are loan related terms,inflation,rent, commission on sale, repair expense. Will improve on it as time goes by.

To look for properties where I have relatives/friends is a very good suggestion. I will start asking around.

"As far finding properties in CA, I would get involved with other RE investors and network. Try to find those wholesalers or bird dogs that have properties lined up that aren't listed on the MLS. I think you'll have a tougher time finding the "value" deals on the MLS."

What is the best place to find a bird-dog ?

Regarding the tax benefit my understanding is that you can depreciate the cost of the home minus the land every year to reduce your tax basis and hence save on tax. But when you sell the home the tax you owe is calculated using the lower depreciated price of the property and hence you might owe more tax at that time. Is this explanation correct ?

Thank you everyone for all the great advice. I agree about subtracting insurance + property tax + maintenance but 50% rule seems to be crude. It will vary with age of property, the type of tenants,etc. etc.

I will start looking at MLS listed income properties in Oxnard/Ventura area and see if the ROI from rent would be worth the asking price.My hunch right now is that it won't.

If not, then either I have to buy a fixer upper or start looking all over US. Doing a fixer upper as my first purchase seems daunting but finding a property anywhere else in US seems even more daunting.

Has anyone bought their first property outside of driving distance ? How did that work out ?

Also how do I go about setting up my finances. Should I purchase this property through a LLC in which I am a investor/partner.

In the worst case scenario i.e. if I can't find tenants and property is worth less than what I owe on it.........what happens ? Can the bank come after my assets if I directly but it...or is it like a owner occupied home where you handover the keys and walk away.

What if I am staying in one of the units ? Do the rules change in that case.

How do you guys do it ?

Thank you everyone. All good advice.

Its a no brainer to buy a property in texas compared to California. But since I have never been to Texas wouldn't it be difficult to get my arms around doing this. Even if I use a property management company how do I select where to buy ? How do I know if I buy a particular property the renters will come or if its a good deal or not ?

I think I will first try to buy something in Oxnard. Atleast in worst case I can call it my home even though its not profitable.

Can anyone recommend a real estate agent or someone who knows more about Oxnard area.

I am willing to invest around 120k in this. Every bit of that is hard earned money so I hope you understand my uneasiness in putting this money at risk. That is why I would like someone to refer an experienced trustworthy person who can help me at this.

Thanks,
Gaurav

Thanks for the reply.

Yes I was also thinking about 4plex but if too expensive I might also get a 2plex with I living in one of the 2.

Since I am a newbie how do I go ahead ? My intuition tells me to look online on mls or HUD+fanniemae foreclosures for owner occupied units.

HUD+Fanniemae have special 15 day period in which only owner occupied people can bid on the properties.

But my problem is I am not too familiar with the area as well as what to look for when buying a rental property. I am sure I will learn along the way but it would be nice to have someone trustworthy and experienced to hand hold me through my first transaction at the beginning.

Regarding retirement account I do not feel comfortable putting all eggs in one basket for now. Maybe in future.

Can someone recommend a real estate agent or a person who can help me finding a property that might be a good deal.

Or buying in Ventura County just doesn't make sense and I should just broaden my horizon to anywhere in US.

I was thinking if I buy in Ventura County I already have a tenant i.e. myself :)

I got introduced to BP yesterday and tried to read as much as I can but did not find some specific details for a beginner. I guess it depends what your goals are. So here are my details

I am 30 years old married with no kids. I work full time as an engineer and love my job.

Investing in stock market is my passion and I have done quite well. I am follower of Benjamin Graham/ Warren Buffett style value investing. Its getting hard to find value stocks nowadays in the market and hence I am thinking about buying real estate property.

I have around 150k in non-retirement account but I am not sure how much of that I will be willing to put into the RE investment.
Also I currently rent an apartment. So I was thinking of buying a multi-family unit and rent one unit for myself. This way I might be able to skip the property management costs.

Any property that gives 10% yield unlevered per annum including the cost I have incurred if I was renting would be a good deal in my opinion.

I have a 780+ credit score and should not have problem getting a loan.

So my question is how do I start ? I would like to buy the property in Ventura/Camarillo/Thousand Oaks area since I work in Santa Barbara. Is there a bird-dog I can hire to find such property for me ? What are the sequence of things I should be doing from today onwards to make this happen.

Thanks for your time
Gaurav