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All Forum Posts by: Gabe C.

Gabe C. has started 14 posts and replied 191 times.

Post: To LLC or to Not LLC

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

@Tyler Jahnke Np. I had these questions recently too. I went a year without, and then when I started getting worried about building up too much equity without protection, I called. It's worth noting that a good lawyer is still probably not going to say "You should definitely do this." They will just paint a grim picture of risks and let you decide. You'll need to figure out how much you could stand to lose in a court battle and compartmentalize your assets accordingly. It is also in their best interest that you pay them to set one up, so keep that in mind. They make nothing if you decide to stick with the umbrella policy exclusively, but for many people, this is just fine, and you'll probably want that in addition to any LLC for max protection anyway. If you're just getting started, an LLC is not a prerequisite and probably falls in the "too much overhead category". Although, if you have a primary home or a lot of cash in the bank, you probably want to protect those by keeping your investments separate. This is just my experience though, I'm no lawyer. Find a good one!

Side note: LLCs in CA are really expensive.

Post: To LLC or to Not LLC

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

The best answer is to talk to a lawyer that specializes in asset protection. They will assess your situation to see how exposed you are. If you don't have many assets with a lot of equity, you're probably fine with an umbrella insurance policy, but it also depends on what sort of investing you're doing and how litigious the clientele might be. It all comes down to how much risk you want to take vs. how much overhead you want to deal with. I think when you have a lot to lose, this answer suddenly becomes clear. :)

Post: What new tech would be most helpful to you?

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

Doing a actual walkthrough using info from a camera is many years away, and not even what I think would be the ultimate desired effect. In the short term, walking makes people vomit due to inner ear issues that nobody has resolved yet. Some have used "tunneling" which takes away your periphery and makes it more like a TV, to reduce the nausea. That could help here maybe. Teleporting from room to room and standing to look around is feasible with current tech, but those headsets are still $500-$800 and the cameras range from $200 - $60k. The average person won't have that lying around just to do walkthroughs. Not to mention you either need a $1000+ PC or a PS4 which brings the cost up even more. Google just announced Daydream, which is a headset you just drop your phone into. That's sub-$100. You still need to get their Pixel phone, which is $650. They have Google Cardboard, which works with just about any phone, but the quality is so bad, you wouldn't have a meaningful experience. In a few iterations (years), we'll likely have cheap cameras to generate the data and google glass like headsets on the cheap, or the ability to use just about any phone to view. That will be nice... but VR data generated from a camera still has other limitations, like the ability to look behind objects and outcroppings, since the cameras are stationary. You would definitely want to do that in a walkthrough.

I think tech like whatever the next iteration of Photosynth or 123D is, or other photos -> 3D apps, would solve that problem. You basically take photos of objects (or rooms) from many angles, and it automagically figures out how to construct those into a 3D space. You can fill in details by just taking more photos. Currently, it's a very manual process and doesn't do big spaces yet (that I know of), but if they get a camera that does something similar to the Google Maps shots then a realtor would walk through a house generating a bazillion pictures and munge it into a 3D house that a person could walk around in using a mouse/keyboard and controller.  You could also save that to the web so anyone could do it in a browser on Redfin or whatever. You could also use that data in VR to walk around and experience at human scale, and allow you to look anywhere you wanted. Now we're talking! Because...

Since it's a 3D model, you could also enhance it. Someone could open it in 3D software and tag things with metadata from the MLS, so as you walk around you could interact to see "Roof, replaced in 2013" "Water Heater, brand new", "Living Room, 14x16" etc as you look around at objects. You could add an interactive overlay with school information or cap rates or whatever. You could stage it with stock 3D furniture or pictures on the wall, and allow the user to toggle "furnished" on and off. Maybe allow the user to change paint colors, or if it's easy enough to separate the appliances or cabinets, maybe they could swap those out to see what it would look like with stainless vs. white appliances. You could change the lighting. The options would be endless if it were a 3D model. All of this assumes streamlined software and iterated hardware to reduce the creation time, but this future is not far off.

You could do some of the tagging stuff with AR, right now if you are walking through the actual house. Just seeing overlays of metadata on the actual objects. You might have to tape up QR codes or something, but that could be a nice gimmick.

Post: Website, Real Estate Agent, Or...?

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

@Lauren Stamey MLS alerts don't cost anything, and it's a one time setup unless you keep asking them to change criteria. Just make sure you narrow it down before you ask, to minimize that. They make their money on the sale.

Post: Website, Real Estate Agent, Or...?

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

@Lauren Stamey Once you figure out your criteria, hook up with an investor friendly agent and have them set up MLS alerts for you. Then you'll have them as they come on the market. The data on Zillow/Trulia/Redfin is pretty reliable. I prefer the latter most of the time. You'll also want to get on the Wakegov.com/realestate site for latest gov't related info (taxes, owner info, etc).

Post: What cash flow returns does you guys look for?

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

In Raleigh, I don't look at anything less than $200 for THs. For SFHs, I've seen deals on the MLS in the $500 range, but they are rare.

Post: New discouraged investor in Sacramento

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

@Wesley Duvall I'm in the same boat... in my 40s trying to replace my income for retirement. You sound like someone that might have a (401k/IRA)? That can give you a few more options to help. You could roll it to a self-directed IRA and invest in real estate that way, or maybe do a 72t distribution and have it supplement your mortgage payments to help you accelerate the equity building. That also helps your DTI to get more financing, and you can later refi/HELOC to get at the equity.

I invest out of state and love it, so that would be my endorsement. $40k would still get a newer construction SFH (little to no CapEx for a bit), cashflowing place in a B neighborhood in Raleigh, NC, for instance. Vacancy rates are practically nil. It's nowhere near 2%, but I'm appreciating and cash flowing well.

Good luck!

Post: New Kid on the Block

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

Welcome, @Steven Singleton ! I live in SF and invest in Raleigh (I'm from there). It has been very good to me so far. Feel free to PM if you want to discuss anything. 

Post: Rentals

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

woah. I knew HOAs were getting bad, but $1,111,111/mo?!

Post: Self directed ira

Gabe C.Posted
  • Investor
  • San Francisco, CA
  • Posts 192
  • Votes 95

I'm using Kingdom Trust. It hasn't been that long, but they have been great so far, and their customer service is super friendly.