All Forum Posts by: Gary F.

I've been talking with a couple of RE agents about possibly purchasing in South Lake Tahoe. The prices are around $350 for a 3-4 bed/2baths SFR. These homes are within 4 miles of the main strip and casinos. There's also Heavenly Ski resort. Rents are about $2k

I can go either with vacation rentals or long-term tenants.  Being more of a resort community, there's really no bad areas to purchase, value being based more on distance from ski lifts and shopping. Rents of course are higher closer to those areas for convenience and the work force. 

Anyone with experience in Tahoe?

RVs? As in Recreational Vehicle? Or do you mean mobile homes in a trailer park?  This sounds good.

Great advice here.  If a bank does not/cannot disclose full information about the tenants, yet makes certain unsupported claims, that sounds very fishy to me. Like everyone else said, get full disclosure in writing. Else if a tenant says, he is owned XXX$$$ upon moving, you're out XXX$$$. 

@allenfletcher

It's been on the market about a week, per the RE agent.

@michellefischer

I'd check it in person before buying of course. Stay overnight nearby and do a night visit..If i dare. LOL. The listing agent has also been the PM for the current owner/investor. He says he charges 6% of gross monthly rent. Not too bad I suppose.

So far, if the rental numbers verify true, this may be a good investment.  Assuming $250 purchase price: 

25% down at 4% = $560 (mortgage, tax, insurance). 

75% loan @3.25% = $1100 (mortgage, tax, ins). 

Total monthly expenses (minus vacancy rate, expenses) = $1660. 

Again, all this assumes rent is correct.

My goal is for positive cash flow, like everyone else I suppose.

Yeah, the ghetto is not my ideal choice, especially for my 1st investment.

I see what you're all saying about 25% down and spread the HELOC money out on other properties. I'm just wondering how I would qualify for the 75% loan balance on the other properties. I suck at math so I'm missing something that you all are onto and "In the know." I know what helps is that on the other mortgages I could get a lower rate than my current HELOC at 4%.

Derek. You're on it. That is the property you're thinking of.  It seem decent on paper, but yeah,the neighborhood on a Google street view is not stellar.  And of course, those rents need to be verified with a paper trail history. 

Hi San Jose BPers

My name is Gary. I've recently joined BP and I live in San Jose. I hope to get know you all and look forward to meeting up.

I'm hoping to start in REI by purchasing a duplex soon. I can't make the 17th meeting but please add me to the list for future meetings. Thanks

I'll be the first to admit, I'm a total newbie at REI. I've been trying to educate myself as much as possible reading the many posts here on BP.

My situation:

I have a plenty of equity on my current home. I currently have a $250k HELOC at 4% fixed/5 yrs.

Potential property:

Asking price $250

Sacramento, CA. Low income area

Duplex, 7200sf lot. Two freestanding small houses on one long parcel.

Claimed rental history ~$2000/month:

Unit 1: $1300. 

4/2. 1300sf. Carport. Hardwood floors. W/D in unit.

Unit 2: $700

2/1. Carport

The selling agent says both units are currently rented with non-Section 8 but they have done Section 8 in the past. One long term renter (5 yrs) and one moving on next week.

He says current owner is an older investor. Online research shows the current owner may have paid approx. $120k for the property back in 2011. He would do quite well if he gets his $250k asking price. CA is hot right now, so they could potentially get more than asking also giving this property's unique 2 separate houses setup vs. a shared wall. Of course, I've no idea if we're in a bubble and the market will go down in the coming months/years. On the downside, it's in Sacramento in a less than stellar neighborhood. Almost a "ghetto" maybe.

I could potentially pay full cash asking price if property was really worth the price.  But even the selling agent advised against that stating it's better to put down 25% and mortgage the balance. I'm still not fully understanding the advantage of that since I'd still have to pay that loan as well.

Please share thoughts....Thanks.

Good information to know.  Accept only full payments.  It seems once behind, the excuses start coming in and the balance due simply grows.  I guess its a dance once a bad tenant is in there to keep from having to go down the costly road called Court. 

 Hi, Kevin.

Hmm, good point. Not a good idea on appreciation that might not happen.  If only we could have a crystal ball. 

 HI, Abhay.

Yes, great wisdom yet again. I have no idea of the market's future of course. So I guess it's better to go in assuming it will go down and have those exit strategies. 

Selling my home in this nice suburb with my comfortable low payment and low taxes is not my first preference. Especially if my equity drops (If I were in a duplex) and I'm sleeping next door to some stranger, who also may turn out to be Dr. Jeckyll for all I know.