All Forum Posts by: Grant Perkins

Both can be a good investment and I personally invest in both but my portfolio is more real estate heavy. Real estate tends to be a longer term investment although there are methods to both asset classes that can be long or short and can be more active or more passive. The thing about real estate that makes it my preference is that it can be highly leveraged allowing you to use mostly other peoples money to purchase a high priced asset and then your tenant pays back the other people over time for you. This tends to be a little more of an active investment than just purchasing a stock. It all really is determined by your individual goals and skills/knowledge.

Hi Shane,

Like Melissa said the lender just needs to be licensed in the state where the property is located(many lenders are licensed in several states) and with most lenders nowadays both inside and outside of your home state you would probably never meet them in person anyway. Most interactions are over the phone and documents are submitted through a dashboard. Out of state will likely cash flow more and be more accessible for entry compared to CA (lower purchase prices). There are a lot of different loan products too, so do some research and probably talk to multiple lenders.

Hey Ben,

I would agree with Matt to a degree that regulations in the Tahoe area have changed and STRs are more difficult but not impossible. In the city of South Lake Tahoe they are outlawed except for in the tourist corridor. Outside the city in the county areas of South Lake Tahoe permits are limited and there is a wait list. Also other regulations like STRs can't be within 500 feet of each other. If you are able to get a permit you can make it work but you may want to find a property that could work STR, MTR, and long term as a back up. It's always nice to have multiple income strategies in case something goes wrong such as a regulation changes or you don't get a permit.

I also am a big fan of small multi families. Less risk with vacancy, one units vacant the other is hopefully still covering your mortgage. Your other idea of a house hack is good too and could allow you to increase your available cash for other investments, and decrease the cost of your own housing. Not sure it is feasible with how expensive the Bay Area is. Best to start running the numbers on properties in these markets and see what works best for your specific goals.

Why I believe in real estate investing: When executed correctly, it is one of the most effective long-term strategies for accumulating wealth. By employing leverage, you have others paying your debt down and increasing your equity.

All the other benefits that come with it are simply the cherry on top, including appreciation, regular cash flow, and the perks of tax benefits related to investment properties.

Furthermore, it's a surprisingly creative career path. Real estate investing compels you to find inventive solutions when confronted with challenges. For instance, when conventional financing fell through due to a vacant rental property and insufficient time for rehab before closing, it spurred the search for an alternative. Numerous options were considered, but ultimately, a DSCR (Debt Service Coverage Ratio) loan was secured. While it came with a slightly higher interest rate, it still resulted in a positive cash flow.

There are also so many different strategies to choose from that are so interesting and lend to the creative nature of the field.