All Forum Posts by: Lance Johnson

@Satha Palani the amount of room you have to negotiate on the price now will depend on the particulars of the contract. Hopefully, at the very least, you have the opportunity to cancel the contract, and as long as you have that power, you always have some room to negotiate the price. Whatever happens, never go through with a deal that doesn't make sense if you have the option to put on the brakes.

Thanks for the warm welcome, all!

@Mark Pedroza - at the moment I'm not actively looking to sell the SF property. The biggest issue with it is that it is a condo, and the HOA dues put a big hit on the cash flow.

@Rob Scarborough - I'm definitely interested in exploring other opportunities in the Kansas City area. Right now the property I have is in the Brookside area. I am open to that area, or others, though I have been to Kansas City frequently enough to know that there are some areas I want to avoid.

Thanks, @Devan M. it is great to be here on the site.

Always make sure to do your math on a deal! There are many rules of thumb that you can use when you start to look at deals, but nothing will beat analysis of actual data that applies to your specific circumstances.

I was recently negotiating a deal for four duplexes. The pro formas looked good, the rents looked good, the purchase price seemed fair... By all the rules of thumb, it was a good deal. But once we put everything into our financial models and actually looked at the cash flows and ROI, we killed the deal because it was clear that we couldn't what we needed.

Zillow and Trulia can provide some good metrics, as well.

For rental vs. owner-occupied rates, I'm not familiar with any systems that can give you that data with a high degree of accuracy; however, you might be able to get a pretty good idea by looking at zoning maps for areas you are interested in. Areas that are zoned for multifamily are much more likely to be a high percentage of rentals than area that are predominantly SFH. Of course, SFH could also be tenant-occupied, so it is just a proxy.

The answer to this depend mainly on what other assets you have. If you have significant assets to protect aside from the property, it might be worth it. If your rental property is your main asset, it might not be worth the added expense that is imposed, particular in California.

The main pro, of course, is that you are afforded certain legal protections and (potentially) favorable tax treatment with an LLC. The main drawbacks are compliance requirements, franchise / business taxes, and potentially higher costs to finance/insure properties.

@Jason Diaz - welcome! RE is addictive. I ended up with my first rental property after I moved out of a place I originally bought as a primary residence. Once I got a taste for it, though, I was hooked, and I bought a second property last year as a rental.

Good luck to you!

I recently joined BP at the suggestion of a friend who has been following the forums and podcasts for some time. I currently hold two rental properties - one in San Francisco, and one in Kansas City, MO. I ended up with an investment in Kansas City primarily because of some social contacts I have there and the more favorable pricing available there vs. the Bay Area. 

I have owned my San Francisco property for about 7 years. I purchased it as my primary residence, but after 6 years, I moved out and kept it as a rental. Despite the high costs of doing business in SF, it is cash flowing. I was looking for another investment in late 2013, and ended up with a SFH in Kansas City, MO, which is also cash flowing - much better than the San Francisco property, both in nominal and real terms.

I'm primarily interested in Buy & Hold (or Rehab & Hold) for long-term wealth building and passive income; however, I am also very entrepreneurial, so I am always looking for the best strategy for current market conditions.

By day, I run a web design and development company here in San Francisco, and at the moment my goal is not to quit my day job any time soon.

I'm looking forward to getting more involved here at BP and getting to know everyone.

Lance

I agree with @Jake Jefferies - different tools for different questions

I have certainly used my phone to integrate with some of my tools, such as account systems, etc. What particular things are you trying to accomplish with your device?