All Forum Posts by: Hau N.

@Hardik Patel the quadplex we currently live in was listed on the MLS for $475,000. It was a REO property under a first time home buyer program, so for the first 12 days only non-investors, people who would live on the property could bid on it.

Listing Price: $475,000
Offer Price: $480,000 [offer sent on 6/22/15]
Purchase Price: $430,000[closed on 10/7/15]
Down Payment: $43,000 [10% down, No PMI]
Closing Costs: $9,842
Mortgage Loan Amount: $387,000
Interest Rate: 3.99%

The second property was a for sale by owner we just found off Craigslist. 

@Wilson Cheung I am a buy and hold investor in the SF Bay area.  In less then 5 years I have been able to put together a portfolio of nearly 20 doors and the fact that this topic comes up so often is just mind boggling to me.  As an investor the discussion should not be about cash flow OR appreciation.  I personally believe investors should look for properties that provide BOTH.  The basic equation that I follow is: cash flow + appreciation = financial freedom.  To all of the people who believe that there are "no cash flowing deals" in the Bay Area, based on my short personal experience, I say they are wrong.  I can say that, because all of my units cash flow AND I have had incredible appreciation during my holding period.

Is there going to be a correction in the near future?  Probably...  But if I have done my research properly, my units should continue to cash flow and also retain a NET appreciation value during a market down cycle.

Don't settle for 1/2 of the financial freedom calculation, look for both. It takes hard work, planning and diligence, but the deals can be found.   The real question is how do you get both in any market.  A strategy must be devised for each particular market and even down to the individual property. 

Good hunting to you!

-Arlen

Heck.. even 30 yr treasury bonds would be better. $60,000 @ 2.85% makes you $142.50 tax free a month on average and would be the definition of passive. Not that that I would choose a treasury bond over a low risk mutual fund that could easily net 6-8% a year. 

Just showing you, that in a click of a few buttons you could have that bond purchased and never look at it ever again. 

Or you can manage a property, deal with all the headaches it comes with it for potentially +-$35 in monthly cashflow.

Doesn't seem worth it. 

GL! 

Yeah listen to these guys.I didnt have the benefit of this site going into my first two deals. Almost 0 cash flow, now banking on increasing rents and appreciation. 

 If you "wait for another deal to come by" you will likely be waiting for a long, long time. Deals don't generally just fall from the heavens and land squarely into your lap. You usually have to pound the pavement to find them and/or better yet, create them ... and yes, this takes work, especially in the beginning before you have your systems, skills, knowledge, network, and techniques in place, but I know of no other reliable short cut to get them in place other than rolling up your sleeves and getting to work. Good luck to you!