All Forum Posts by: Howard Chen

https://youtu.be/MqvVeYTIo1o?si=VZFyPbSb_Xogld5t

I hope there aren’t too many people who fell victim to their scheme here on BP.

The following info cited from Rentspree, is more or less the guideline I remember

“Under the provisions of the Tenant Protection Act (TPA), landlords are allowed to increase rents each year by 5% plus the applicable average increase in the cost of living in order to allow for inflation. There is a maximum increase of 10% allowed in any given year, thus the Act’s provision is often referred to as a “rent cap.”

To calculate the cost of living increase that is applicable to your market, use the Consumer Price Index (CPI) published by the Bureau of Labor Statistics. According to AB 1482, landlords are required to use the CPI from the previous April for their specific market area to calculate the allowable rent increase.

Properties that are exempt from rent control

In general, California rent increase law is aimed at multi-family apartment complexes and provides a number of exemptions, including the following:

• SFRs (single family residences)
• Condominiums
• Owner-occupied duplexes
• Mobile homes
• School, college, and university -dormitories
• Hotels
• Rental properties built within 15 years prior to the Act, including ADUs (accessory dwelling units)
• Properties that are not owned by a corporation, REIT (real estate investment trust) or LLC where one member is a corporation
• Property provided by non-profit organizations
• Property that is subject to pre-existing local ordinances

Landlords for exempt properties must provide a notice of exemption from AB 1482 to their tenants. If you believe that your property is exempt, check with your real estate attorney to draft a notice of exemption or consult with a professional organization like California Apartment Association or California Association of Realtors for up-to-date forms and information.

Providing tenants with a rent increase notice

It is important to be clear and timely in communicating with your tenants if you decide to increase your rent. Check with your attorney to see if there is specific information you should include in your market and to determine what the timeline is for notification. In general, a California rent increase notice will include the following information:

• Names of each tenant
• Property address
• Your name and contact information
• The date of the rent increase notification
• Rental amount for the previous tenancy
• New rental amount per month
• Effective date of the rent increase
• Section of the lease agreement relating to rent amount
• Requirement for non-renewal notification
• Section of the lease agreement relating to non-renewal notification”

I hope this helps.

Thank you and likewise @David Korchak 

Same here, it all comes down to the appraisal. If the #s work, I'm definitely going the BRRRR route!

@Zach Lemaster Sounds like a plan! Thank you for providing your services/resources at RtR, as an option for investors. 

Congratulations on your success David! I moved much slower than yourself and didn’t have much progression since my initial house hack deal closed at the end of 2019. I decided to upgrade to Pro at the end of 2020.

2 months prior to my one year anniversary as a BP Pro member, I rebooted the house hack model, after a minor stumble at the beginning of 2020. So far I've been able to keep at least one of my two rooms consistently occupied. I did a refi on my primary at near ATL rates in Aug. 2021. Which resulted in a nice reduction in P&I along with the elimination of PMI.

Fast forward to 2022, I was able to partner with a local agent on the David Greene Team(shout out to Haley Dahlgard!) via the BP Agent Finder tool(thank you BP for creating this tool), and am in the beginning stages of my first fix and flip! 

I remember having early conversations with @Zach Lemaster , and having plans of investing through RtR(Don’t write me off yet Zach, I may still do a deal with you in the future!) as with many things in life, the universe had a different plan and steered me in a different direction. 

I can't thank BP enough for the wealth of knowledge, the tools, and the network of helpful professionals in this community. I owe most, if not all my progression in REI, to BP. For that, I am eternally grateful, and look forward to giving back to the community in whichever capacity.

P.S. I hope I can complete the fixer in time for BP Con 2022 in San Diego. I’d love to meet some of the members of the community in-person! 
 

I’m reaching out to the BP community to see if anyone knows a great GC in the Sacramento area they can refer me to?

I’m Scheduled to close on a property that needs a full gut reno in the next week to two, and would like to start the work ASAP once closed. 

Feel free to PM me directly for contact info. 

Thanks in advance! 

@Pratap Singh to add to what @Brenden Mitchum mentioned.

IMO, if you’re planning on keeping the property long term, I’d opt for option 2, since it’s lower interest rate(keep in mind, we’re also at historical low rates) and higher cashflow. 

If $7k makes all the difference in accelerating you to acquire another property in your market within the next 12 months or less, you’re still cash flowing at the higher interest rate, and the property is in a steady appreciating market, then I’d choose option 1 

@Lauren Zuend

Congrats on having such a great mindset at an early age Lauren!

Many great tips from the BP community. One thing I want to add, is to look into local/state/federal gov programs or non-profit orgs for down-payment/closing cost assistance, for first time home buyers. Look into  combo’ing some of the grants/programs together. Some of the grants/programs also apply to the purchase of multi-families up to 4 units.

I bought my first house hack with a $20k grant and 3.5% out of pocket. I rent to two traveling professionals, and have managed to carve out a positive cashflow. I feel fortunate, considering it was a brand new build, in a major suburb, in California.

Feel free to check out my profile for details on my house hack.

Happy investing and best wishes to your REI endeavor!

@Kaylee Walterbach

After purchasing my primary residence at the end of 2019, and having a temporary set back with a long term tenant that didn’t work out after 3 short months in 2020, I’ve successfully leased both rooms to medium term tenants within one month of listing in Q4 2021. It feels great to “live for free” and I am excited about what the future holds in life and RE endeavors!

Cheers to everyones success, learn from everyones failures, and happy investing!

Investment Info:

Single-family residence buy & hold investment in Sacramento.

Purchase price: $417,092
Cash invested: $14,600

Oct. 2021 Update #2: A tenant has been secured for room 2. Since the majority of travel nurses are females, I realized they would not feel safe/confident in booking from, who they presume, is a single male, so I included a profile picture of my gf and I. Second, when signing off on my marketing outreach messages, I include my gf’s name along with mine. Please see the investments section of my profile for more in-depth perspective along with details of the updates.