All Forum Posts by: Wai Chan

@Mia Trasolini
I would invest in the "sketchy" area that people usually refer in San Diego. In fact, if you really have spent some time in those neighborhood, they are just another normal working class neighborhood. Of course Logan Heights is not University Heights and City Heights is not Clairemont/Linda Vista but those "sketch" area can produce positive cashflow!! If you would want to argue that the "nice" area can appreciate much faster, I don't agree. Percentage-wise those "sketchy" area appreciate faster. 

I saw a 2 units + a non-comforming studio in Logan Heights last week listed at 475K. Section 8 tenants but have potential with the CC-3-6 zoning. Rent is good and can definitely cash flow US500+ each month. If I am not under contract on another property, I think I would get this one. Agent has listed it as SFR which I think a lot of people have missed this deal by mistake....

I own 8 SFR in DFW area and have landlord liability insurance (USLI) for all properties for 1M per occurrence. For the 3 triplex I own in San Diego, I only have regular home insurance. Should I purchase additional umbrella policy on top of all these home insurance I have purchased? Any recommendation on insurance company that can run some analysis for me? Thanks.

@Brian Schmelzlen
Thanks for the response. I will definitely wait for the announcement from IRS end of this month.

@Michael Plaks
I have a full time W2 job which has nothing to do with real estate but I also own and manage >15 units across several properties. (All under my name except one is under both me and my wife name) That's why I think I may qualify....I hope IRS can give out guideline so that there is no ambiguity.

I am looking for recommendation for home inspection for a triplex in San Diego. I want to find an experienced home inspector that can look at everything for an aged property. Could you give me some suggestions? Thanks.

@Michael Plaks
Thanks for the response. I think I do qualify for the two points that you mentioned :)

If me and wife own a piece of rental property (joint tenants and not under any LLC), does it consider as pass through entity? When we file tax jointly next year, can we claim the 20% pass through deduction for the rental income. I am not sure the definition of partnership mentioned as below. Is joint tenants a type of partnership?

This is a snippet of the article I read online:
>>For landlords, the most stunningly good provision of the TCJA is a new tax deduction for owners of pass-through businesses. This includes the vast majority of residential landlords who own their rental property as sole proprietors (who individually own their properties), limited liability companies (LLCs), and partnerships. With these entities, any profit earned from the rental activity is “passed through” to the owner or owners’ individual tax returns and they pay tax on it at their individual income tax rates.

Thanks.

@Account Closed 
Thank you for the response. Amount Y is for different purpose which has nothing to do with amount X. 
If I could get the borrower to sign another promissory note for amount Y, how should I structure it so that I could get both money X+Y on the payoff demand?

Hi, I am holding a CA deed of trust against a property with X amount dollars on it. However, I am also holding another promissory notes with Y amounts dollars from the same person which is already past due (no deed of trust). Upon the sale of the property thatI hold the deed of trust, can I request a total of X+Y amounts of dollars on the payoff demand statement from escrow? or am I only allowed to get X amounts of money which is shown on the deed of trust?

Another question is:

Do I need to have the original copy of the deed of trust and the original copies of the notes to get back the money? I have photocopies of the notes with both parties signatures which are notarized. I also have the photocopies of the deed of trust that is recorded with the county.

Thanks.

Hi, So let say I have a piece of land 4500 sq ft and the zoning is 2000 sq/ft per dewelling unit. Am I allowed to build 2 units or 3 units in this case? Do I round up or round down for the number of unit I can build? Thank you.

I have invested in both Dallas and San Diego but I am now looking for area with better return. I have just started studying the South Chicago multifamily apartment market. I have looked at a few deal (6 units+) around U. of Chicago (zip code: 60649, 60637). It seems that almost all deal can achieve 10% cap rate with 20%+ cash on cash return. The number on paper looks pretty good. However, I am not sure the turn over rate and rental demand on these area. I have just read the report from Freddie Mac and it seems that the vacancy is pretty low and the rent increase is decent (http://www.freddiemac.com/multifamily/pdf/mf_2017_...)

Also looks like rent in South Chicago is pretty low. I see the average rent/sq ft runs about US 0.5/0.6. You pay only about US1100/month for a 2000 sq ft 3 bedroom 2 bathroom apartment or US650 for a 2 bedroom/1 bathroom. That sounds extremely affordable taken into account that minimum wage will increase to US13/hour in 2019. Looks like to me risk is low for rental.

A few questions I have in mind:

1. I have heard a lot of bad stories about South Chicago so I want to make sure I am picking the right zip code.  Could you share some area which I should look at? Good cap rate but also a small appreciation over years? I am not looking at the best cap rate as I don't want to deal with very bad neighborhood.

2. What size of apartment is the easiest to rent out? 2 bedroom/1bathroom?  

3. How do I calculate the property tax in Chicago? Is there way I can find the tax rate for different zip code?

4. What would be other big expense beside property tax? Is insurance expensive in Chicago?

5. Anything I need to be careful or take into account of when investing MF in South Chicago?

Thanks in advanced.