All Forum Posts by: Jacob Prelle

Thanks for taking the time to respond thoroughly. We were basing the better deal assumption on articles of where the best places to invest in rental properties are, and the only CA locations recommended are either out of our budget or so far away that they might as well be out of state. Much of our reading has suggested that out of state buyers of distressed properties may get gouged by contractors and property managers if they are beginners. We both have full time jobs that we plan on keeping, which would make learning the hands on part of it difficult. Buying a turnkey would help ensure we know what we are getting. If the Cap Rate is better on a turnkey out of state than on a local property, is it still a poor investment in your opinion? What if the higher costs locally cause a significant delay in our ability to buy anything? Eventually, we would want to learn the business hands on locally when we can devote more time and money to it.

Obviously we are very much beginners and are still in the early stages of research. Any information and opinions are appreciated!

Thanks for your response! State LLC laws will be added to the research list.

Hi All, 

I'd love some help answering two questions:

1. Is it wise to open an LLC for every property purchased?

2. We have no experience being landlords or owners. If able, we'd like to purchase rental properties out of state to obtain better deals. So far, research has indicated that turn-key properties that already have management in place are best for beginners. Where should we focus our learning and research to best prepare for being beginner out of state owners?

Thanks,

Jacob and Rachel

Thank you both for your response. Ky, is it possible to go FHA on a duplex in San Clemente with 3.5% down and rent one unit and my wife and i live in the other?

I know there is a limit to price and it's around 800K. Are there other limitations? 

My wife and I are learning a lot about investment properties and are planning on purchasing our first this year. We are currently renting, have about 60K in the bank, and we both want to retire in about 10 years. She owns her own business and makes around 35K. I'm currently unemployed (I work around the country on contracted jobs) but when I am employed, I bring in around 100K a year. We have no debts and excellent FICO scores.

We live in Orange County, California and can't buy in-state.

I'm worried that we're going to have trouble qualifying for a loan. We're not hoping to house-hack, or BRRR. What we feel comfortable with is purchasing a couple of properties each year pricing around 200K-300K. That would (hopefully) give us a positive cash-flow and when paid off, we can enjoy the benefits of not having a mortgage.

Does anyone think we will have an issue qualifying for a loan if I have gaps in my work history? From 2012 to 2016 I've had no gaps, but in my new position, I'll likely have 3-6 months of gaps on average between projects.

Thank you for the advice.