All Forum Posts by: Jay Y.

orchid Thai it is!

@Pete Tam

I meant me + 1... but actually, it may be me + 2 if that's ok.

+1

sounds good.

unlikely, but unless someone has a crystal ball, I don't think anything is certain either. That's why you come up with Plan B and Plan C.... But I still prefer Plan A!

In regards to innovating in SV... You could always just become a commodities company and sell diodes ;)

Thanks for the insights.

@James Park

My situation is kind of similar. I started buying properties in the Bay Area in 2012, and actually wanted to stay local for all of my future purchases as well. I figured, I was buying good properties in good neighborhoods, so why not milk that for as long as I could?

Unfortunately, the returns all but dried up this year, so I also felt stuck. I had some capital, and wanted to keep investing... but didn't have a market to turn to. So, I looked into areas further out in the Central Valley, but the returns weren't too spectacular... Long story short, I went out of state so that I could keep investing. The returns are pretty good, but I am sacrificing on "quality" to get the cash flow. I used to only want to invest in A++ neighborhoods, but I've adjusted, and my portfolio is a blend now.

I guess sitting on the sidelines is another option, but that isn't much fun, is it? ;)

My strategy is to keep buying out of state until the next market correction, or whenever the deals start to make sense again in my local area. If the opportunity presents itself in the future, I'll re-focus locally and back the truck up! Definitely don't want to miss another opportunity to invest in the Bay Area!

Pete,

Thanks for setting this up. I'm interested in a South Bay meetup, so please keep us posted on date/time.

Reminds me of college... right before a final.

Welcome @Ami Saunders , from another Bay Area investor. Is Novato considered close to Silicon Valley? I always imagined it ways away...

I also want to retire and live off real estate. Looks like you've come to the right place to help make that happen ;)

My own take is that when you are first starting off (as a buy and hold investor), you definitely want to find properties that cash flow right from the start. This not only provides a psychological boost (who wants to lose money?), but it helps you build the snowball and save up for the next downpayment.

If the property is cash flow negative, this will only hinder your progress in saving up for the next investment.

With all that said, I'm not opposed to never buying into cash flow negative properties. Just wouldn't want to do it when first starting out. Later on, that's a different story... For instance, if I could find some killer deals on some beach front properties located next to Laguna Beach or Newport Beach, I would definitely do it, even if they were slightly cash flow negative to start. With a 30 year fixed mortgage, it would only be a matter of time before rents/appreciation caught up. I believe this is the type of approach David Schumacher used to build his empire described in his book Buy and Hold Forever. I agree that this type of investing is more speculation... but location is king... just ask any landlord up in SF! And if you can ever get the thing to cash flow... why sell? In a prime location I'm definitely not selling... buy and hold forever!

@Account Closed You have done an amazing job of acquiring so many Bay Area properties. I'm sure you are the envy of a lot of people ;)

I agree that the residential market is tapped out. I've looked into apartments as well, but the capital needed can be pretty high (for the best deals).

Best of luck!