All Forum Posts by: Jimmy Lieu

Quote from @Ivan Castanon:

For the past 6 months I’ve been looking for houses (both SF and MF) that can produce at least a little bit of cashflow with around 20% - 30% down.

However, I’ve started to realize that this is pretty much impossible these days.

I currently have $110k sitting in my bank ready to be invested but I just can't find anything that will at least produce a 3% COC return. I've been looking for properties in and around Tampa, Orlando, and St Pete but I can't find anything that's worth it.

I’m starting to realize that I need a new strategy. I can’t keep looking for properties that will cashflow because I feel like I’m wasting my time at this point. I really want to invest in RE but I just don’t know what to do. Any recommendations? What other ways can I invest in RE in the current market.

Hi Ivan! I would recommend taking a look at Columbus Ohio! With $110k cash, you can easily buy 2-3 positive cash flowing rentals here. The macroeconomics are on fire here - population growth, job growth, and companies moving and developing here. For example Intel headquarters, Google, FB, Amazon, Nationwide, Honda, (recently Anduril announced another 4k jobs to Columbus). Additionally, the price point is still cheap enough to find the 1% rule and positive cash flow and there's amazing appreciation potential. Lastly, the price point is still very cheap here in the sense that you can still find investment deals that hit the 1% rule for 120-180k! Happy to connect and answer any questions you have!

Quote from @Nick Connors:

Hello everyone! I'm a 26 year old from Long Island hoping to acquire my first rental property by the end of the year. I do pretty decent for my age, and I live at home still, so I've been saving up a lot of money. Sad reality is I'll probably own a few rentals before ever moving out. That's just how it is here. With that being said I'll obviously be focusing on out of state.

I know Ohio is mentioned a lot around here, specifically Columbus, and I'm an Ohio State alum, so that would be pretty cool to secure my first property in Ohio. I'll be looking for long term rentals that don't need any major repairs initially. I'm terrified enough of doing this out of state, so I am not interested in additional complexities with BRRRR. I'd feel comfortable investing ~$50k to start off. Seems like I could possibly get a duplex with that kind of down payment. I've considered going Dave Ramsey and buying a house with cash and upping my budget to $100k in a smaller market, but that would blow almost all my savings, and $100k just doesn't get you much anymore. Plus I need to leave my folks' place at some point lol. So loan it is.

A few thoughts/questions on my mind that I hope to learn as I continue my real estate journey:
1. How do you actually strike from out of state in a timely manner?

2. Tips for setting up an LLC

3. How can I connect with local investors?

4. I'm terrified of doing all this research, finding a "dream" property, only for it to fail and negative cash flow. What are common things beginners overlook?

Hi Nick,

1. You can invest OOS but the biggest thing is working with an investor friendly agent. You need to make sure you're working with someone whose sending you personalized deal flow that actually meets your buying criteria. Additionally, they should be helping with taking video walkthroughs of the location and the property, estimating renovations/scope of work, helping you learn neighborhoods, building your real estate team, etc. But the most important thing is breaking out of the paralysis analysis stage and taking action!!!

2. You can set up an LLC after you've gotten under contract on a deal! A lot of investors put a lot of weight into their LLC but to be frank, it doesn't really matter until after you've gotten under contract.

3. You can reach out to a lot of investors from local FB groups!

4. Make sure that you're properly vetting your team members especially your agent that you work with - your investor agent should be looking out for your best interest and should be able to explain why something is a good/bad deal. There's a lot of agents who are "yes" men and will say everything is a good deal. If you work with someone like this, you need to run as fast as possible!

5. I know you mentioned Columbus Ohio. A lot of my out of state real estate clients really like this market because the macroeconomics look so good for this market - population is growing, job growth is growing, and so many companies moving and developing here. Look at Intel headquarters, Google, FB, Amazon, Nationwide, Honda, etc. Additionally, the price point is still cheap enough to find the 1% rule and positive cash flow and it's super landlord friendly (so you will never have to go through a 12 month eviction or anything close to that!). Lastly, the price point is still very cheap here in the sense that you can still find investment deals that hit the 1% rule for 120-180k! Happy to connect and answer any questions you have!

Quote from @Benjamin Ying:

Quote from @Jimmy Lieu:

Quote from @Benjamin Ying:

Hey all! First time poster here so let me try and lay down the situation.

My wife and I are just beginning our real estate investing journey. We live in California so I think the opportunities are better when it's OOS. Some areas I've been looking at are Provo/Vineyard, Colorado Springs, Indianapolis and Raleigh/Durham. Current timeline to purchase is probably 6-12 months as I start narrowing down and visiting some of the places to get a better idea over the next few months. Our downpayment budget is probably $60-$100k.

Questions:

1. Does focusing on macro trends (Population growth, rental and appreciation growth, good jobs) offset the 1% rule?

2. My friend is a big investor in Provo and has connections there. Would it make sense to reduce risk and use his connections first and invest it that area? Curious what experience others have had done.

3. Should I expand my target metros? These areas are relatively easy as a direct flight from SFO and one of the BP videos mentioned how it's a good idea to be able to fly direct if you have a OOS investment. For example, Columbus or Huntsville, AL has come up a bunch of times but I’d have to transfer.

4. Do you definitely need a property manager for OOS investing, especially as a first time investor? It seems like that would eat into the returns and you can't get positive cash flow for a while

5. Is it just a bad rule of thumb for an investment if you can't get positive cash flow for the first year or two? Or is this normal?

Hi Benjamin! Welcome to BP and I'd love to help answer some of your questions.

1. No, you do not need to sacrifice cash flow for good macros. You can get both in a real estate market. For example, here in Columbus Ohio, you have amazing macros (population growth, job growth, and companies moving and developing here like Intel headquarters, Amazon, FB, Google, Nationwide, and recently Anduril AND you can still find positive cash flow and the 1% rule here PLUS there's AMAZING appreciation potential.

2. You would definitely have an advantage investing in a market if you already know people there but there's tons of investors who invest in markets they have never visited or seen before. So don't be confined to just areas/markets that you know people in! If you have a great investor agent, he'll be able to help with finding you personalized deals, helping you learn good/bad neighborhoods, estimating renovations/scope of work, setting you up with his team, etc.

3. Definitely go with a PM as an OOS investor. You do not want to be taking 2AM calls at night about a clogged toilet from across the US. You can still get positive cash flow even accounting for a PM - tons of my clients do as well!

4. No, it's not. If it's a deal that is in a very very desirable location and has tons of built in equity and appreciation, I would be totally good with negative cash flow for Y1 and Y2. It is really situational and depends on your resources.

Happy to connect and answer any questions you have! :)

 Thank you for the clear and concise answers Jimmy! Columbus has been coming up a lot and would love to learn more. Do you have any more materials to share with me about the market? The metrics I'm primarily focused on are: rent appreciation rate, property appreciation rate, economic growth rate, unemployment rate on the macro level.

Yup, I'll connect with you! :)

Quote from @Robert Pickett:

I am in CA too and it is a dead end situation with prices and very little prtection for landlords.  I am exiting the rental market here (love living here tho). Strongly suggest scoping out GA, TN, OK, PA, AL, IN, etc.  Lots of info out there.  Look for Facebook groups too.  Good luck. 

Hi Robert, I would look into Columbus Ohio as well. Still tons of positive cash flowing deals that meet the 1% rule and amazing appreciation here! Plus the macroeconomics are on fire with job growth, population growth, and companies moving/developing here. For example, Intel headquarters, Amazon, FB, Google, Honda, Anduril, etc! So much stuff going on here!

Quote from @Trace P.:

Hi everyone! My partner and I have ~20 doors in Columbus OH, and we are interested to expand our portfolio to Cleveland, including around Lorain and Euclid. We do long-term rentals and practice BRRRR on every deal. Looking to connect with any investors, realtors, property managers, contractors, wholesalers etc from the area :) Feel free to comment or DM! Thank you!

Congrats on 20 doors in Columbus Ohio! It's an amazing market to be in because you can still find the 1% rule and positive cash flow while getting amazing appreciation potential. Absolutely crushing! :)

Quote from @Benjamin Ying:

Hey all! First time poster here so let me try and lay down the situation.

My wife and I are just beginning our real estate investing journey. We live in California so I think the opportunities are better when it's OOS. Some areas I've been looking at are Provo/Vineyard, Colorado Springs, Indianapolis and Raleigh/Durham. Current timeline to purchase is probably 6-12 months as I start narrowing down and visiting some of the places to get a better idea over the next few months. Our downpayment budget is probably $60-$100k.

Questions:

1. Does focusing on macro trends (Population growth, rental and appreciation growth, good jobs) offset the 1% rule?

2. My friend is a big investor in Provo and has connections there. Would it make sense to reduce risk and use his connections first and invest it that area? Curious what experience others have had done.

3. Should I expand my target metros? These areas are relatively easy as a direct flight from SFO and one of the BP videos mentioned how it's a good idea to be able to fly direct if you have a OOS investment. For example, Columbus or Huntsville, AL has come up a bunch of times but I’d have to transfer.

4. Do you definitely need a property manager for OOS investing, especially as a first time investor? It seems like that would eat into the returns and you can't get positive cash flow for a while

5. Is it just a bad rule of thumb for an investment if you can't get positive cash flow for the first year or two? Or is this normal?

Hi Benjamin! Welcome to BP and I'd love to help answer some of your questions.

1. No, you do not need to sacrifice cash flow for good macros. You can get both in a real estate market. For example, here in Columbus Ohio, you have amazing macros (population growth, job growth, and companies moving and developing here like Intel headquarters, Amazon, FB, Google, Nationwide, and recently Anduril AND you can still find positive cash flow and the 1% rule here PLUS there's AMAZING appreciation potential.

2. You would definitely have an advantage investing in a market if you already know people there but there's tons of investors who invest in markets they have never visited or seen before. So don't be confined to just areas/markets that you know people in! If you have a great investor agent, he'll be able to help with finding you personalized deals, helping you learn good/bad neighborhoods, estimating renovations/scope of work, setting you up with his team, etc.

3. Definitely go with a PM as an OOS investor. You do not want to be taking 2AM calls at night about a clogged toilet from across the US. You can still get positive cash flow even accounting for a PM - tons of my clients do as well!

4. No, it's not. If it's a deal that is in a very very desirable location and has tons of built in equity and appreciation, I would be totally good with negative cash flow for Y1 and Y2. It is really situational and depends on your resources.

Happy to connect and answer any questions you have! :)

Quote from @Jade Frank:

Hi, I'm Jade and I'm looking to get started with real estate investing. We have one property already as our primary home with a plan to buy another house and rent out this one. Then I plan to become a travel nurse and we will live in the RV while the two are being rented out and go from there buying more properties. Is this a bad goal? Can anyone give me advice? I'm scared to purchase a second home but we have the funds to do so

Hi Jade! Instead of living in an RV, I would look into house hacking in a cheaper state and starting your real estate investing journey there! That's actually what I did myself when I moved from Portland Oregon to Columbus Ohio (got priced out of my own market)! Or I would recommend looking at out of state investing. I personally do recommend Columbus Ohio for many reasons. First is the macroeconomics here are absolutely blowing up here - population growth, job growth, and SO MANY companies moving/developing here. For example, Intel headquarters, Honda, Amazon, Facebook, Google, Nationwide, and recently Anduril which is adding another 4,000 jobs here! Additionally, you can still find deals that will cash flow and hit the 1% rule and amazing appreciation potential. Any real estate you buy here you want to hold for the rest of your life because of how many growth is projected here! Happy to connect and answer any questions you have :)

Quote from @John Lasher:

I've heard from so many investors that they have put a pause on their flipping business. Simply because rates are higher, homes are not selling, and deals do not work. Are you seeing the same thing in your market? Are you still successfully flipping right now?

I never recommend flipping - something as a slight change in the interest rate markets can completely turn your flip upside down. Financial freedom is all about buying and hold properties for the rest of your life - that's how you get appreciation, cash flow, principal paydown, and depreciation.

Quote from @Fulati Paerhati:

I am selling one property and planning to do a 1031 exchange. I will have about 200k-250k cash from it. Any good area so you recommend for buying a rental property ?

Hi Fulati, I would suggest taking a look at Columbus Ohio! With $250k in cash, you can easily do down payments on 5-6 rental properties here. So many population/job growth/companies moving and developing here - Intel headquarters, Google, FB, Amazon, Nationwide, Honda, Anduril etc. Additionally, the price point is still cheap enough to find the 1% rule and positive cash flow and it's super landlord friendly (so you will never have to go through a 12 month eviction or anything close to that!). Lastly, the price point is still very cheap here in the sense that you can still find investment deals that hit the 1% rule for 120-180k and in great residential location! Happy to connect and answer any questions you have!

Quote from @Emily Shin:

Hello, I am new to this community and to real estate investing. Currently, I live in New York, but I am interested in exploring opportunities in Columbus, Ohio. This will be my first home purchase, and I am aiming to invest in multi-family properties.

What should I be aware of when purchasing a multi-family property? I am considering living in one of the units myself. Do you think that’s a good idea? Would living in the same property as my tenants have any downsides?

Any advice is greatly appreciated, and I look forward to connecting with all of you

Hi Emily! As someone who has house hacked many times and have helped others house hack, I would let you know there's a lot of pros and cons to this strategy! First pro is you learn how to be a landlord and to manage properties and this is the best way to get started into real estate investing. Second pro is that you get to lower your living expenses or live "rent free" by having your tenants pay for your mortgage payment. However, the biggest con is that you are sacrificing a bit of your privacy by living right by your tenants and it is usually a lot more stressful since everything is your responsibility - managing tenant issues, handyman repairs, taking care of the lawn, etc.

I would strongly recommend house hacking especially in the Columbus Ohio market! There's so much happening here! For example Intel headquarters, Google, FB, Amazon, Nationwide, Honda, (recently Anduril announced another 4k jobs to Columbus). Additionally, the price point is still cheap enough to find the 1% rule and positive cash flow and there's amazing appreciation potential. Lastly, the price point is still very cheap here in the sense that you can still find investment deals that hit the 1% rule for 120-180k! Happy to connect and answer any questions you have!