All Forum Posts by: Jonathan Luna

Hello... Are there any wholesalers in Inland Empire here on BP? The market here seems competitive and there is not much help available. I have found bp very helpful, so I am wondering if i can find anyone in inland empire to work with. Thank you

I am starting to work again in SB area.  It has been very good for me and my investors. Very low vacancy rate, average rents goes for 1200 to 1500 for 2 to 3 bedrooms depending on the area. Multi family properties hard to get. Very competitive !

My partner does property management And business is great. Rentals are in high demand. Problem tenants are always there but we don’t have too much trouble.  Have helped a group of investors buy 140 homes for fix n hold and are very happy with SB. Fix n flip is highly competitive but deals come up for aggressive investors. All in all I highly recommend SB. 

Best of luck 

I am starting to work again in SB area.  It has been very good for me and my investors. Very low vacancy rate, average rents goes for 1200 to 1500 for 2 to 3 bedrooms depending on the area. Multi family properties hard to get. Very competitive !

My partner does property management And business is great. Rentals are in high demand. Problem tenants are always there but we don’t have too much trouble.  Have helped a group of investors buy 140 homes for fix n hold and are very happy with SB. Fix n flip is highly competitive but deals come up for aggressive investors. All in all I highly recommend SB. 

Best of luck 

@Jonathan Luna

i would recommend waiting till 2020. lots of landlord have not kept pace with market rents and just lost tons of equity based on proforma rents which was fueling the multifamily craze in southern ca due to rent control laws statewide.

my two cents

@AJ Singh

Thank you! Being a california investor yourself where do you look for properties to invest in? 

@Jonathan Luna I'm currently working on my second one in 12 months. The first one that I purchased was pretty much turnkey. I did have to paint the entire interior of the house (the color was not renter friendly) and install a washer, dryer, and refrigerator. Within three weeks of purchasing it we had 38 applicants and 3 exceptional applicants that wanted to give us a deposit. With that luck we decided to start saving to buy our second (before finding BP and BRRRR) and recently put our second place in Richmond, VA under contract.This one will require a bit more work but I'm partnering up with a good friend. After running out numbers we have decided to not let the deal go and flip. The sensitive thing about Richmond is the average rent threshold. If your mortgage won't allow for you to rent it out for $1,110-$1,400 then its not worth keeping (in my super conservative option).

In my opinion Richmond is the perfect rental market. People are not interested in buying unless they are white collar workers, which most people there are not. Also, the scene is very transient and organic. There are always new restaurants, pubs, and hangout spots that people want to work at or live close to and don't really care to commit. Also, having the inside scoop (since my wife works for an international property management company) large companies are making concerted moves to Richmond (billions of dollars). I'm sure that their research is better than mine, so I'll go with it. 

I hope this helps

-Carlos Salazar

Good news is that you aren't alone. Many people from California feel the same way and tend to target the Turnkey markets. Tons of turnkey markets out there. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. In no particular order I have listed some of the most popular markets for out of state investors

• Cleveland, Ohio
• Dayton, Ohio
• Toledo, Ohio
• Youngstown, Ohio
• Cincinnati, Ohio
• Memphis, Tennessee
• Birmingham, Alabama
• Kansas City, Missouri
• Saint Louis, Missouri
• Indianapolis, Indiana
• Detroit, Michigan
• Erie, Pennsylvania
• Louisville, Kentucky
• Milwaukee, Wisconsin
• Jackson, Mississippi

Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.

One thing to note when looking at the individual markets, you can make or loose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.

• Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
• Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
• Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
• Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
• Make sure your property manager is a licensed real estate brokerage.
• Understand you can not eliminate all risk, only mitigate it. If you are risk adverse real estate, (especially out of state) is not for you.

Hey! I live in Maryland, just one hour away from baltimore and I will not invest there. In fact, I went to baltimore today to talk to fellow investors and I still don't feel comfortable. As @Ian Barnes said "You have to have amazingly good boots on the ground. If not, your screwed". Instead I have been pouring my money in Richmond, VA and I have been doing really well. I would suggest looking into that market as well. If you have any questions please feel free to reach out (Im headed down to Richmond tomorrow to look a few deals)

@Ian Barnes

Hi Sandra M,

Welcome to BiggerPockets, (and happy Mother's Day if that applies to you.)

You bring up some very good questions and concerns here:

1.) The bay area is nice, but very expensive. We are also seeing a bidding war here in southern California since inventory is so low. It's just crazy. But as I always like to say, "Live where you want. Invest where it makes sense!"

2.) Congratulations on your first investment. The rent to value ratio is good, but I hope the expenses, particularly the property taxes, aren't eating up most of your cash flow. The issue I have with most of the coastal states are the high property prices.

3.) I'm a big fan and advocate of buy-and-hold investing. It's all I've focused on since 2004 and it's what I 'preach' to my clients. So, congratulations on your decision there.

4.) If you have good credit, as you've mentioned, then it shouldn't be hard to get financing. Our investor clients are getting loans on their properties with 20% to 25% down (maximum leverage) and generate very good returns. Therefore, if you have the ability to finance (leverage) your investments, you'd be able to buy and control more real estate, and that should serve you well in the long term as your equity builds across multiple properties.

5.) As far as your next market, I am not a fan of California. There are many great markets all around the U.S. Many with property prices below their replacement costs. You want to look for a stable or strong housing market, good economics, lower unemployment, and job growth, among other factors. I've posted many of my favorites on my website.

Feel free to post any other questions you may have.

Continued success!

Hi Sandra. I live in LA and only invest outside of CA. The two markets I think are the best right now are Houston and Chicago. Houston I'd say is probably one of the #1 markets for rentals right now (depending on the factors you consider) and Chicago has some amazing deals right now and being one of the world's most economically powerful cities, good market for long-term and great cash flow. There are other good smaller markets out there also.

The thing I look for is where are people moving and wanting to go that the numbers work. That's where I go.