All Forum Posts by: Kenny Simpson

Good evening,

Upon completing graduate school I am looking to find a home that needs significant work done to having construction and renovation skills. I intend on making the home the primary residence as a first time homebuyer. Unfortunately, I am not a cash buyer, however there is considerable capital I can put down.

It seems as though the San Diego market quite rarely has good opportunities that are on large listings. There is not too much concern on neighborhoods or schools, yet it still seems like quite the tall task.

If anyone is aware of any tools that allowed them to more easily locate some of these listings it would be greatly appreciated.

Is there some sort of website, groups, service, or even social media accounts that would have this information? 

If you had 600k to start in rental property investing, what kind of home would you go for? I will have that much available to me in one year. 

To give some more info, I live in San Diego where you can find a 1,000-square-foot home in a safe, decent neighborhood (although inland and less upscale) in this range. I am just starting to analyze some listings in the county, but I am also open to looking outside southern California.

My goal is to build my real estate portfolio in ten years to the point where I can live off of it. I know that's ambitious, but I think it's do-able, right?

Yes we do, we have equity in our primary home for a HELOC - we talked to one bank and they offered a prime + 0 rate, but we would want to shop around and see what other rates/deals on rates are being offered.

Converting my 505 sq foot garage into a ADU. Im looking for market specific tips to estimate the potential property value increase. There is also only 1 comp for rent near me, making the estimated rent fairly hard. Im in oceanside california about 13 minutes inland. Struggling to decide if the long term play or the short term play would be better. I know there are a lot of factors here to consider but id love to get some advice.

The ADU: bedroom separated from living room, full bathroom, kitchenette, washer and dryer. Everything is going to be fairly nice with the bathroom and flooring being on the higher end.

Hello BP! 

Here is a quick summary, my partner and I are in Southern California and we completed our first ADU project around 6 months ago. The project turned out great and we are looking to start our next one in the next couple of months. The first time around we used a conventional loan to purchase the property and then we used cash to build our two ADUs.

We are looking to take on a bigger project and will be needing a few different loans: Acquisition, Construction, Permanent. I think the best we can do is acquisition and then do some sort of construction to perm loan. In a perfect world we could find a lender that will work with ADUs that can bundle all these loans together to simplify our financing and save on some closing costs.

Here are a few more details. Acquisition will most likely be between $800k and $1Mil. Construction costs will be $600k to $1Mil depending on how big of a project we take on. Permitting time is around 6 months and construction will be 12 months.

Any advice on specific lenders or financing strategies would be appreciated! 

Thank you!

I'm looking at an 8 unit complex in San Diego that I am researching converting to condos to sell individually. I've read the info bulletin 539 from the city and looks mostly straight forward but can't tell if it's a guarantee. Anyone have an attorney or engineer who does this? It is outside of the coastal commission also.

Is there a DSCR lender that will lend in rural designated areas? Properties would be located in TN.

Thanks!

Help, hive mind.  I've been lurking and learning. Now I need to sell a property, and I'm stuck.  Some kind of math/logic fear.  Here goes:  I invest in the Bay Area and San Diego metro area. I run my property taxes using 2% (it's 1.17 for SF County and 1.16/1.23 for San Diego County).

Condo #1 in SF has PITI/HOA of $1150 + 650 + 710/mo for a total of $2510. Insurance/Management fees: -0-
Rent is $3100. Net $590 (not counting maintenance/cap ex). Speaking of CapEx: I didn't factor these into my monthly costs. I have over 6 months reserves for each property. Not sure of the # I should be using for it. Repairs: Again - not sure of the #. Because they are condos, repairs have been minimal, last SF condo turnover and repairs cost about $2000 (not including my time).

Vacancy rate: I use 5% - may use more now that market is softening.  Utilities: Tenants/HOA pays for water, trash, sewer, outside maintenance. Utilities run about $100/mo. - gas/electric/internet.  

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Condo #2 - San Diego. Owned outright, HOA $800 per month including special assessment. HOA pays for water/trash/outside maintenance. Other utilities about $150/mo. Taxes about $600/mo. Was renting for $4200. Last tenant turnover/repairs cost about $4000 including new fridge, w/d and stove.

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Child #3 is a 4 plex in San Diego. No HOA, mortgage is $1650 and taxes about $900/mo. Tenant pays for gas/electric/internet. Those items for the empty units are about $60/mo. total. Management fee 5%, insurance $150/mo. Rental market is softening/readjusting. These units used to rent for $3400/mo., I have one rented for $2800 and am looking for vacancies at $2500. $600/mo. taxes.

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So - which of these children should I sell?  I want OUT of CA and evaluating where to jump next.  This is my first step, not sure where I want to jump given a 1031 is in my future.

Many thanks for the shared brain cells/info/generous knowledge. 

I am due to recieve 50k in captial gains from an inheritance this week which falls under my 2022 taxes (that now has to be amended). In talking to my tax lady that 50k throws me into another tax bracket which has me losing all my tax benefits with my real estate investments and I'll be owning the IRS 18k. Does anyone know if there is a way to protect some of that money?