All Forum Posts by: Kevin Crawford

Hello everyone,

Same here I could do the 17th or the 8th

@Katie P., sorry I cant make it to Berkeley on Sunday but thanks for the invite and please keep me in the loop for future meetups being that's its close by to me

great event last night.  I enjoyed the format and it was very informative.  I look forward to the next one

I'm in Pinole, I'll make if I can

I'm also glad I found this discussion.  My wife and I can barely afford a rental here in the SF Bay area so I've been looking at OOS options.  My initial research has pointed me to OKC as a good option.  Do you guys think OKC is best to buy in or curtain areas around it? 

There seems to be quite a few OK locals here.  Do you think its worth looking into SFHs as well? Or do you think without question, the multis will give better cashflow in this area?

I'm considering Richmond as one of my cities to find a rental in but I have no experience with the rent control practices.  Can someone familiar with the area's laws shine some light on this.  Are all the bay areas cities with rent control the same in terms of the practices.  I know of Berkeley and Oakland have it as well.  

 This is my current understanding of it.  If I buy a property built before a certain year that currently has tenants in it, I cannot raise there current rents beyond the allowable increase for the year(3%-4%)  I would have to wait until any of the units becomes vacant to raise rents to current rent rates.

Is this correct so far?  And is there other important information I'm missing that you can share?

Thanks in advance BP community

Of the cities I can afford to get a rental near me I've compiled a list of rents to use as references in my quick property analysis.  These are for a unit with washer/dryer accessibility and tenant paying utilities.  I realize there are areas in these cities where you can get more or less rent.   I'm making a quick reference of median rents for these cities for quick calculations to weed out obvious properties.  I pulled these numbers from a combination of rentometer, rentcafe, and craigslist.

Any of you currently working in these areas, can you confirm your areas rent is about right or correct me if I'm way off please.  I welcome any additional information or advise you have as well regarding these areas. 

Richmond

Studio          $1600

1 room apt  $1650

2 room apt   $2000

3 room apt   $2150

3/2 house     $3000

4/2 house     $3400

Vallejo

Studio            $1250

1 room apt    $1300

2 room apt    $1450

3 room apt    $1700

3/2 house      $2600

4/2 house      $3000

San Leandro

Studio              $1700

1 room apt      $1750

2 room apt      $2100

3 room apt      $2250

3/2 house         $3000

4/2 house         $3400

Sacramento

Studio             $950

1 room apt     $1000

2 room apt     $1200

3 room apt     $1500

3/2 house       $2300

4/2 house       $2500

Hi Ian,

I'm also in Pinole and my wife and I are also in the process of finding our first rental property.  I'm currently looking in Richmond, Vallejo, San Leandro, and Sacramento as options for my investing because I think we can only get a property for $500k or below.  If you haven't owned a house before you can get into a house or duplex-fourplex for 3.5-5% down.  You can House hack it.

  If your brand new to this world, my advise to use realtor, redfin, or other MLS site and a rental property calculator and start analyzing deals, all the ones you can in whatever area your interested in.  It will force you ask questions and answer all the questions you don't know to ask yet.  use craiglslist to find the rents.

   Listen to the podcast, set up keyword alerts in the forums, and read books.  You'll be surprised how much more you'll know in a matter of weeks or months.  

  Also there is a (how to flip a house) event that David green is hosting in Brentwood on sep 27th.  If you can go to that I'm sure you can meet people and ask questions.  If your interested, go above to networking, events, and type in your zip to find the info.  

I'm still learning as well Ian so I can tell you everything, but no matter the question you have I'm sure can find answers here.  

Ya that makes sense. I didn't take that into account when I was figuring things. I suppose that would be the smartest way to do it to keep our primary residence payment the same and at a lower interest rate than current rates. Not having done a BRRRR deal yet, how long do you have to wait to refinance the rental. You said six months. Is that just how long you think it will take to rehab it. And how much can you pull out during the refi?

By my calculations, you'd lose $100-$200 a month with the deal price and rents as the are. If you were to get it for 380,000 and be able to bump the rents another $100 each you would be cash flowing $100-$200 each. but even then it would be at around 2% cash on cash ROI.

I think that's one reason  why its been on the market for 4.5 months

So My wife any I have quite a bit of equity in our house.(primary residence)  We want to pull the trigger on buying our first rental property but I need to decide on a course of action for the down payment.  Initially my wife was pushing for the heloc as the method to get our down payment money but I insisted on as closely as possible comparing the numbers to the cash out refi.  I gathered the numbers from the banks on both and she inputted everything into her excel sheet.  

current house value $620k

remainng balance $194k

credit over 800

looking at pulling $150000 or $200000 out for investing

When comparing the same increased monthly payment on both options over 30 years  we ending up seeing quite a difference.   

With the $150k heloc vs cash out refi, the heloc would save you quite bit of money over the life of the term and increase our monthly payments around $600

If we go for the $200k option,  the cashout refi saves quite a bit over the life of the term and increases our monthly payments by around $900

Does this make sense to others who have looked into the numbers?

The other consideration is order of operations.  Is it preferable to refi the house and then later get a heloc for more investing?  Or can we get a heloc now and have it not effect refi ing the house later for more inversting?

Any questions or advise always welcome