All Forum Posts by: Melissa Dorman

I'm in the LA market and was about to buy a duplex. Then my partner got into Grad school in Portland. I ran the same numbers up there and was sold. Way better returns than Los Angeles and I can guess Bay Area as well. Instead of a duplex, I am shooting for a 4 plex now. If you are investing from out of state, you might loose a lot of the value that comes with being on the ground. If you are considering the move, I would go for it. Actually, I am going for it. haha 

I would analyze your return on investment on a few different scenarios. For instance, if you take out that money and build a unit, how much net profits will you make on the first year (cash on cash) return? Then look at a small multi-family (2-4 unit) that you could purchase down the street with that money as a 25% down payment? How much cash on cash return would you get. Basically, which situation is your money working the hardest for you. I'm doubtful that it would be the add-on, but let the numbers tell the story. Another factor is what you are willing/able to manage. If building in your backyard is the only way feasible for you, then build. 

If it is affordable, it may be worth sub-metering the building. If you go the route of separating the rent from the utilities fee, what happens if the tenant pays rent but not the utilities one month? That could create an issue in court if you need to evict. And then you are faced with the question of if you are willing to evict over utilities fees? If you are planning to hold the property for the long term, might be a good investment to sub-meter. Might even save money in the long run to avoid such a situation. 

Thanks everyone for the fantastic advise! We are seriously leaning towards moving to Portland.@David Faulkner I love your advise! The great thing is my partner would move about 6 months prior to me and scope the place out while she rents. We are thinking we will buy a duplex in LA now for me to live in for this year and then when she learns the market (and I have enough pennies saved again), we will make the next purchase (maybe a "second home" 10% down mortgage) and I will join her in Portland. Thanks @Robert Klisak for the specific zip codes to look out for. 

Thanks @Lynne C. for your response. I really like the second property you mentioned. The price is right and the neighborhood looks nice. Ideally, I would want a small duplex for that price, so I could live in one side and rent the other. Any ideas on zip codes/areas to look at or ones to avoid? 

Hey all, 

I'm from Los Angeles. My partner was accepted into Portland State University for a master's program. We are not sure if it's a viable place to move/invest given our limitations. 

I would have about $60,000 saved up from my current job for a down payment, but pretty sure I would need to put 20% down initially until I found a job there. I could use my current income in Los Angeles to get the loan until we moved.

Are there small multi-family or single families within 30 min of downtown that cost $280,000 or less?  What are some zip codes you suggest? Thanks! 

Are you accounting for your holding costs in the 40k repairs? what kind of financing are you using? If it's all cash, then you have minimal holding costs (property taxes, utilities, insurance) 

Off the bat, your margins look small. Unless someone knows something more creative than a simple flip as your exit strategy. 

I would also leave a 10% for your repair costs to spill over as a buffer (like an additional 4k). 

After your holding costs and a conservative ARV and getting several quotes on the repairs, see if the numbers still work.

@Kyle Myers  that is a great list! I'm thinking of assembling a team (agent, property management, appraiser etc) instead of going the turnkey route. I live in LA so I would be doing this from a distance and likely do a trip to shake hands and meet in person once I have prospects for each team member. Do you think this is realistic? or is turnkey the way to go? 

@John Duguid I'm pretty open. I have some family in Rockford, Illinois and Paris, Tennessee but not sure those markets are strong enough in terms of economy and renters.  Still working on my first owner occupied in Los Angeles. Just doing preliminary market research at this time as I plan to buy that property next year, in the spring. 

@John Duguid welcome to bigger pockets (i just got here practically myself). do you have any rental properties yet? If so, anywhere in the greater Los Angeles or within 2-3 hours away? Sizing up where I might make my second purchase after I buy an owner occupied duplex. Looking either just outside of Los Angeles, maybe as far as bakersfield, or perhaps out of state. If you are familiar with any markets that have 10% or higher cap rates or cash flow $300+ per unit, let me know.