All Forum Posts by: Mike Bolen

@Dan Nim You're an anonymous keyboard warrior who cannot even white night for a random woman on the internet correctly. The only thing disrespectful and ironic is the way you treat yourself. You're an average man, living a below-average life who is so embarrassed by your own existence you must remain anonymous on the internet. 

@Dan Nim you must be new around here. Yes, I read the article. Here's one from the past 24 hours showing the numbers improving even more. Really tired of anonymous, keyboard warrior beta males like you cowering in fear who cheerlead death tolls. You scared? Stay in your house. Fact is Sweden, Belarus, Netherlands and numerous states with no lockdown orders are having little to no issues except in high-risk population sectors. https://www.dailymail.co.uk/news/article-8210677/amp/Sweden-records-17-deaths-coronavirus-lowest-daily-rise-fortnight.html

San Bernadino and Riverside just announced they are allowing Easter Services at churches this weekend. I think folks are getting fed up with this. Also, Alabama is now saying they plan to reopen on April 17th. It's time to get people back to work

@Collin Chan Welcome! I’m in Napa Valley also. Which city did you buy your investment property in?

Napa Valley is VERY aggressive on policing non-permitted short term rental units. This poor guy was just fined over $122,000  . 

This guy was actually arrested at his home and imprisoned for running an Airbnb in Napa without a permit  . As far as I know, the city of Napa is the only city in the country to actually arrest and imprison a person for running a non-permitted Airbnb. 

We have run a lot of research and manage many short term rentals. The easiest way to analyze a deal is to simply make sure your property does an absolute minimum of 20% of the purchase price per year. At this level, you will make a small profit. Most properties we manage do 33%+ of the purchase price annually in gross income. If you violate the 20% rule you'll lose money and in all cases be better off doing a long term rental on the property. 

@Jodi Low You certainly don't have to go out of state, inexperienced and uneducated investors always lean on the, go out of state crutch. There are deals everywhere in Napa, Sonoma & Solano. As an example, I purchased a 4 plex in Vallejo 1 year ago for $350,000 which needed some updating, after rent stabilization at $1,900 per unit the gross cash flow is $7,600 monthly. I come across similar deals every day, don't waste time on a loser deal.  

The market tells you it's a garbage area. In Napa Valley, there are 3 waterfront neighborhoods, Riverpark, Yacht Club & Milton. The average sales price of the prior 3 sales are; Yacht Club $1,278,333, Riverpark $1,101,667 then Milton $672,300. If that news isn't bad enough the last sale on Milton was in May of 2019. So the market is telling you this is a dismal location to invest.

I don't understand your 2nd question. I would not invest a nickel in the property I would sell it as-is and invest the money in a better area with much better cash flow. 

The 1% rule comes from my 25 years of experience as a very successful real estate investor. If you are running a long term rental it MUST generate a minimum 1% of the value in gross cash flow each month or you are losing money and you will go out of business. Additionally, the market says you can get greater than a 1% gross cash flow monthly so why would you subsidize a tenant's living situation with your hard-earned money?

@Jodi Low I have done over 600 transactions in my career. I'm assuming this property is located on Milton Road. Generally speaking, that is a garbage area of Napa Valley and nothing I would want to own long term. Let's say the property is worth $600,000 simply using the 1% rule your monthly rental income with a long term tenant should be $6,000 per month minimum. If your investment doesn't meet this minimum standard it should be sold and capital repositioned. I wouldn't attempt a fix & flip on Milton road as the comps are not strong and days on market are long, especially if the property is located after the railroad bridge. Your best move is to sell as-is and use the capital in a higher-yielding investment.  

@Steve K. Screaming Eagle is some fine vino, owned by Los Angeles Rams team owner Stan Kroenke.