All Forum Posts by: Alex K.

Hello everyone do any of you know of a good tenant attorney. My buddy is getting his rent raised by 18.5 % from year one to year 2 . 

And they are asking that he signs a new lease. I have no idea if this is legal for landlords to do in a 60 unit property in los angeles county. 

Hello everyone,

I am looking at putting in an offer today on a probate property in California. It's a fixer in a turning neighborhood which I like. Has anyone bought a probate in California before that can shed some light on what I should expect and what to look out for. Seems like my agent doesnt know too much about this process or doesn't want to take it on as in submitting an offer.

I spoke with the listing agent and found out a few things.

Grandchildren live in the house now and are very cooperative on moving they want to get rid of it and move on.

Probate can take anywhere from 45 to 60 days to close but I can do a conventional loan on it which is promising.

Place is a fixer but has a lot of upside potential compared to comps.

Listing agent told me they can up bid in court but it rarely happens.

Agent does not have any offers yet. But, will submit to seller asap as soon as she gets one.

I still get all the same contingencies I would get for a regular SFH purchase. But, it just might take longer than expected since it has to be court confirmed.

Is there anything I should know any help is appreciated.I just don't know what I don't know.

Hello everyone,

I am looking at putting in an offer today on a probate property in California. It's a fixer in a turning neighborhood which I like. Has anyone bought a probate in California before that can shed some light on what I should expect and what to look out for. Seems like my agent doesnt know too much about this process or doesn't want to take it on as in submitting an offer.

I spoke with the listing agent and found out a few things.

Grandchildren live in the house now and are very cooperative on moving they want to get rid of it and move on.

Probate can take anywhere from 45 to 60 days to close but I can do a conventional loan on it which is promising.

Place is a fixer but has a lot of upside potential compared to comps.

Listing agent told me they can up bid in court but it rarely happens.

Agent does not have any offers yet. But, will submit to seller asap as soon as she gets one.

I still get all the same contingencies I would get for a regular SFH purchase. But, it just might take longer than expected since it has to be court confirmed.

Is there anything I should know any help is appreciated.I just don't know what I don't know. 

@Jon Schwartz

Hi Jon ,

Thanks for responding again. I really do appreciate it. So , for the income approach when an appraiser goes to find value for a residential multifamily what method are they using typically ?

Are they still using (NOI / Cap Rate) like in commercial multifamily or are they using a different form of calculating/ appraising value ?

Maybe I'm thinking too far ahead of myself but I want to learn this stuff and this is the stuff that's fasinating selfishly for me tbh.

Originally posted by @Account Closed:

Originally posted by @Kevin Tunnell:

My question is this, based off my income and down payment, I could purchase a 2 bedroom condo right now, but if I wait about 5-6 months I could have enough of a down payment to afford a 3 bed 2 bath single family home. I’d like to House Hack and I am a fairly handy guy and plan on doing some renovations myself. Which route should I go?

I really like the idea of waiting the extra time for the single family home as I feel I can do more home renovation and landscaping myself with the bigger home but getting into a home and building some equity during these low rates is also fairly appealing to me.

This would be my first deal so I haven’t quite found my niche but once I have some cash flowing rentals, I’d eventually like to get into some multi family homes. Any and all advice is appreciated!

 Wait until you have enough money to purchase 4-plex and you will many times more money. Sometimes, there are many 4-plexes you can get into almost for the same price as a single-family home and the profits are almost exponential when you increase the rents even just a little bit every year. Attached, is an example of what 4-plexes can do.

I always found that condos are much easier to purchase than they are to sell when there are many condos for sale in the same complex and buyers purchase other condos all around your condo. I find that owning some condos can be like owning an apartment in an apartment building where you have bad tenants and bad management and you can't pay enough money to get out. Many condos has horrible management and condos can have some serious major expenses both inside your unit and when there is a major problem outside your unit and everyone has to share the cost to replace a $10,000 to $30,000 water, sewer, or gas pipe, or when a pipe breaks under the concrete slab in your unit. 

While the appreciation for some single family properties in some areas you cannot rely on appreciation in many areas. I purchased properties in some out-of-state areas hoping properties would increase by 4% per year and they are not worth a significant amount more, 15 years later. The best money you earn is from appreciation and rental income barely keeps up with inflation, but multi-unit properties increase in value almost exponentially when you increase the rent.

When you purchase properties you should write a business plan where you want to earn 50% to 100% on your investment capital every 1 to 2 years. This is very simple to achieve if you set this business model, but you will not achieve this goal if you don't use this business model.

Example. If you have $50,000 to invest, you want to purchase a property where you will earn 50% to 100% on your money within 1 to 2 years. This is simple to achieve if you put $50,000 down on a house or multi-unit property if you purchase a property that is either  under-priced, or you purchase a 4-plex or more units where the landlord did not make repairs so he could increase the rents and you make a fer minor repairs, increase the rent and now your multi-unit property is worth $100,000 or $200,000 more than you paid and the increased value is based on both the additional income and based on the increased property value based on the rent annual Gross Income multiplied times the Gross Multiplier plus the Annual Gross Income as shown in the image below. YOu cannot increase the value of a single family home by increasing the rents, but you can increase the value by making small improvements like by painting, making changes to give the property more curb appeal, installing new windors, etc., but i a 4-plex or more units will almost always  give you much better profits.

 This made my ears perk up. The only thing I am confused about in this fourplex example is. I thought that up to 4 units I am still tied to comps in my area in Los Angeles?  Does the rents really affect value that much on a 4 plex in los angeles or OC? I am not challenging your opinion , but asking because I am considering a househack on a tri or quadplex in los angeles or oc within the next couple of months. 

Thank you, 

@Dan Heuschele

Thanks Dan you've contributed to some of my other questions as well so much much appreciated sir.

Dan when you say 0 cash invested can you please explain how you got to zero and how you achieved infinite returns. What did you do to have zero cash invested ?

Sorry 😐 I just don't understand fully.

Maybe you refied and got all your money out after doing a rehab for 75 to 80 percent ltv ? Just throwing guesses out.

@Jimmy Woodard

Thank you Jimmy.

@Jon Schwartz

Thank you so much for the info. I think doing renting out as room out of my primary or looking at duplexes is the way to go.

I really really appreciate this info Jon.

I am looking to find a property to Airbnb but I want to do it out of state.

I'm debating two possibilities.

One is buying a place in Los angeles for about 700k (2/3) with 10 percent down that has a detached two car garage in the back and putting in about 120k in for adu to rent it out and get a one percent or so deal.

85k plus 120k means I would be all in for about 205k .

And the return would be 1200 monthly for the rental in the back for a studio with a kitchen and a fridge.

14400 a year in income after 120k roughly invested cash.

85k invested in front house with 3300 per month for piti.

And I would have two room mates at about 800 a month 1600 a month.

And I would pay about 1700 a month for my room to make the mortgage payments.

That seems like alot of cash to put out for over 200k to lose on the front house every month. I have rent control on my apartment I live in now.

So , I would only have about a $ 300 increase in my rent to go from my one bedroom apt to a small room within a 3 / 2 with a back unit. And I can try short term rentals in the back but due to Los Angeles restrictions I think I can only do 120 days a year for 30 days or less.

Or I can find a property somewhere else that works as a long term or short term rental that might cashflow better. Any suggestions on any areas?

I don't expect people to just hand me areas. I suspect Houston and Scottsdale would be great ones.

Any thoughts on this guy's ? Btw I have ran an Airbnb before in Los angeles in the past.

So I do have some experience running one rental and have been thru some crazy stuff with that lol. But it was stressful fun and I want to do it again.

My goal is to really have healthy cashflow I can duplicate and if I get appreciation great if I don't I'll just pay off mortgage over the years and just retire on cashflow 30 to 40 years down the line.i rather manage and hustle for more cashflow. I'm in my early 30s now with great credit and healthy savings with decent income for Los Angeles standards and I have great energy levels to take something down.

@Michael Plante

How do I do that ? Can we talk more about this I would really like to explore all my options.