All Forum Posts by: Nick Colvill

 Look at the S&P 500 trend. it basically encompasses the stock market. You would see that in the past year the prices are starting to consolidate instead of a steady up. That is a sign that investors are liquidating assets. When that starts trending down, that will initiate full liquidation of companies. That's the simple version of it. But when investors liquidate companies will start cutting jobs due to the loss of income from stock market. The bay area has a lot of those companies. When jobs are cut, people start to foreclose on homes. When homes are foreclosed, the surrounding homes' value are lowered.

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What@Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 Your Question:  "is it legal and kosher? If so, what is it called?" It is simply Subject To or Sub 2 as some put it. Yes, it is perfectly legal. No, not everybody understands how to do them properly. No, I don't mentor ;-) I do however sell them ready to go as turnkey. You can do a search in the box above for Subject To here is a link 

https://www.biggerpockets.com/search?utf8=%E2%9C%9...

or, you can go to my profile and scroll down the lists of my posts and get a pretty good idea of how it works. Or, you can ask me whatever about Subject To, Wraps, Lease Options, Land Contracts, Seller Financing & regular financing (I once upon a time was a loan officer) and the Phoenix / Glendale / Mesa / Gilbert / Chandler market of AZ is a great place for doing these. I also do them in Texas but TX is a different state and has different markets like Austin, San Antonio, Dallas and Houston. It's just a different variant to use there, but very successfully done as well.

 I made my first million flipping properties in Seattle. We left there to find sanity. ;-) We looked at Santa Barbara, Newport Beach, Oceanside, & La Jolla before deciding we didn't like the traffic, the prices of properties and the taxes. I haven't lived in the Bay Area but I've spent a lot of time visiting relatives in Menlo Park & Palo Alto. Well, I did live for a short time in San Jose when it was orange groves, circa 1965 but my folks didn't like it there and moved us back to Seattle. Much later, when I was working in the computer industry I would be sent from Seattle to San Jose on a regular basis and I watched it grow into what it is today.

What I do is similar to assuming the loan, however no bank approval is required. It can be done in all 50 states, but I focus on AZ & TX at this point. My lowest cash flowing property using this technique, (the amount I get to keep) is about $600 per month after paying the mortgage.  Some go higher and I have one at about $1000 a month. I just picked up another two, one of which the underlying payment is $720 a month and I have someone who is about to sign for $21k down, which goes into my pocket, and $1650 a month, so it will cash flow for about $930 a month. The other is similar and will cash flow for about $1055. I have a couple of people competing for that one so I'll be getting about $25k down. That one is a "hoarder house" and it's taking them longer to clear everything out and move.

I am curious, are either of these properties rentals or are you counting on appreciation? Could you rent your primary residence out if your job situation or other personal factors forced a move and have cash-flow? 

Personally I haven't considered my primary residence an investment, probably because when I retire I will probably want a different type of home, but unless I move away I will likely spend as much on a replacement or more. What do others think?  

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.