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All Forum Posts by: Ori Skloot

Ori Skloot has started 34 posts and replied 229 times.

Post: Would you be a mentor? - Bay Area

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

Allan good question.  I get approached a fair amount from people wanting to go grab a coffee (they will happily treat me to the coffee) and to pick my brains.  Or people looking for a mentor and asking me what they could do.  I think @Brandon Turner covered this a few times on the podcast - if you want to find a mentor then bring value to the table.  Offer money, to drive for dollars and look for deals, make phone calls, pour concrete, massages....something in exchange for being mentored 

Post: Selling Oakland 4-plex right now - good/bad market?

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

I like @Hayden H. advice. Sounds like a reasonable strategy. The downside is I think it may take some time for remote to start picking up again, so it depends on your time frame. I think the market for a 4-plex in your area is still strong and that you will get a good price (if you do go to market, definitely leave the two units vacant and let the new landlord pick the tenants). It also depends on what you want to do with your proceeds once you sell. If the plan is to house hack into a better neighborhood/ property or purchase other investment properties with higher ROI, then it could be a good time to sell

Post: Vallejo or Richmond?

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

I own SFD and MFD in Richmond.  Like @Jay Hinrichs I've been saying for years that Richmond is a great play.  One of the last affordable Bay Area Cities that has a Bart station.  And as @Steve Hodgdon mentioned, now there is a Richmond ferry and a building department that wants to see more housing development.  On the downside, the city has way to many city programs that landlords pay for: rent board, housing inspection program, business license, fire and safety program, to name the ones I can think of off the top of my head.  So when running your numbers make sure that you include the cost of all those things because they really add up.  

I know Jay is grabbing up land to develop in Richmond (have you started building on any of those lots Jay?), but there are also good small multi-family deals to be found on the MLS. Yes, there is city rent control in Richmond. There is a domino effect of all these Bay Area cities implementing rent control, I imagine that Vallejo will be up next. So, my vote for what it's worth is to buy in Richmond.

Post: When is it appropriate to bring up seller financing?

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

Similar to @Reece Iovine I like to make a cash offer and I always mention that I may be able to do better if they want to help at all with the financing. Sometimes I send a letter of interest and I give them three offers: all-cash, traditional financing, seller-financing.  The offer steers them to the option that is most ideal for me. 

Post: When to Refinance and Goal

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

I'm with @Brian Garlington on this one.  No one is going to want to accept an offer contingent on a refinance of another property.  Way to much risk.

Post: Need replacement buyer for a duplex in San Francisco

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

@Wendy W. I'm not as familiar with the SF market, so I'll assume that your broker is accurate with the $1.7M valuation.  If that is the case and the price really is $150k below market, I would think your broker would be able to send the deal around his/her office and contact other colleagues to find another buyer.  Maybe you could even pick up a wholesale fee?  There are plenty of people looking to park their money and a vacant duplex in a prime area of SF should be pretty desirable.

Post: Path to take next? Unlock equity or continue with appreciation

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

David, IMHO I would hold tight and weather the Covid storm.  Right now lenders are super conservative on cash-out refinances.  Wells Fargo isn’t even offering them.  I agree that prices may dip in the next 6 months but I don’t think in such a significant way as to impact your ability to refi.  Lenders will come back around to offering cash out refi without high points at a reasonable rate.  At that time you should try again and pull out cash that you can then reinvest.  Congrats on having made a great purchase at such a young age. 

Post: Current Rent Control

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

Rent control laws are either governed by the state if there is no local rent control or by your city or county.  The local rent control would be more stringent so the first question is whether that is in place.   That can easily be found with an online search eg: “El Centro Rent Control”

Post: What issues can be caused by a bonus unit?

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303

I just recently dealt with this scenario on a recent purchase.  4-plex with an illegal 5th unit at the bottom of the building.  Things to watch out for:

1. Appraisal - make sure that the 5th unit does not display as a unit. Pull out the stove and maybe the fridge.   Technically, the fifth unit on the place I was buying was a storage area.   
2. I would underwrite it as a 4-plex and if you choose to rent out the fifth unit that’s icing on the cake. 
3. Renting out the fifth unit is a risk (one that many owners take quiet often but don’t think about the implications).  You are exposing yourself to a tenant that could report you to the city, if there is an injury in the fifth unit you have exposure, and if the lender found out it could be an issue.  Again, still might be worth it to rent it out, but be aware and try to mitigate the risk.  

Post: Deal analysis / overcoming fear of project

Ori Skloot
Pro Member
Posted
  • Investor
  • Berkeley, CA
  • Posts 242
  • Votes 303
Originally posted by @Bart White:

@Ori Skloot

Ori, thank you so, SOOOO much for reaching out with an offer of help!

You were so kind and patient with me when I was at a high point of excitement and nerves.

Due very much to your advice (and calming me down) my partner and I are on the verge of being in contract for the property (pending lawyer approval).

I CANNOT properly thank you now but perhaps some day soon.

I look forward to the possibility of our paths crossing again soon.

Bart

Bart, you are most very welcome. I wish you the best of luck with your first investment property. Getting your offer accepted is probably the biggest hurdle, but there are plenty of hurdles, twists and turns moving forward. Make sure to do proper due diligence (get a home inspection report, termite report, roof report) and get a clear idea of what the costs will be to make repairs to achieve a realistic ARV (after repair value). I think you've got a diamond in the rough on this one, so move forward both cautiously and confidently