All Forum Posts by: Osazee Edebiri

Quote from @Rajesh Patel:

I had a section 8 tenant. This tenant left but illegally subleased the apartment to someone else. Section 8 refuses to do anything. We never got possession of the unit. Can we hold section 8 accountable? Would you be able to recommend any attorney in Bay Area focusing on Oakland CA?

 Sorry This happened to you. The two attorneys I would suggest you reach out to for Oakland:

The Law Offices of Alan J. Horwitz

and

Bornstein Law.

Best of luck, keep us posted how it is going.

Quote from @Jesus Santoyo:

Quote from @Dan Nelson:

While opinions on the "better" real estate market varies based on your preferences and investment goals, I think their are many markets that make more sense than SoCal.  For example Chicago - the market I am in -has more affordability compared to many areas in Southern California. The city's lower cost of living and real estate prices can provide investors with more accessible entry points and potentially better cash flow opportunities. The economy is extremely stable with diverse industries like finance, technology, and manufacturing and Unitrd Airlines and McDonalds.  SoCal has historical property appreciation and high demand for housing but much tougher laws and zero chance for cashflow.

 Chicago tends to offer affordability, geographical diversification, and potentially better cash flow opportunities due to its lower cost of living and real estate prices and rent control is illegal in Illinois. 

I am focusing on Chicago because it is the area I represent and know the best but I prefer the fact that it has both cashflow potential and future appreciate at a much lower starting price.

 Man, as someone new to investing- started in 2021

my first property was a 3 unit househack - I pretty much live for free the second one that I purchased was out of state in the Warren, MI area is a great cashflow property but knowing what I know I would have used the 20% and done another househack after the first year instead of rushing out of state. I will advise you to househack at least one time and use that money and time you have to define the market you want to invest. 

Completely agree, whether it’s California’s LA, Bay Area or San Diego, Tahoe (people forgot the state is huge and has cheaper markets within it),or Miami, Seattle, etc. Househacking allows you to use lower capital to invest in more expensive markets thus allowing you to access higher appreciation homes. Let’s add live in an expensive market that most people would rather live in, if not for cost, for cheaper too. 

Connections and deals are like anything else they take work and effort.

When you build a real connection there won’t be any desperation. 

When you talk to people on here,@Peter Dukaj, search for mutual alinement, when you see it lean into it. Also, don’t assume the connection you make has to turn into something immediately. It can be a year or five years later, which is why being on the same wavelength plays a critical role.

I was in Starbucks and I guy I talked to on here happened to run into each other. He mentioned how some of the discussions we had in the past really helped him on his investment journey. He was in a hurry to catch his flight, but before he left he dropped a $50 Starbucks giftcard on my table. How cool was that! More importantly than the actual gift, was the boost to my mentality to keep pushing forward connecting.

Quote from @Abe Rouz:

Hi 

Im starting to consider house hacking in the Bay Area. Ideally i like to avoid San Francisco, Oakland and Berkeley given the changes in landlord laws. I have been primarily looking at househacking duplex and fourplex around the east bay. Any perspective, advice to get started would do wonders. I am currently a physician assistant and looking to stay local to my job sites. Thank you! 

 Hey Abe, 

Congratz on getting started on your investing journey. I house hack in San Jose and own property in Oakland. I have been house hacking since before I knew the term, 2015. I would say you say my advice would cater to what specific East Bay cites you are qualified to purchase in and your price points. Also what your out of pocket goals are etc. As we know the cites will very drastically, some east bay cities don't even have very many small multifamily vs some that have more, so that will help the direction of your decision. Based on what you wrote so far, my initial advice is don't overthink it, house hack offers a lot flexibility and at the end of the day if you are renting, get a primary home that generates income is win. It's really up hill from there. 

Let me know what additional questions you have. 

Welcome to BP @Austin Dias !

I think you are getting a lot of good info from this post. What I would say is that you and your wife have a good amount of savings to get started in the Central Valley. I would recommend taking to sometime to figure out what strategy you want to pick to help you focus on your next steps.

House Hack (I know you mentioned you love your current home, but this is a great option finance wise), Live in Flip, Regular Flip, Small multi, etc. Each will have pros and cons, so it's about figuring out which one best alines with your values and goals. 

Hope this helps.

Good luck, Keep us posted and let me know if you have any additional questions.

Quote from @Doug Quist:

Quote from @Osazee Edebiri:

Quote from @Doug Quist:

My old house went from $4M to $5M in the three years since we moved, but my portfolio that I purchased with the net proceeds has done WAY better both due to better appreciation coupled with leverage and it is cash flowing as well.

Wait your OOS portfolio has performed better than one South Bay Area house that appreciated 1 million dollars in 3 years?

Wild statement. 

I feel like that seems to justify buying a property in the Bay. Many people knock buying in California, but when we go through these forums I hear so many people say they used proceeds from selling property to create solid performing portfolios in other states. 

We bought a $1.75M house in the South Bay in 2008. Did a massive remodel that added 800 sq ft in 2016 which cost approx. $750k and then sold it for $3.9M Zillow says it is now worth about $4.9M. That was great, but VERY expensive to "get in". Of course, we started with our original house in 1995 at $500k, traded up a few years later, traded up a few years after that before we got the final house. The CA has was 25% LTV, so not much leverage.

Took the cash out, after taxes, from the last house and purchased four fourplexes, a duplex, three condos (sold after owning for 15 months), two single family homes (SFH), a newly built SFH (flipped from the builder in 28 days) and a building lot (sold after 2 years). Other than the flip all the purchases were at 75% LTV with 2-3% 30 year fixed loans. Actually, the condos and duplex were zero cash invested, until the HELOC was paid off with the CA sale. That portfolio is now approx. 40% LTV due to appreciation plus amortization.

Utah has been on fire both for appreciation and rent increases.  I know that David Greene doesn't totally agree with this, but cash-flow plus conservative leverage is the ticket. Appreciation doesn't feed my kids or grandkids. :-)

I had to do one eviction (condo) and that took 2 weeks.  Try to do that in CA.

 Hey Doug,

It's clear you have awesome results, but you seem to mention cash flow is more important than appreciation, but you didn't mention any of your cashflow numbers. From reading what you purchased, you used the appreciation gained from your CA property to buy all the OOS properties. The picture you are painting, again just by what you wrote is that the cashflow you are currently receiving is icing on the cake. Yes, I agree with you about leverage, but that leverage was possible because your properties apreciated.

Quote from @Doug Quist:

Not quite sure why @Carlos Ptriawan feels that a landlord for multi-family is more of a headache than being a landlord for a single family.  I have six fourplexes, a duplex and a single family.  The single family has been more hassle for me.

I was in the South Bay for over 20 years and we made bank on our primary residence.  I moved to be closer to my parents as their health has deteriorated, so sold the house and deployed those funds plus others both out-of-state and also in my new state.

My old house went from $4M to $5M in the three years since we moved, but my portfolio that I purchased with the net proceeds has done WAY better both due to better appreciation coupled with leverage and it is cash flowing as well.

I'm struggling to find good cash flow, due to interest rates, even in Arizona, Idaho and Utah.  Sharpen your pencil and be a good detective.  For me, a house hack is not in the cards due to SWMBO, but I'd do it if I could.

 Wait your OOS portfolio has performed better than one South Bay Area house that appreciated 1 million dollars in 3 years?

Wild statement. 

I feel like that seems to justify buying a property in the Bay. Many people knock buying in California, but when we go through these forums I hear so many people say they used proceeds from selling property to create solid performing portfolios in other states. 

Quote from @Wang Windy:

Hi biggerpockets friends,

It's my first post on the forum and I would like to get some help on starting my first investment property. I have around 250-320k cash to invest.

I live in the South Bay where houses are extremely expensive and difficult to find cash flow. However, I don't really want to invest in a property that I have to pour a lot of money into every month. 

Option 1: After researching, I found the only place that has the potential to cashflow is in the Oakland area. However, I've heard so many horror stories about the area that I am still a little hesitant to buy there.

Option 2: house hacking in San Jose, but even then I probably still gonna have some negative cash flow. Maybe a mid-term rental will provide me with better CF? Would love your insight on this.

Option 3: Out of the Bay, potentially looking into Salt Lake City, UT, Fresno, CA, or Savannah Georgia. 

I am young and I have a lot of free time. What do you think is my best strategy?

 Hi Wendy,

I am in both San Jose and Oakland. 

I would say Oakland and SF (add Berkeley) can be the most challenging markets because of rules, but many investors are successful.

Your 3 options you presented could be looked at in many different ways, therefore you have determine which is best for you. If cashflow is your primary goal, then out of state is likely best, but you need to manage and deal with the issues that can arise from managing from afar. 

If you want a balance of rent and appreciation, Oakland could be that option but you have to find the right property and location, which is very difficult. 

If you don't own a primary home, based on the amount of capital you mentioned, owning a home in the south would be lucrative in the future regardless of income generated from House Hacking or not. A midterm rental will provide you better income, you may still not cashflow depending on your setup. However, house hacking is not about cashflow, it's about of setting your mortgage and not paying rent, with the added benefit of future returns, which is why if you have the capacity to do one a year, it gets multiplicatively good. 

SFH appreciate more than small multis. So keep that in mind when you decide what to do.

Depending on your income or your finance options you could also house hack and still buy out of state properties. So there's that option too.

Quote from @Trevor Richardson:

California investors should really check out Reno before heading east. It’s closer to you, is a very stable market and right now has great deals for multifamily. 

Real estate taxes don’t reassess on the sale, insurance is low and we continue to have increased in migration, jobs (no state income tax) and our own land constraint issues which prevent the market from getting overbuilt.

 I think Reno can be a good market. Although if I were to think landlocked Reno vs Bay Area cities it would not have crossed my mind I am curious about this. What are the land constraint issues which prevent the Reno from being overbuilt? 

I have been snowboarding for years, have seen the growth of city over years and always felt like expansion was very open. 

Quote from @Frank Tillman:

Greetings, 

First post and excited about networking and learning more about acquiring multi-unit properties in the Bay Area! Prior to nursing, I worked in Marketing.  Ready to learn more about the Bay Area market and not afraid to get my hands dirty.  

50 percent complete with Allied California Real estate prerequisites and still not sure if I should obtain a Real Estate license vs work as an investor?  

Only have one property and just completed my first rehab. 

Is anyone familiar with real estate networking events in the Bay Area? 

 Hey Frank, welcome to the Bay and Congratz on completing your first rehab. If your purposes of getting your RE license were educative, I would say just focus more on studying or "working as investor" as you said. If you considered getting your license to make additional income then definitely as long as you believe you have the bandwidth to be both a nurse and an agent. I have seen many people get their license and not even do a single transaction because they truly did not realize how much work and effort it would be, lets even add especially in the current market we are in. So I would first take the time to focus on what your goals are and maybe work on order of importance then go from there. 

Good luck, keep us posted on how it's going and feel free to reach out to me if you have any questions.