All Forum Posts by: Account Closed

From your comments it sounds like you have no prior real estate investing experience, your share of the profits are actually $300K and that you plan to stay in the Bay Area for several more years at least.  Residential real estate nationally has just experienced a 20-25% price increase in the last year and supply is still very limited.  Mortgage rates have increased, although they are still near historic lows.  So, not a great time to buy real estate, let alone investment property anywhere.   In the Bay Area specifically, you need very high equity to make a property cash flow at all.  Most of your gain will be from appreciation.  That said, you need a place to live.  IF you can find a property that works for a house hack, and $300K is enough for a down payment, at least you could reduce your cost of living and ride the appreciation while you live in the property.   

Annchen, thank you for compiling and sharing your research on LVP!   We installed CoreTec plus in our own kitchen and adjoining family room and have been very happy with it.  It replaced tile and carpet.  CoreTec was recommended by the flooring company we used.  Before installation they applied some material to smooth out any leveling imperfections.   

@Mike Nuss   Thanks for going to bat with Chloe Eudaly et al.!   

@Louie Pullen

"Think it really depends who you ask. I was told to limit it to 10% by a couple different advisors. The die-hard, low cost index fund people also tend to shy away from a lot of real estate exposure unless you are talking REITs."

In my experience, when you talk to the typical financial advisor, the only real estate investments they are familiar with are REITs.  They generally are just not that educated in direct real estate investment.  

Not surprising that most folks here are heavily invested in real estate.  For many years, we were all about putting as much money as we could into retirement accounts and investing in stocks and stock funds.  Over the last 10 years, that has changed dramatically.  Our current asset allocation, net of any debt, is about 77% real estate -- 60% in SFRs including our home and 40% income producing private equity investments.  The rest is about evenly divided between stock funds and cash.  

As far as financial advisors go, I'm reminded of this saying:  when your only tool is a hammer, everything looks like a nail.  The  same goes with most books on investing.   

I think these latest proposals from Chloe Eudaly, on top of those that have already been passed, are not only punitive but counterproductive.  If they pass, I predict many landlords, especially those with one or a handful of units, will get out of the rental business.  Developers considering new projects will decide to build elsewhere.  And then what happens to supply?  Meanwhile, I don't think any of this is doing a damn thing about the homeless problem in Portland. 

When my wife and I met 10 years ago, we both had our own houses purchased before the real estate meltdown. One was purchased in 2006 at the peak of the previous market. We kept those as rentals and bought a fixer to live in in 2010. It was bank owned and we were able to pay cash. We kept that one as a rental and bought our current house in 2013. It's big for just the two of us but the monthly payment (PITI) is only $2000, which is less than what our last house currently rents for. Our equity is probably about 40% of the total value. Having owned houses before the last real estate meltdown and living through property values declining by 35-40%, I'd be cautious if you buy. Don't over leverage. Real estate is probably close to the top of the current cycle. It may not crash as bad as the last time but it won't keep appreciating at the current rate. If you plan on moving in less than 5 years, unless you can keep the property as a cash flowing rental, you might be better off just to rent. It costs money to sell a house, and if the market is soft it might take awhile for it to sell. Meanwhile, you still have to pay the mortgage.

I have spoken with Bill Lamberth of Eagle Property Management. He seems to have a reputable company. PMs in this area generally charge 9-10% of monthly rent plus some % of the first month's rent. http://eaglepropertymanagementco.com/  

Hi Jesse, 

Please add me to your mailing list.  Thank you!

Pat

@Jesse Rivera  I'm sorry I missed this. Please add me to the contact list for the next one!