All Forum Posts by: Ray Lim

Thanks John, So I took your advice and am looking at places in Las Vegas, Nevada and I do see a lot of 10+ cap deals. However I am concerned with out of state property management. I have heard horror stories of property management taking advantage of out of state owners.

Can someone point me to good resources on managing out of state properties? Like how to screen for good property management? Or what are other good options for managing out of state properties?

Okay, thanks.

@ Jon, what would you consider a good measurement for good cashflow? 10+% COC? Also, how good is the 1% rule? I remember reading that it is a very conservative number.

@Steve, in what areas do you find these double cap rates? I would like some examples to look at. Are there any publicly listed online right now can you may be able to point me to? Or are they difficult to find.

The property is one of the first properties I found on one of those real estate search sites. It was interesting to me because it already did the pro forma numbers with a positive cash flow. So I was wondering if there was anything suspicious about the numbers.

@Charles, just for future reference, what numbers should I expect for repair reserves? And how much should I expect property management in Seattle area to charge? The 10% of gross income like resources said?

@Brian, is 100k per door really too high for Seattle area? I guess I should look at comparables.

I noticed that the prices for properties in Seattle/Bellevue/Redmond area are higher than properties in places like Nevada. I honestly think it is difficult for me to look for a deal here because of the higher costs. Especially with traditional lending. Are there any other areas near the area that have lower prices but still a good location?

I found this market flyer for this property

It is a 8-unit multi-family property being sold at $800,000.

The market flyer seems to do the basic number crunching already. It calculated a CAP of 6%. It also already calculates the mortgage payment at LTV of 80% and shows a positive cashflow.

I am considering buying this b/c of the location. It is located in the U District near University of Washington.

However, I'm new to investing so I do not know if this is worth the price. The first link shows that it was built in 1906 which is over a hundred years old. Are there going to be large problems w/ the property in the future?

2nd, the cashflow calculated is $9118.
With a $160k downpayment that is only a COC of 5%
According to one source because the return is not that great compared to stocks, I should not consider this investment.

However below cashflow it adds a principle reduction of $6700 adding to a total return before taxes of $15.8k

What is this principle reduction? should I even consider it?

Please give me some advice or next steps in looking at this property.

Wow. $400/mo cashflow. I hope I can find deals like that. From the book I read, I got the impression that even $200/mo cashflow was difficult to obtain.

Thanks for the advice. Because I have a lot of free time right now, I am trying to do as much reading as I can before I start work.

I just finished reading The Millionaire Real Estate Investor by Gary Keller. I think (with my limited knowledge) that it is a book with sound advice. http://www.amazon.com/Millionaire-Real-Estate-Investor/dp/0071446370

@Realtyman, what do you mean 4 4-plexes? Do you mean the money you paid for one rental you could have split up and bought "four different 4-plexes"?

I am not sure what I should do/read next. I eventually want to read a book on landlording. But I feel like I should look for more information on market analysis and finding deals. Does anyone have any recommendations?

A friend of mine suggested that I read up on asset protection instead.

Thanks everybody for the greetings.
I am looking forward to meeting everyone.
I'll be for sure to contact you after I settle down a bit in Seattle.

Thanks Realtyman for the advice. MHP sounds kind of exotic to me right now. But that's because I'm uninformed. Maybe after looking around the site I may get interested in it.

I have considered starting out by buying and holding single family homes because that sounds the most traditional and straight forward. So hopefully it is the easiest market to get started in for a newcomer.

Thanks for the greetings again,
Ray

Greetings from a recent graduate from UCLA. I am going to be working soon and I am planning to invest in real estate. That means putting a side of my paycheck every month for investing. My goal is to build financial wealth. Enough so I can do my own things without worrying about money - such as teaching, starting a business, or simply just spending more time with family.

A little about my experience with RE. I have no knowledge in real estate investing. But I have started reading a book on real estate investing. There is so much information out there that I don't know which ones are reliable and trustworthy. Especially after visiting John T. Reed's website (http://johntreed.com/Reedgururating.html).

So what I am looking for here is guidance - a light of truth through the fog of marketing and bad advice.

Currently I am still in Los Angeles, CA, but I will be moving to Seattle, Washington in a few months. What I am hoping to do is hopefully find and network with real estate investors who are willing to share their knowledge and expertise.

If you are in Washington I would gladly appreciate it if we can network over a cup of coffee.

Any for everyone, I wish good luck in their endeavors.

Thanks,

Ray