All Forum Posts by: Ricardo Cristobal

If you make the plunge to OOS investing, be sure to look for "recession proof" markets. The markets that have good job diversity, growing economies, affordable rent to income ratios and have not seen a massive run up over the past several years. You may also consider a more passive approach or partnering if you have others in different areas that you can trust. 

I live in LA. I like to rehab in LA or do more of appreciation plays if I can get a smaller bar to entry for holding. For cash flow I generally look out of state. 

@Ricardo Cristobal SoCal can be a tough nut to crack for newbies.

A couple years ago I mailed out lots of letters to homeowners in LA County with no luck.

Then I tried rural Kern County and got a deal from a distressed homeowner in California City.

The margins were not as large as they would've been in LA or OC, but I was able to rent it out for 2 years before fixing it up and selling it for a decent gain.

Also, have you considered an owner-occupied small multifamily for your first deal?

You only need to put 3.5% down, so cashwise it won't get in the way of other real estate goals you may have.

My first deal was a 4-unit up I bought with FHA 3.5% in Santa Clarita.

I lived for free (as opposed to paying rent) + enjoyed cash flow + built equity. It was a great investment (and still is).

Good luck!

@Ricardo Cristobal

Maybe depends how long term you are thinking your hold is going to be. Historically the longer term would favor Cali generally ( major cities). You also may have some advantages for Vegas being in Apple Valley as far as out of state goes. Good luck with your search! 

Ricardo Cristobal I was living in seattle a similar primary market where the rent to value ratio a don’t make sense. I would say go out of state but beware things barely cashflow these days. Make sure you buy things that rent for at least 900 a month.

@Ricardo Cristobal

Hi Ricardo, It depends on your risk tolerance and your ability to manage from afar. When I say manage I don't necessarily mean managing the property yourself, but you could hire a management company, you could put a team of people together to assist you with investing (agent, contractor etc). Alternatively, you could work with other investors who are looking for funding (ie Memphis invest), they don't require you to put 100k+ down to invest, or JV with someone who has more experience and knowledge than you.

The options are pretty endless as I am sure you have been exposed to just reading through the numerous forums. The concept of reasonable is really on the individual, because your reasonable may be $500,000 vs someone in the midwest reasonable may be $100,000, so you have to find whats comfortable for you, do your hw and take action. 

Good Luck

@Ricardo Cristobal Thanks Man. I wish it was feasible, but my wife's and my job are here. I don't think we want a crazy commute. You're right though, the prices are so high that most properties that I'm looking at wouldn't cash flow once I move out. That's the main reason why I keep debating if I should keep renting here and invest in Arizona. Out there you can find a fourplex for 250k, not in amazing shape but decent.

Who am I:

Hello, Everyone! My name is Roman Cervantes. I grew up in Arizona and attended Arizona State University where I received a Masters Degree in Architecture. Upon graduation in 2015, my wife and I packed up our belonging and made our way West searching for that ocean breeze and ended up in Los Angeles.

Experience:

I made a great friend that recently introduced me to bigger pockets, and I've been hooked since. I guess part of the reason why I decided to pursue architecture is that my father worked in construction for many years and this line of work was something I felt familiar with. Growing up, I helped my parents with their house flipping and rentals, so I've witnessed what REI can do, I just hate that it took so long for the light bulb to go off.

Current State:

I am looking forward to gaining as much understanding as books can give me, but mostly eager to acquire our first property and learn while doing. My wife and I just started talking to lenders and realtors as well as driving all over the neighborhoods to understand the areas and market. Our plan is to find a duplex at a decent price so we can House Hack,  preferably a property with the potential to add value and resell in the future. If we cannot find something that makes sense, we are open to other options, possibly flipping a house or apartment.

The Goal:

My short term goal is to find a duplex in Los Angeles to House Hack. Long term goal is to acquire multifamily properties in Phoenix Arizona and hold as rental properties. I plan on having 5 units by year one. There is so much to learn and I'm not sure how it's all going to happen, but I know I will achieve it and I look forward to learning from all of you. 

If anyone is looking for an extra hand and you're in the Los Angeles area, I would be more than happy to help. Finally, I would love to hear your thoughts on Los Angeles vs Phoenix Arizona. House Hacking would potentially cut my rent payment in half, netting me about 1200 a month vs finding a triplex or fourplex in Arizona that would cash flow 600-800.

Thanks for reading!