All Forum Posts by: Ricio Montes

@AJ Singh thank you for your valuable information! This really helps me see the picture and confirm some of my thoughts. I will definitely check with the city on this, and then my next big step will be to find a good contractor to work with! 

@Scott Scoville thank you for proving great information as it relates to RE! Will definitely think about this next investment a little more and hopefully we can stay in contact for future. Thanks again!

@Twana 

@Twana Rasoul thank you very much for your response! I will definitely do my research with the city to see about zoning etc. 

@Hamp Lee III thank you, Hamp! Appreciate this! I do have some family up in Bakersfield, so it may be good opportunity for STR.

@Dan H. thanks again for taking the time to explain all of this. I will do more research on the ADU keeping your points in mind. Sounds like it may be wise to hold on tight and see what happens with the market for now.

@Dan H. thank you for your valuable insight! These are all great points and things I should consider.

I suppose this ADU idea came to mind due to the current state of RE, especially here in California (prices/interest rates). Additionally, I had considered out of state but I have no experience and my understanding is that cash flows could be in ballpark of 200 to 400 (depending on various factors).

If I don't go the ADU route, not quite sure what direction I'd go in considering my cash flow future goals.

Thanks again for your help! Very good points made!

@Scott Johnson will do! 

@Scott Johnson thank you for your advice! I will reach out to the city and gather more info.

Hi everyone! My name is Ricio, and I'm a new member here. Looking for some RE investing advice. For context, I am 34 years old, and I purchased my first RE rental property in SOCAL, in 2011 (it is my only property). The loan amount for that property is currently at $140k with a 4.5 interest rate, and based on online comps, looks like home value is around $600k.

I have about $280k saved for investing (combination of money market accounts, stocks). What I would like to do if the city permits it, is build a detached ADU, and a garage ADU on the same property. The detached ADU would be 2 bed/1 bath, and garage ADU a studio. I'm wondering if this is a good idea considering city permits/building costs etc (this is all new to me). The lot size is approximately 7000 sq ft and the home currently there is about 1000 sq ft, so having two homes of approx. 1000 sq ft and the garage ADU is how I envision things.

As far as financing, I am considering using a HELOC/LOC for the project, and keeping my money as reserves. If it all goes how I am thinking, I would be cash flowing nicely. My main goal as a RE investor is cash flow, and my goal is to be able to reach 10k in monthly cash flows (over time of course).

Could you please advise if this would be a good idea, or if there are better options such as investing out of California. 

Your advice and help are appreciated. Thank you!