All Forum Posts by: Rodney Sums

I'll be the cynic here. People love and appreciate you until they don't.  If a roof fails they will want you to fix it and put them in a hotel.  Your Phoenix tenants will definitely want that when the AC goes out.  They won't care you didn't raise the rent And won't care you were nice to them.  We live in a society that loves litigation.  If at any time you're properties pave the way for a lawsuit don't bet the house they won't take advantage.  The likelihood of those events occurring may be slim but because they're possible you deserve to be compensated for taking that risk and having a reserve to cover the unexpected.   2 cents.

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@Jorge Ruiz for starters, you have any friends and family that live in cheaper areas?  You can start there so they can tell you about the areas.  Then you can browse listings to get a feel for what your money buys

@Qusay F.

Just out of curiosity and to clarify the last portion of your message, have you calculated that after all costs and reserves etc. you'd still make positive cash flow from day 1 if you buy it at the price you're offering?  Also, was your realtor able to get any indication why the seller won't negotiate the inspection addendum? (I'm going to assume the seller has or believes they can get offers without inspection contingencies)

@Jorge Ruiz

Do you absolutely have to stay in the LA area...or SoCal for that matter? If not...MOVE. You could potentially house hack a MFR as an owner occupant and have some change left over.

If you must remain in LA: I'll cosign what everybody else is saying, invest out of state where 15k is enough down payment for an investment property.  And you don't even have to go that far out, AZ and NV may should have properties in your price range.  

@Matt N.

Is there something extra spectacular about this property that you're willing to not only offer more money but take the risk of having no inspection contingency?  I understand it's a seller's market across the country in many places, particularly yours....but if you can afford to put 15% down on 400k to 600k why not shop with someone else and possibly somewhere else

@Joseph Hennis If I read correctly, it sounds like you are planning for retirement on rural acreage and these investments are to support that lifestyle...as I'm sure it'd be a challenge to do your job living rurally....in which case that makes you a cool dude because I want to do the same thing LOL.

I didn't do the "what would you do" portion of your question so here's mine, maybe we share a common goal:

sell property 5, so  I could have a new primary residence that I'll mention later

Sell property 1 (unless it is in a super exclusive area that's going to explode in value even more in the near future making it a keeper).  The amount of equity  in that property.. could make a down payment on a couple of multiplexes rather than own just the one property, eliminating 2 debts in the process

House hack. Using the aforementioned equity, acquire yet another multiplex and occupy a unit (much lower down payment and rent for owner-occupy) so I live for free/cheap s save for retirement on that acreage...and I can give retired parents a cheap unit to rent (helps them) and I have a timely and familiar tenant (helps me) and they're close by in their own space (helps everybody). Maybe that multi-unit constructed on the acreage if you really wanted and if that acreage is attractive to tourists, you could rent long term or airbnb those units. I'd avoid the mobile home, depreciates and becomes ineligible for financing after long enough....and they suck, they break down I've lived in a few. If I did my math right, you got 180k of equity sitting in a SFR, I'd put it to work. fun topic, nice portfolio Joeseph

Where is this at? And I only ask because I'm curious as to why someone who has a property that brings in 2400/month wants to let it go for only 80k.  

Is this place near you? Who will manage and market it?

Is it in a bad neighborhood and/or have high turnover tenants?

What's it going to cost you a month to own it including everything?

How is it a duplex with 4 units rented...is it a legal 4 plex or did someone get crafty and make it that way without permits?

Sounds like  you'd end up committing to an expense  inspection and appraisal (both will cost more than usual evaluating 4 units) to find out how bad the property is and have to walk away

Curious how this turns out, I'd like to learn with you as I want to buy a multiplex for my next investment.

Are your figures calculated from rent coming from 3 units since you're occupying one?

How old is the building?

How is it constructed? (wood/block etc..)

Owner pays everyone's utilities?

Property manager or self managed?

Any immediate repairs/updates needed and has that been factored in?

What quality neighborhood?

What size is each unit in sq ft and rooms/br?

Even as a novice i agree there isn't a "no brainer" number.  If it were, just like you said, the property wouldn't be sitting for 100 days and if it made so much money as reflected by a cap rate, the seller wouldn't be selling it or the price would go up to the point that well... the cap rate wouldn't be "no brainer" high