All Forum Posts by: Romain Nguyen

Hi all, 

I'm researching the JT market and hoping to crowdsource some cost figures. I'm building a business-case and would like to make sure my assumptions are reasonable. I'm ideally looking for figures for a 3 bed / 2 bath single family home. 

• Utilities (e.g. water, electricity): is $300 / month a reasonable estimate? 
• Home insurance 
• Property tax: is 1.15% of the property's value an accurate order of magnitude? 
• Maintenance, small repairs, consumables 
• Internet: $100 / month? 

Thanks so much for your help, 

Romain

Hi guys, 

First of all, thanks a lot for the information - this is super helpful. I'm also monitoring the market, and I was curious to hear your opinion regarding what could be a conservative occupancy rate for an above average (but not exceptional) property in Joshua Tree. For example, a nicely designed single family home with 3 bed / 2 bath in Twentynine Palms with some desirable amenities (e.g. hot tub). Is it reasonable to expect a 50% average occupancy rate? Or would you say it could be higher? 

Thanks so much, 

Romain

Hi all, 

I hope you're safe and doing well. I wanted to ask if you had recommendations of lenders for refinancing in the bay area (Berkeley). I've done my due dil with search engines, but I was wondering if some smaller players could be more attractive and not necessarily visible on the web. 

Thanks so much, 

Romain 

Thanks a lot Kathy for having taken the time to answer ! Stay safe. 

Thanks a lot Kathy. Do you have a typical checklist of items that you ask your agent to go over ? For example, i) check and send a picture of the electrical panel, ii) gather info about the age of main features / appliances (e.g. roof, water heater, etc.), ...  

Hi all, 

As a new out of state investor looking to do buy and hold, I was wondering what you typically ask your agent to check and report on when visiting the property. For example: take photos of the property and neighborhood, search for major repairs to do in the house (e.g. electrical system), etc. 

Thanks a lot for your advice, and have a great weekend, 

Romain

Hi all, 

As a new investor, I was curious to know how you all assess how strong is the demand from tenants for rental in a given area. For example:

- Asking to property managers

- Checking on Zillow to see how many rental properties are vacant in the surroundings 

- Else: ... ? 

Thanks a lot for your answers, and have a great weekend, 

Romain

Thanks all ! Josh & Mike, I'll contact you via PM. 

Brian - thanks for flagging the event ! I found it on Meetup.  

Romain

Thanks Michael. Which liability limit did you put on your umbrella ? $1m or above ? 

From what I've seen, you're indeed at risk of veil piercing if you do not observe some basic principles with the LLC (e.g. need to file annual report and pay fees, not mix up personal vs. business funds, etc.). As long as you respect these rules, it seems a safe option but it seems that the LLC does not always provide the best outcome for an investor depending on the scenario. The examples in the article I pasted above were quite enlightening for me: 

Scenario 1: Umbrella insurance

The landlord owns a triplex worth $700,000. A tenant breaks their leg on the property. The tenant sues the landlord for $300,000.

LLC: The LLC has assets of $700,000. The LLC pays the full amount of $300,000.

Umbrella insurance policy ($10,000 deductible/$1,000,000 coverage): The dwelling insurance picks up the liability max. After that, the landlord personally pays $10,000 out of pocket for the deductible. The umbrella policy would pick up the remaining balance plus legal costs.

Result: The landlord would be better off with the umbrella insurance policy. With the LLC, the landlord would lose $300,000. However, with the umbrella policy, the landlord only loses $10,000.

Scenario 2: LLC

This unfortunate situation happened in Oakland, California. A landlord rented out a warehouse as an event and residential space. A fire ignited at the warehouse, killing 36 people. Prosecutors sued the owner and leaseholder for “negligently ignoring safety hazards.” Insurance paid out $3 million to the owner for the fire. However, 31 of the 36 victim’s families sued over the fire.

We don’t know yet how much the families will win. Let’s say they win $20 million.

LLC: The judgment is $20 million. The value of the warehouse is $3 million. The landlord loses the warehouse and insurance payout. The total monetary loss is $6 million.

Umbrella Insurance Policy ($10,000 deductible/$3,000,000 coverage): The landlord goes bankrupt, losing $20 million.

Result: The landlord is better off with an LLC, which shields them from personal bankruptcy.

Ultimately, landlords should make a decision based on their own real estate portfolio. An umbrella insurance policy is generally the better financial choice for most small portfolio holders.

Hi all, 

I'm based in Northern California and am looking to invest over the next months in the Indianapolis market. My goal is do buy and hold with single family residences located in B class neighborhoods to begin with. I've already done some due diligence on the market, although I'm sure I will learn a ton over the next months. 

I'd be interested in connecting with those of you who are active in that market if you are willing to chat over PM, do a quick phone call (10 - 15 mins) and I'm also more than happy to invite you for drinks if you live in the Bay Area like me. Examples of questions I have: 

- Type of properties you own and how you acquired them (e.g. Zillow, Redfin... vs. agents / wholesalers) 

- Feedback about your investments so far (e.g. what worked well / not so well) 

- Recommendations of property managers and agents 

Thanks all, and I'm looking forward to connecting with you and the BP community in general ! 

Romain