All Forum Posts by: Ryan B.

Hi there.

I am still a newer investor when it comes to the note space, but I have come across a situation where I am curious to get input from more seasoned investors. Do you ever consider the location of the property and the potential ability to sell the asset if you ever need to foreclose when considering a performing note? I know the answer probably is yes in many instances, but here is a broad example of a note that I am looking at: 

-Performing 1st with no missed payments over the past 15 years

-Equity in the house - less than 60% LTV

-Property is in rural WY

The note has been performing well for a long time and I view the chance of default as fairly low........however, if I ever had to foreclose on the property in the future, I am worried about the ability to sell the property (either through auction or on my own) might be difficult. I looked at some comps in the surrounding area and the sales volume is really low, like no sales of any homes in the past year and a half in that city.

So would you feel comfortable about buying a stable note, knowing that if you ever had to foreclose it might take years to get out from under the property. Or am I looking at this wrong?

@Wes Blackwell , thank you for telling me why I moved, even though you are flat out wrong.

Originally posted by @Wes Blackwell:

@Ryan B.

The reason Stockton was never on your radar and never would be was because you ended up purchasing in an area where the median home price is three times Stockton's (Walnut Creek = $877k, Stockton = $270k).

I didn't buy in Walnut Creek, we rent. I can't afford a $900k house here. My wife and I chose to rent in Walnut Creek vs. moving further away, where affordability is better, because we both work in SF and Oakland.  Proximity to the city is an important issue. Like I said, I would never consider moving to Stockton because its too far away to still work in the Bay Area (not because of median home prices like you are insisting).  We would rather rent and work/live close to the city than buy and move out of the bay area. You started this post because your theory is that 30 somethings living in the city will move out when starting a family, and that they will move to Stockton for affordability. As someone who was in this exact situation, and knows many friends in the exact situation, I am telling you it simply isn't true. No one wants to move to Stockton, because as @Matt K. mentions, the commute would be 1.5+ hours each way.

It sounds like you are pivoting to lower wage earners being the influx of demand for Stockton, which could very well be the case. However, it started out as Stockton being the next big thing due to SF transplants. I just don't see that happening.

Hi,

I just got my first offer approved on a duplex in Indianapolis. Does anyone have a property manager they would recommend?  Also, I am debating between two banks willing to finance the deal, Huntington Bank and Fifth Third. Anyone have any positive or negative experience with either.

Thanks,

Ryan

My wife and I were in the exact situation two years ago. We lived in downtown SF and had a kid on the way. We had to move out of the city for space and to someplace more kid friendly. We moved to Walnut Creek. Stockton never was on our radar and quite frankly never would be. If you move from SF to Stockton, you are essentially agreeing to move out of the bay area b/c of the distance, and the whole reason we chose to live in the area is to experience the things that come with living close to the city. The distance to Stockton is too far. The commute is too long to still work in the city, and if you do choose to brave it, the commuting costs and time spent commuting eat up all the potential savings anyways.  I have a lot of friends in the same situation, and they all chose places like Walnut Creek, Pleasant Hill, Vallejo, Emeryville, Pleasanton, or San Rafael. I am not saying that Stockton won't be a great place to invest over the next decade, but don't expect to move there and still work in San Francisco. Unless you telecommute, but then you could really live anywhere you wanted and why limit yourself to CA.

Thanks for the responses. My property manager is doing a decent job of handing the situation and it turns out to not be as bad as originally thought. Most likely the tenant will not need to be relocated and my insurance covers mold removal and lost rent up to a certain threshold. A lot of cleaning and repairs will still need to be done, but I don't think I have to replace my entire kitchen.

Hello all,

So I am in a bit of a pickle and curious to see if any other landlords have experienced a similar issue and what sort of course of action they would recommend. I own a SFR out of state with a business partner who also lives out of state, and we use a property management company to manage the rental. We got an email from the PM saying the tenant reported seeing mold on the kitchen wall. We authorized a mold inspector which found a large leak behind the dishwasher. The damage is pretty bad with near by cabinets, floor boards under the kitchen tiles, and drywall on the siding of the house all being soaked with water and need to be replaced. The inspector is recommending a complete kitchen demolition and possible tenant relocation.

My question is, have any of you guys had a similar experience, and/or had to relocate tenants? What should i be worried about in terms of liability, and should I be taking any more steps beyond authorizing the mold removal and cleanup? What would experienced landlords recommend in my situation.  The lease ends at the end of June with the tenant notifying us that they intent to move at that time and my business partner and I were planning on selling the house during the summer once the tenant leaves.

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Does anyone have experience selling their out of state rental properties?  I own a rental property out of state with my business partner and need to sell it once the current tenant's lease is up. I live in CA and the property is in OR. The property is currently rented through April and we use an external company for managing the rental. My business partner needs the cash, so we are planning to put it on the market once the tenant's lease is up. So my questions for any long time out of state rental owners, who have sold some of their properties are:

-How do you manage the process from out of state?

-Do you list the property before the tenant moves out?

-How do you coordinate any repairs or upgrades that need to be made before it can be sold?

-Do you list the properties in rental shape or put in some money to attract traditional buyers?

-If you use an agent, what sort of help will the agent traditionally provide beyond just listing the property? 

-Any other tips or advice you can think of?