All Forum Posts by: Amit M.

biggest question: why?

It's hard enough investing out of area/out of state, but now out of continent?

You live in nor cal. I'd definitely look in your back yard first! It's quite depreciated and now turning around. San Francisco (where I invest) is on fire due to overall recovery and tech, and that will positively impact Sacramento too. Last thing I'd want to do is muck around overseas without tangible experience in specific markets.

I had a friend who "invested" in Baja, Mexico. Almost all the desirable areas, with 75 miles of the ocean, are land grants. ****, you can't even own it outright. With the recession Baja became a lead balloon. Imagine owning property you lost money on, and you don't even legally own it. Ouch.

I'm planning on living part time overseas in the future too. My plan: make my money in RE where I expertly know the markets. Then I can just buy a second home elsewhere.

hi Melvin,

Good call on buying in that cheap. Here are my thoughts:

1- I agree with j Martin that the long term appreciation for Vallejo has some headwinds. Remember, when we have another regional correction Vallejo will be one of the first areas to go down, and will go lower than more central Bay Area cities.

2- having said that, we are now in an upward market, and I personally think it has at least a couple of years growth ahead. I know SF and peninsula are on fire due to tech, so the outer areas are getting priced out buyers. So no reason to sell/dump now.

3- how much value can you get from that lot? How about subdividing and building on it yourself? What is the upside? If it's decent, that may be your first flip. And then maybe sell off both in a year? If so, I'd definitely do a 1031 exchange into another investment prop (or flip if you want to do those.)

4- If you sell/1031 Vallejo you will have sizeable cash. I'd consider buying in better markets closer in. Yes you will need 30% down to cashflow, but you will be insulated better in bad markets. And future appreciation will be more solid on the peninsula. You could consider upcoming hoods in Oakland too. But bottom line, if you can buy/hold on peninsula or Oakland, you can make real money on future appreciation. Having $300-400k cash puts you in a position to do that.

just curious, why the specific interest in medical bldgs? Did you work in that field?

Blackstone and other funds that brought discounted SFHs' en mass is one thing; Chinese 'buying up' Detroit is entirely different. 1- is that really true? (Source). Is it via organized funds, or just rich Chinese individuals speculating? If it's the latter, you can easily do the same thing- there are lots of dirt cheap props now in Detroit- have at it!

Now, if there is some concerted efforts by foreigners to buy up Detroit, that is interesting, but a huge gamble IMO. I still think much Detroit RE will be worthless 10 years from now. But probably core areas that are getting back on their feet could make a comeback. But I doubt that apply to the entire city- it's a huge place landmass wise.

Any Detroiters have opinions on this?

Although I don't study the Hawaii market specifically, I do know that it has similarities to the Manhattan and San Francisco markets, and I know the SF market well. What these markets all have in common is that they are highly desirable with blue chip status, have almost no new land (except infill/replacement development), and have a global client base.

SF has had an annualized growth rate of about 4.5% over the last 30 years or so; rest of the country I believe 1.5-2%, many areas even less. And that makes a HUGE difference in your appreciation as the years roll by. Of course the trick is, how to get in as even starter properties are expensive and the initial cash flow is usually not great, certainly not compared to other parts of the country. But if you can make it happen, be smart and find a creative way to do it, you will be gold 5-10 years from now. And once you get on the bandwagon, you can leverage your equity to get into another property.

Best suggestion for you: talk locally to investors in your areas of interest. Learn from their experiences. Go to the local RE clubs to find them. If I lived in Hawaii that's exactly what I'd be doing. Good luck.

@J. Martin

The duplex you were referring to will probably sell to an owner occupier or a flipper. It's hard to buy and hold in SF unless you: have a sizable down payment, can ferret out a good off market deal, or can find a clever value added play that will increase the income after development.

But other than that yeah, only an idiot would invest in San Francisco ;)

@Account Closed

I live and invest in San Francisco. I own 2 small buildings, one converted to condos, the other in process. I live comfortably off the income (av rent over $3200/unit.) I have a ton of equity, and will be making another purchase soon by leveraging part of that equity. I hardly spend any time on prop mgmt, as my tenants are stable and all professionals. It's a cinch.

Whenever I go to local RE clubs, there is a reason why so many out of state investors looking to raise capital frequently come to pitch their projects to us CA investors; all the money is here.

My suggestion: figure out a way to buy locally. Try to by 2-4 units where you can owner occupy. You get the best rates, are close to your tenants, and can learn the ins and out of landlording. Buy in a decent, upcoming area. Even consider a larger down payment (if you can) or take a reasonable negative cashflow you can support. You'll learn a lot, and if you choose a good area, will probably reap some nice equity over the next 2-4 years, which you can later tap into to help fund another purchase.

hey guys, it was great meeting you in person and hearing your stories! Thanks for setting it up j Martin.

A venue suggestion: if you can find a Large restaurant with a private room to reserve, that would be ideal. Can still order drinks and food, but be able to sit together and talk. Or maybe one of the DT hotels has a free option (in exchange for our drink/food business.) Also would be nice at the beginning for each person to introduce themselves and brief us on their markets/experience/what they are seeking. That way you can easily target your mingling.

Cheers :)

^ you don't know that. Maybe the guy drove too fast or wasn't paying attention when driving in the parking lot. If he was negligent, they are very lucky to only have been on the hook for $1 mil IMO. The girl lost her life after all.

both of those are great ideas- name tags and playing musical chairs :)