All Forum Posts by: Taylor Hawkins

House I want: 

I'm in Southern California buying a 3B/2ba SFH across the street from me. It has been unoccupied for decades and needs a lot of work. At 1400sq ft I'm budgeting 100-150k for remodeling. It has a huge lot and my city permits ADU up to 800sq/ft without too much fuss which I'd eventually plan to develop and rent. mortgage 7k/mo.

Current home:

I'm house hacking a 5b/2ba SFH with a 500k loan valued at 1.4M. Mortgage 3k/mo but it's paid by my tenants.

Cash I have: 

Cashing out everything (stocks on ETF) but 401k I’ll have 700k. With 20% down and remodeling expenses I’ll deplete that to around 350k.

Cash flow:

Worst case I’ll need ~10k/mo to keep both mortgages afloat. I could likely rent my home for 5K/mo and rent a bedroom in the new house for 1k/mo.

Given the uncertainty of repairs, landlording, and the macro environment what cash reserve would you feel comfortable with for this kind of leverage?

Hey there!

Looking for a creative ideas to create a win/win scenario for a close friend that wants to move in with me. I own a SFH and my friend would like to live in an ADU on the property. He currently pays ~30k/yr in rent and plans to stay for at least a year. He's interested in either using a studio-shed as a room with full house access or full on ADU with bathroom/kitchenette.

The obvious path forward is that I finance and build everything and charge reasonable rent likely less than what he's currently paying keeping the asset after to rent to someone else / use as an office / increase property value + sq ft. BUT that's the obvious choice and why I'm asking you brilliant professionals for creative ideas! :) 

Good idea Carlos! AirBnB tells me I could make ~4k/month which might change things. My girlfriend is a great/experienced property manager so I might look into that.

I've also heard people in my city make a lot of money as sober living homes, but I'm unsure of this business and there seems to be a lot of turmoil with the local government with that right now.

I appreciate all the ideas and help. Such a great  community!

Thanks everyone! I think the consensus is to sell and I tend to agree.

I said Vanguard because I haven't gotten my butt in gear and got my first rental deal yet. I have a lot of friends and family in the Vegas and Houston areas so I'll take this as encouragement and start looking in those markets. @Thomas Rutkowski I had never even considered private lending as an option. Thanks for getting my wheels turning!

For what it's worth, I can afford the new residence without the proceeds of selling out of the current one but want to make the best decision. I'd have enough cash reserves to weather a 3-6 really bad months.

The other option would be investing the cash from the sale into vanguard which has averaged 7% with no involvement at all.

I bought a 3bed/2ba 1k sq ft house in SoCal for 580k two years ago and through appreciation and some rehab (kitchen, landscaping) it's worth 700k.

I've decided to move a few minutes across town to a 1500sq ft for my family and got approved for a 20/80 loan buy it without selling my current house.

Should I sell or keep and rent it?

My mortgage is 2800/mo and I could rent it for 3100. That's only $300/mo NOT factoring expenses. Recent reports say Orange County is the 4th riskiest market with an 8% chance of homes going down in value over the next 2 years.

Am I crazy for considering renting it and not taking the appreciation now? Is there anything else I should be considering? I might be able to remodel the bathrooms or add a deck or something to flip for more appreciation (same floor plan flipped for 720k around the corner from me)