All Forum Posts by: Tom Goodwin

Hi Everyone,

We are looking at potentially buying a house in San Jose. The house currently has a detached 1/1 ADU, around maybe 400 sq feet, which we are pretty sure wasn't permitted.

If we bought the house, I think we would like to extend the bedroom/bathroom out a decent amount. The original owner definitely prioritized the main loving space size over the bedroom/bathroom.

I have read through the new/updated rules about permitting Unpermitted ADUs, but not quite sure how the ideal sequence would go if we also want to expand it. We would certainly want to get it permitted, but the amnesty, etc only works for work down prior to 2020.

Does anyone have any experience with this sort of scenario?

I was thinking something like:

1) get it inspected by the city.

2) fix/correct everything that needs to be fixed immediately per the inspector (seems likely mostly tied to safety)

3) work with a designer/architect/engineer to design the ADU expansion, while also incorporating any of the other issues that need to get fixed on the original ADU but that don't need to be immediately fixed,

4) get the permits for step #3,

5) build.

Thoughts? Thank you!

We are hoping to get my parents to move out here to spend half the year in the ADU.

Also, depending on what area of the country you are looking, the strength of the offer matters. Out here in the Bay Area, where there is a lot of cash to go around and offers are typically above list, the more down you put the stronger your offer looks, and the higher percentage that you're offer will get selected over the other dozen offers. We put down 25% into our current primary residence for that very reason.

We have 10 renters, and we only accept electronic payments. Venmo is our preferred payment method, and the majority pay that way. We also use Venmo in our everyday life to ship money between friends. So fast and easy. Those that don't use Venmo, use PayPal. PayPal is actually free, if you use it in the right way. You can send money to friends and family for free, so you just need to have people send it to you via your email address and to "friends & family," and you get 100% of the money. Hope that helps.

Originally posted by @Ryan D.:

Also, the most "reasonably priced" (and that terms takes on a grossly distorted meaning out here) area in the South Bay with good schools is Scotts Valley. Everywhere else that is "affordable " has terrible public schools.

 Hi Ryan,

Thanks for the tip. I wholeheartedly agree on the "affordable" question. 5 years ago I lived in Eau Claire, WI, and we had a 4/2 house there, only 2 blocks from the downtown strip, for $75k.

Unfortunately, at least in terms of living, Scotts Valley is outside of our comfortable range. My Mother in law lives in Cupertino and my sister-in-law (with twins the same age as our son) live in Campbell (so yea, really, really cheap areas), so really we are looking at places with 20-25 mins or so of those two locations.

We have actually looked at some land that is available in the outskirts of Los Gatos (and are part of Los Gatos schools), and have thought about buying that and even building like a tiny home there at first, and then over time building out the property.

Originally posted by @John Erik Fraker:

Originally posted by @James Yang:

What's wrong with SJSU and Coyote Creek, @Sam Shueh?

That's the flood zone from earlier this year. 

I live in the area between SJSU and Coyote Creek, and love this general area.

Obviously the further you get to Coyote Creek the more chance a given house was located in the flood zone, but there was no standing water within 3/4  a mile of us.

Hi Everyone!

I'm excited to learn from everyone here.

I'm originally from Michigan (Detroit area), but have lived in 8 states, and have called the Bay Area home for 3 years now.

My wife is amazing. She bought her first house at something like 22yo, lives frugally, prefers to have roommates and other arrangements in order to have zero rent, and is ok with living in C areas as necessary.

She has followed a trade up philosophy with her primary residences over the years (which has brought now brought us to San Jose), and used an extra cash on hand (after reserves) to further her real estate goals. She bought one house has a designated rental, but after that, every other house was bought with the intent of living it in as a primary residence (either at the time of purchase, or in the future). We also tend to prefer to rent out individual rooms (versus entire houses) in the she owns. As such, we have some decent volume of experience on the landlord/tenant front. She got her CAreal estate license along the way to give her access to MLS, access to homes for sale as she wants, and to save on commissions.

She/We don't flip per se, but (with only one exception) typically buy houses with opportunities for improvements, and then improve them while we/renters live in them, and then sell them a few years later.

I am lucky enough to have married into a mini-RE mogul ;-)

I call myself a reformed lawyer. Back in the day I did M&A/venture capital law, but got laid off during the 2009 recession, and got out of law as fast as I could. I am not actively licensed in CA, but I use my ability to analyze regulation/laws to help with our current tiny RE portfolio.

Our short term goal (2018) is to take the profits from a rental that we currently own in Sacramento (and that we plan to sell in early 2018), to buy a multi-family unit in San Jose or elsewhere in the South Bay (most likely duplex, but looking at tri- and four-plexes). We will live in one unit, rent out the others.

Longer term:

(1) I'd love to look into other real estate investment opportunities (not to eager to buy OOS, but ok with driveable places to use like Sac, Stockton, etc.). So, I hope to be a sponge here and learn all that I can. I would love to also figure out commercial RE. I hope to see if I can put my law background to use, if I can.

(2) We currently have an infant, and I'm not super keen on paying for private school. But, we are tied to living in the South Bay for family reasons. Currently we live in downtown San Jose. Great, fun area, but many are the public schools crappy. So, we are looking to find a place in the South Bay with a least OK schools that we can move to by the time our kid is in elementary school. That may mean liquidating/refi-ing some of our other RE to pull out the funds to do that.

-Tom

In terms of the potential rental value, we have a property with a maybe 200 sq foot detached studio (w/o kitchen) in the back of the main property that rents for $1,300/mo in downtown-ish SJ