Newbie from SF Bay Area / Silicon Valley, CA - Kyle Buyers
Hello Everyone,
I found BP a few weeks ago and have been voraciously reading and listening as much as I can since. I’m hoping to (1) introduce myself, and (2) get some guidance/wisdom on my current situation.
First off, nice to meet all of you and thank you for spending your time helpfully here. I’m a Bay Area, CA resident (most of my life) looking to make my first purchase in the next year or so. I’ll be getting help to make the down payment (still confirming the upper limit), and I hope to have it be a live-in property so I can funnel my usual rent payments into equity instead.
Based on the BP eBook, I’ve identified that the best strategy for me is to get a small multi-family unit. This is for several reasons:
- I have a W2 day job that I very much like and plan on keeping; this definitely limits the approaches I can take/strategies available, given it’s a 40+ hr/week job with some travel
- My goal here is to increase my net worth first, and earn cash flow second. I am 30, and aim to retire/earn financial independence by 45.
- Ideally I want to earn cash flow, though I realize in this area it’s a pipe dream and at best I will just cover my costs (which I believe is okay, because building equity will still help)
- The markets I know best are the ones I’ve lived in for many years, which is the Bay Area first, Vancouver BC second (though I’d prefer to not deal with cross-country finances), and Lake Tahoe, CA third. Though I’m open to investing in Tahoe, I won’t be able to live there while working (it’s a 4+ hour drive) so I believe that’s out for now.
Current situation:
- Excellent credit
- Down payment ready, though I am confirming exact number with my father who is planning to help with this
- Working in San Jose/95125, would prefer to not have to commute more than 40 minutes/day
- Family is in Sunnyvale, Foster City, and SF so I’d rather not move too much farther south than SJ
- My skills: I’m extremely detail-oriented, good with numbers, and work in Marketing for a living. I am less handy though (so house-flipping is out). I’m the type of person who looks into the fine print and has the grit to push through to make something happen; I understand real estate is a challenging, long-term game and I’m comfortable with that.
Questions and challenges:
- Should I look into down payment assistance and use the money from my father to improve a property/force appreciation instead?
- Is a multi-family property even possible/available in my price range?
- Alternatively, should I try to find as large a house as I can afford with many rooms, then rent out to roommates/tenants instead?
- If I’m looking to make money off this and lower my tax burden, should I start a separate company that owns the property, pays the team (contractors, accountant, etc.), and manages the tenants? Or is that overkill?
- Given my current situation, are there other approaches I’m overlooking that I shouldn’t?
- Anything else I’m missing?
Again, THANK YOU all for your willingness to help (or even read this long intro). I know the Bay Area is a unique and challenging market. Hopefully I meet some of you along the way, and I’d be happy to buy you lunch and glean some wisdom if you’ve been working with real estate here for 5+ years. :)