Hi BP community - my name is Akshar and I am a new investor hoping to close my first deal this year.
My background: I have worked in the hedge fund industry for over 4 years, and am now trying to diversify some of my wealth into real estate. I am most interested in running a buy-and-hold strategy, but I am unsure of whether I should start investing out of state, or in the area in and around the Bay Area. My main objective is to buy properties (preferably SFH for my first deal) with strong cash flow (looking for 6%+ cash on cash return), with some appreciation on top, which I know is challenging in the Bay Area. However, traveling long distances to buy and rehab properties out of state can be very time consuming, which is a large con for me given my very very busy schedule.
I would love to connect with other investors located in the Bay Area, and am hoping to find some local REIA networking groups/meet ups (please let me know if you are aware of any!) I have been on BP for a few months, and I hoping to learn from other investors, find a mentor, and network!
Looking forward to being a part of the BP community, and getting to know other investors!
@Akshar Puri I don't know your market and the numbers well, but do know we have a lot of clients from your area that invest in Boise. If you are crushing it in your W-2 it will likely be more beneficial to just find a team in place OOS where landlord laws are kind and the numbers work for you. Finding the balance of appreciation and cashflow will help determine your market.
However if you are looking to rehab the property and manage it I would look to something more local as time and travel will add up and make it really unenjoyable if you don't.
Welcome to BP - I think you should definitely embrace the idea of investing out of state sooner rather than later, especially since you mentioned cash flow as your goals. Going to be extremely hard to get strong cash flow in the Bay Area especially with your busy schedule (the only way to do it would be something like BRRRR projects with you putting in a lot of time and work yourself). BP has a lot of good resources (especially the full books in the bookstore) on out of state investing where you don't have to travel or spend much time at all investing out of state which seems like sounds like the best path forward for ya
Hey Akshar, I'm not far from you down here in the Central Coast (Arroyo Grande to be exact). I'm also up in the bay area a couple times a year.
Anyway, if it's of interest I can talk to you about the Detroit market. I own 12-doors there now and I'm finishing up a duplex here soon as well.
My properties cash flow like crazy and have seem extremely good appreciation as well. I have a partner on the ground there that runs a turnkey operation to help identify properties, rehab them, and ultimately manage as well. Sounds like that might be a good fit for you. Shoot me a message if you want to chat!
Hey Akshar, I'm not far from you down here in the Central Coast (Arroyo Grande to be exact). I'm also up in the bay area a couple times a year.
Anyway, if it's of interest I can talk to you about the Detroit market. I own 12-doors there now and I'm finishing up a duplex here soon as well.
My properties cash flow like crazy and have seem extremely good appreciation as well. I have a partner on the ground there that runs a turnkey operation to help identify properties, rehab them, and ultimately manage as well. Sounds like that might be a good fit for you. Shoot me a message if you want to chat!
I would also like to know options with OOS rentals. Are there any East Bay meetings soon?
You might want to follow the "Deep Dive" series we're doing on our BiggerPockets blog about Metro Detroit cities, City of Detroit Neighborhoods and comparing Metro Detroit to other hotspots investors usually consider:
(BP search feature can be problematic, so we’ve also added links @ our website under View Cities & Neighborhoods We Service)
Doubt you'll find this much info for any other market in the country. So, why would you invest remotely anywhere else?
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I am in the same boat. Returning back to the bay area and looking to see that it may be the time to get back into the Real estate. Schedules are generally busy but excellent credit and good cashflows from business
Hey Akshar, I'm not far from you down here in the Central Coast (Arroyo Grande to be exact). I'm also up in the bay area a couple times a year.
Anyway, if it's of interest I can talk to you about the Detroit market. I own 12-doors there now and I'm finishing up a duplex here soon as well.
My properties cash flow like crazy and have seem extremely good appreciation as well. I have a partner on the ground there that runs a turnkey operation to help identify properties, rehab them, and ultimately manage as well. Sounds like that might be a good fit for you. Shoot me a message if you want to chat!
I would also like to know options with OOS rentals. Are there any East Bay meetings soon?
Hey Randy, just sent you a message. I'm not sure about Bay Area meetups. I have a small one I attend here on the Central Coast but I'd love to make it up to the bay and do a meetup. Maybe we need to start one!
Hey Akshar, I'm not far from you down here in the Central Coast (Arroyo Grande to be exact). I'm also up in the bay area a couple times a year.
Anyway, if it's of interest I can talk to you about the Detroit market. I own 12-doors there now and I'm finishing up a duplex here soon as well.
My properties cash flow like crazy and have seem extremely good appreciation as well. I have a partner on the ground there that runs a turnkey operation to help identify properties, rehab them, and ultimately manage as well. Sounds like that might be a good fit for you. Shoot me a message if you want to chat!
I would also like to know options with OOS rentals. Are there any East Bay meetings soon?
Hey Randy, just sent you a message. I'm not sure about Bay Area meetups. I have a small one I attend here on the Central Coast but I'd love to make it up to the bay and do a meetup. Maybe we need to start one!
I consider myself new. I would say there could be a good demand in the Bay Area if one would be started. I live in Pleasant Hill.
Welcome @Akshar Puri! It's great that you have an idea of what your investment will look like and now need to focus on where to invest. What steps did you take to identify your ideal rental property? Could you apply those steps to identify what market to invest in?
You can make money in any market, so long as it aligns to your overall goals. Build that criteria of your ideal market that supports your goal then go out and research multiple markets to see which is a good fit.
BP has great suggestions, but it may not be a great suggestion for you. If you do the research upfront, no one should be able to convince you otherwise as to why you're investing in X and not Y.
Hi BP community - my name is Akshar and I am a new investor hoping to close my first deal this year.
My background: I have worked in the hedge fund industry for over 4 years, and am now trying to diversify some of my wealth into real estate. I am most interested in running a buy-and-hold strategy, but I am unsure of whether I should start investing out of state, or in the area in and around the Bay Area. My main objective is to buy properties (preferably SFH for my first deal) with strong cash flow (looking for 6%+ cash on cash return), with some appreciation on top, which I know is challenging in the Bay Area. However, traveling long distances to buy and rehab properties out of state can be very time consuming, which is a large con for me given my very very busy schedule.
I would love to connect with other investors located in the Bay Area, and am hoping to find some local REIA networking groups/meet ups (please let me know if you are aware of any!) I have been on BP for a few months, and I hoping to learn from other investors, find a mentor, and network!
Looking forward to being a part of the BP community, and getting to know other investors!
Congrats on getting started. There are a ton of folks in the Bay Area who are investing in Huntsville, Alabama, which I do as well. @Gorden Lopes would be happy to connect with you I'm sure.
I was in your shoes 5 years back and ended up starting a local bay area group of folks investing in Hsv. The group is very active and I am happy to add you to the group. DM me for more info.
@Chris Mignone thanks for the reply and appreciate the heads up on Huntsville! Let's connect and chat - would love to have a chance to introduce myself further and hear about your real estate journey.
@Gorden Lopes great to see another Bay Area based investor on here whose taken the initiative to create a group! Reaching out to learn more, looking forward to chatting!
I don't know exactly where in the Bay Area your located but there are two meetup's coming up in Palo Alto if your interested:https://www.meetup.com/the-bar...
I recommend selecting a location based on your goals rather than convenience. For most people, the goal of real estate investing is to secure a reliable passive income that beats inflation and lasts a lifetime. Reliable passive income must meet three criteria.
Reliable - Your income continues even in difficult economic times.
Inflation-Compensating - Rental income increases faster than inflation, compensating for rising prices.
Persistent - Your income will last; you and your spouse won't outlive it.
In order to achieve a reliable passive income, you have to get three things right:
Location - The location defines all long-term income characteristics including keeping pace with inflation and how long the income will continue.
Tenant pool - The tenant pool defines income reliability, including paying all the rent on schedule (even in bad economic times), how long they stay, and more.
Property - The property defines its tenant pool, initial return, time to rent, maintenance costs, and renovation costs.
Fortunately, there is a straightforward process for selecting the location, tenant pool, and property that eliminates the need for personal opinions, chance, or emotions.
Location Selection
Location selection consists of two steps. First, eliminate locations that are unlikely to produce reliable income. Second, evaluate the remaining locations based on your specific situation and goals. I can provide the specific steps if you are interested.
Tenant Segment Selection
Once you select a location, the next step is to select a tenant segment with a high concentration of what I call “good” tenants. A good tenant is someone who:
Has stable employment in a market segment that is very likely to be stable or improve over time
Pays all the rent on schedule
Takes care of the property
Does not cause problems with neighbors
Does not engage in illegal activities while on the property
Stays for many years
Dependable tenants are the exception, not the norm. Dependable tenants are the result of:
Selecting a tenant pool segment with a high concentration of dependable tenants.
Selecting properties your target tenant pool segment is willing and able to rent.
A property manager with the skills to select a dependable tenant from all who apply
Property Selection
There is a straightforward process for attracting the tenant segment you want. Determine what and where they rent today and buy a similar property. This may be a bit confusing so I will explain.
Every tenant segment has specific housing requirements. Housing requirements consist of four basic elements.
Location - Locations where significant percentages of the target segment live today.
Property type - What type of properties are they renting today? Condo, high rise, multi-family, single family?
Rent range - What the segment is willing and able to pay. Usually, this is about 30% of their gross monthly household income.
Configuration - Two bedrooms, three-car garage, large back yard, single-story, two stories?
The image below illustrates the relationship between segment requirements and property characteristics.
You target a specific tenant segment by choosing properties that match the target segment's requirements. If you do this, the majority of applicants will be from your target segment.
All this may sound overwhelming, but there is a straightforward path. Instead of trying to figure out everything yourself, work with an experienced local investment team.
Always Invest With a Good Local Team
Everything you learn in podcasts, seminars, books, and websites is general information. You will not buy a general property in a general location. You will buy a specific property in a specific location, subject to specific local rules and regulations. The only source of the hyperlocal information you need is an experienced local investment team.
A good local investment team already has the knowledge, skills, and resources you need to succeed. Just like you are an expert in what you do, find an expert team and let them do their job for you, especially when it does not cost you more than working with any other realtor.
Does remote investing work for new investors? More than 90% of our clients are remote, and only a handful had prior investment experience. Over 90% buy 2 or more properties, and over 80% buy 3 or more properties through us. So, remote investing works when you have a competent and experienced local team.
If you (or anyone else) want details on how to vet a local team, DM me.
Welcome to BP. I've been in the Bay Area since 2005 - first in San Francisco and now in the East Bay. I'm also looking to do my first flip in the East Bay this year as I am seeing lot of opportunities in this market. If you find a good group of real estate investors let me know! I'm also struggling to find a local live meet up that is not a marketing platform.
Background: Currently, I work as a project director in a financing/design and renovation start up on the Peninsula and I work with agents and sellers on getting a lift in their real estate listings by doing some pre-sale renovation work.
I don't know exactly where in the Bay Area your located but there are two meetup's coming up in Palo Alto if your interested:https://www.meetup.com/the-bar...
