Statrting Out with 15K - California and Nevada

9 Replies

Hi everybody, This is my very first post at BiggerPockets after I was get exposed to this amazing site and forums from one of the books ive read and im thankful for that!

I have no experience on RE or REI so far, although ive read about the REI for several years and checking the market and keep learning every day.

My situation is this- I live right now in LA, I have 15k on savings account. Im interested in Buy & Hold Strategy. The area that im looking onto is Las Vegas and LA outskirts.

About the mortgage- I have very low tax returns as l used to live out of state in the last couple of years. is that something that I can move on with or is it a deal breaker by the landlords?

are the landlords are flexible with the requirements? or the 2 years tax returns and the monthly paycheck are a most?

I have a good credit score.

What should I do next? Wait until I establish my tax returns? or go on from that point?

will you recommend investing in Las Vegas or LA outskirts? Should I buy a townhouse or a small condo apartment? what are the risks when investing in small condo apartment? what should l take into consideration when investing in small condo apartment?

Thought about buying a small condo here in LA as a start and instead of paying my rent-Just pay off my mortgage.

Id like to hear from you guys and learn from your opinions.

If someone is accidentally live in LA and feel like share his great REI knowledge, Ill be more then happy!

Thanks and have a great weekend!

Hey man welcome to BP!

I recommend you go read The millionaire Real Estate investor by Gary Keller. It will answer most of your questions. 

Also read the BP guide to tenant screening. Those will help you figure this all out.

Welcome to BP. California average housing price is $500k, FHA loans you might get away with 5-10% down BUT that requires a ton of paperwork and really high income to qualify. Conventional loans are 20% down, you do the math. You can get hard money lender for min interest rate of 10%. Las Vegas prices are more reasonable, $200k can get you a nice 3/2 in a decent neighborhood.

You live in LA, so my vote between those two is outskirts of LA. If you want to invest in Vegas, you can, but I would move to Vegas. There are so many advantages and things that you can do investing locally hands on that you just can't do out of state ... if you want to be completely hands off, then buy a REIT and be done with it.

For LA, I'd look in the Antelope Valley (Lancaster or Palmdale) to house hack your first investment property. Single families in decent neighborhoods can be had for mid $200k's and with FHA you can put as little as 3.5% on your primary residence (can get in for less than $15k down) so long as you can qualify with your income and credit (check with a mortgage broker).

I personally prefer small multis (2-4 unit) or single families with no HOA over condos ... better class of tenant generally, no HOA fees, and no loss of control to the HOA. If you do invest in a condo, make sure you at least get into a nicer, central, in demand neighborhood than you could otherwise afford. Also, make sure the HOA has minimal amenities and fees, has no restrictions on rentals (is landlord friendly), and sound financials before you buy.

Finally, whatever you buy, make sure you can afford to hold it through thick and thin (through a combination of rental and personal income) and you get a great deal ... generally, the only ones that lose out on REI in LA are those that can't afford to keep up with the expenses of the property and are forced to sell or get foreclosed on when the market dips ... sooner or later it will dip, the dip won't last, but you don't want to be that guy in the meantime.

Originally posted by @Rosston Smith :

Hey man welcome to BP!

I recommend you go read The millionaire Real Estate investor by Gary Keller. It will answer most of your questions. 

Also read the BP guide to tenant screening. Those will help you figure this all out.

 Thanks a lot man, ill take a look at those books and blogs.

Originally posted by @Dani Sung :

Welcome to BP. California average housing price is $500k, FHA loans you might get away with 5-10% down BUT that requires a ton of paperwork and really high income to qualify. Conventional loans are 20% down, you do the math. You can get hard money lender for min interest rate of 10%. Las Vegas prices are more reasonable, $200k can get you a nice 3/2 in a decent neighborhood.

 Thanks! I thinking on Vegas as my first priority right now, although lm not planning on moving there...

Originally posted by @Assaf Perets :
Originally posted by @Rosston Smith:

Hey man welcome to BP!

I recommend you go read The millionaire Real Estate investor by Gary Keller. It will answer most of your questions. 

Also read the BP guide to tenant screening. Those will help you figure this all out.

 Thanks a lot man, ill take a look at those books and blogs.

 No problem! Let me know if you have any more questions.

Originally posted by @David Faulkner :

You live in LA, so my vote between those two is outskirts of LA. If you want to invest in Vegas, you can, but I would move to Vegas. There are so many advantages and things that you can do investing locally hands on that you just can't do out of state ... if you want to be completely hands off, then buy a REIT and be done with it.

For LA, I'd look in the Antelope Valley (Lancaster or Palmdale) to house hack your first investment property. Single families in decent neighborhoods can be had for mid $200k's and with FHA you can put as little as 3.5% on your primary residence (can get in for less than $15k down) so long as you can qualify with your income and credit (check with a mortgage broker).

I personally prefer small multis (2-4 unit) or single families with no HOA over condos ... better class of tenant generally, no HOA fees, and no loss of control to the HOA. If you do invest in a condo, make sure you at least get into a nicer, central, in demand neighborhood than you could otherwise afford. Also, make sure the HOA has minimal amenities and fees, has no restrictions on rentals (is landlord friendly), and sound financials before you buy.

Finally, whatever you buy, make sure you can afford to hold it through thick and thin (through a combination of rental and personal income) and you get a great deal ... generally, the only ones that lose out on REI in LA are those that can't afford to keep up with the expenses of the property and are forced to sell or get foreclosed on when the market dips ... sooner or later it will dip, the dip won't last, but you don't want to be that guy in the meantime.

 Thanks a lot man. I appreciate your opinion, you helped a lot. 

it will be probably better for me to start with a single family or small multis rather than condos.

Welcome to BP @Assaf Perets ! Landlords are pretty flexible if your story makes sense, I recommend just being upfront about your situation so they don't just to fear-based conclusions :)

Best of luck!

Originally posted by @Madeline Burke :

Welcome to BP @Assaf Perets! Landlords are pretty flexible if your story makes sense, I recommend just being upfront about your situation so they don't just to fear-based conclusions :)

Best of luck!

 Thanks a lot. appreciate your advice :)

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