Buying multiple properties in year 1 - can I keep this up?

161 Replies

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

Originally posted by @Nick Colvill :

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.

Originally posted by Account Closed:
Originally posted by @Nick Colvill:

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.

 Thanks for the input! You sound pessimistic or, at the very least, reserved regarding purchases in CA. You said you enjoy great cash flow AND increasing values, and I would argue that both can be achieved in the San Jose market, being one of the highest valued real estate markets AND one of the highest rental markets

That being said, my San Jose house is my primary and I only want one thing - appreciation, with no need for cash flow from rent. 

What do you foresee happening in 2021?

Lastly, let me pose this question to you - would you, if you had the capital to invest in a higher priced area like San Jose, do it? If the appreciation is higher, the rental market year over year is stronger, I imagine the answer would be yes, but i won't speak for you. I think truly the greatest barrier to entry in this area is the initial investment. There is something odd i've noticed though; when I think of putting 300k down on a duplex in San Jose, even though the yearly income on that could be around 70-80k (being conservative), that doesn't personally excite ME as much as putting 300k down on an apartment complex in Sacramento area with more units, less rent per unit, and most likely less overall income for the year. Its a strange phenomenon.

For the record, I plan to invest in multi family units in 2019 and I will NOT be looking in San Jose for that very reason

Originally posted by @Nick Colvill :
Originally posted by @Mike M.:
Originally posted by @Nick Colvill:

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.

 Thanks for the input! You sound pessimistic or, at the very least, reserved regarding purchases in CA. You said you enjoy great cash flow AND increasing values, and I would argue that both can be achieved in the San Jose market, being one of the highest valued real estate markets AND one of the highest rental markets

That being said, my San Jose house is my primary and I only want one thing - appreciation, with no need for cash flow from rent. 

What do you foresee happening in 2021?

Lastly, let me pose this question to you - would you, if you had the capital to invest in a higher priced area like San Jose, do it? If the appreciation is higher, the rental market year over year is stronger, I imagine the answer would be yes, but i won't speak for you. I think truly the greatest barrier to entry in this area is the initial investment. There is something odd i've noticed though; when I think of putting 300k down on a duplex in San Jose, even though the yearly income on that could be around 70-80k (being conservative), that doesn't personally excite ME as much as putting 300k down on an apartment complex in Sacramento area with more units, less rent per unit, and most likely less overall income for the year. Its a strange phenomenon.

For the record, I plan to invest in multi family units in 2019 and I will NOT be looking in San Jose for that very reason

 It's an interesting subject and is an ongoing discussion at 

https://www.biggerpockets.com/forums/12/topics/609...

My answer is there, the post with the spreadsheet. I do things a bit differently. The spreadsheet explains how I deal with fluctuating markets.

Regarding the next couple of years, I think some markets will "correct" such as Seattle, The Bay Area, So. Cal. because a lot of what has been driving those price increases is Chinese investing in the West Coast. That investing has been throttled by the Chinese Govt and we are already seeing "days on market" extending. Phoenix has a net "in migration" so we should be steady for a couple of years.

Originally posted by Account Closed:
Originally posted by @Nick Colvill:

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.

 Mike when you state the CA beaches are “a few hours away”... you mean 6 right? 

I am curious, are either of these properties rentals or are you counting on appreciation? Could you rent your primary residence out if your job situation or other personal factors forced a move and have cash-flow? 

Personally I haven't considered my primary residence an investment, probably because when I retire I will probably want a different type of home, but unless I move away I will likely spend as much on a replacement or more. What do others think?  

Account Closed have you ever lived in the Bay Area? Or Seattle?

The concept you laid out in your spreadsheets is very interesting, and I love the creativity involved. This is the type of stuff that can differentiate the successful from the non-successful. Quick question; when you assume that you can take over the existing loan, are you referring to assuming the loan that the seller has on the property? Do you guys see a lot of assumable loans out there in AZ? We most certainly do not see assumable loans unless it is commercial, so in conventional residential lending it's not very common, if seen at all in my area

Originally posted by @Nick Colvill :

@Mike M. have you ever lived in the Bay Area? Or Seattle?

The concept you laid out in your spreadsheets is very interesting, and I love the creativity involved. This is the type of stuff that can differentiate the successful from the non-successful. Quick question; when you assume that you can take over the existing loan, are you referring to assuming the loan that the seller has on the property? Do you guys see a lot of assumable loans out there in AZ? We most certainly do not see assumable loans unless it is commercial, so in conventional residential lending it's not very common, if seen at all in my area

 I made my first million flipping properties in Seattle. We left there to find sanity. ;-) We looked at Santa Barbara, Newport Beach, Oceanside, & La Jolla before deciding we didn't like the traffic, the prices of properties and the taxes. I haven't lived in the Bay Area but I've spent a lot of time visiting relatives in Menlo Park & Palo Alto. Well, I did live for a short time in San Jose when it was orange groves, circa 1965 but my folks didn't like it there and moved us back to Seattle. Much later, when I was working in the computer industry I would be sent from Seattle to San Jose on a regular basis and I watched it grow into what it is today.

What I do is similar to assuming the loan, however no bank approval is required. It can be done in all 50 states, but I focus on AZ & TX at this point. My lowest cash flowing property using this technique, (the amount I get to keep) is about $600 per month after paying the mortgage.  Some go higher and I have one at about $1000 a month. I just picked up another two, one of which the underlying payment is $720 a month and I have someone who is about to sign for $21k down, which goes into my pocket, and $1650 a month, so it will cash flow for about $930 a month. The other is similar and will cash flow for about $1055. I have a couple of people competing for that one so I'll be getting about $25k down. That one is a "hoarder house" and it's taking them longer to clear everything out and move.

Originally posted by Account Closed:
Originally posted by @Mike M.:
Originally posted by @Nick Colvill:

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.

 Mike when you state the CA beaches are “a few hours away”... you mean 6 right? 

 Correct. It's outside of earthquake country, outside of forest fire country, outside of canyon fire country and we enjoy the drive (until we hit Riverside ;-)

Originally posted by Account Closed:
Originally posted by @Saj Shah:
Originally posted by Account Closed:
Originally posted by @Nick Colvill:

Jumping in to real estate was a well-calculated move. I live in San Jose, and this market is notorious for making people lose faith in their ability to purchase. 

I bought my primary residence in May of 2017 - a brand new million dollar 3 story 2200 sq ft home and closed on a 500k vacation/rental in Lake Tahoe right before the new year. 

The primary was financed with 10% down and the rental was financed with 20% down. 

I strongly believe the the community I purchased my primary in has massive potential upside, and have been blown away by the prices i've seen my neighbors sell their properties for within just a year of owning. 

I'm sharing this in the "success stories" section because I can't stand how discouraged people get, and I truly despise the mindset of "i'll just wait for the market to crash"

We need to find a way to make it work - no one will do it for us

 Congratulations. If your purchases in CA made you happy, no one is going to rain on your parade.

However, most people will look at the profit (return on investment) along with the sense of satisfaction of having bought. I choose not to buy in California for several reasons (taxes being one) and inflated prices as you mention. 

When I can buy a property in Phoenix, where the taxes are more favorable for $225,000 instead of $500,000 as in California, with high tech jobs moving into the area, and only a few hours away from California beaches, I'm going to buy in AZ every time. I enjoy great cash flow and increasing values.

More people can afford to get into investing at a $225,000 price point than can get in for $500,000. Kudos to you for getting in at $500,000. We shall see if that truly was the way to go, over the next couple of years as we approach 2021.

 Mike when you state the CA beaches are “a few hours away”... you mean 6 right? 

 Correct. It's outside of earthquake country, outside of forest fire country, outside of canyon fire country and we enjoy the drive (until we hit Riverside ;-)

 haha great way to describe it.

I used to live in Pomona (10/57 freeways meet) and I could’ve sworn it took us 6 hours to get to Glendale for Spring Training

Originally posted by @Gretchen P. :

I am curious, are either of these properties rentals or are you counting on appreciation? Could you rent your primary residence out if your job situation or other personal factors forced a move and have cash-flow? 

Personally I haven't considered my primary residence an investment, probably because when I retire I will probably want a different type of home, but unless I move away I will likely spend as much on a replacement or more. What do others think?  

 I rent the Tahoe home to friends and family but don’t stress about cash flow from it; I bought it as a getaway for my family and any extra money is icing. I do, however, consider my primary an investment most definitely. I will be using its equity to upgrade to bigger primaries or fund future rental with HELOCS. It’s an appreciating asset that I’m not counting on cash flow from 

Originally posted by Account Closed:
Originally posted by @Nick Colvill:

Account Closed have you ever lived in the Bay Area? Or Seattle?

The concept you laid out in your spreadsheets is very interesting, and I love the creativity involved. This is the type of stuff that can differentiate the successful from the non-successful. Quick question; when you assume that you can take over the existing loan, are you referring to assuming the loan that the seller has on the property? Do you guys see a lot of assumable loans out there in AZ? We most certainly do not see assumable loans unless it is commercial, so in conventional residential lending it's not very common, if seen at all in my area

 I made my first million flipping properties in Seattle. We left there to find sanity. ;-) We looked at Santa Barbara, Newport Beach, Oceanside, & La Jolla before deciding we didn't like the traffic, the prices of properties and the taxes. I haven't lived in the Bay Area but I've spent a lot of time visiting relatives in Menlo Park & Palo Alto. Well, I did live for a short time in San Jose when it was orange groves, circa 1965 but my folks didn't like it there and moved us back to Seattle. Much later, when I was working in the computer industry I would be sent from Seattle to San Jose on a regular basis and I watched it grow into what it is today.

What I do is similar to assuming the loan, however no bank approval is required. It can be done in all 50 states, but I focus on AZ & TX at this point. My lowest cash flowing property using this technique, (the amount I get to keep) is about $600 per month after paying the mortgage.  Some go higher and I have one at about $1000 a month. I just picked up another two, one of which the underlying payment is $720 a month and I have someone who is about to sign for $21k down, which goes into my pocket, and $1650 a month, so it will cash flow for about $930 a month. The other is similar and will cash flow for about $1055. I have a couple of people competing for that one so I'll be getting about $25k down. That one is a "hoarder house" and it's taking them longer to clear everything out and move.

 This “strategy” that you use in reference to assuming loans - is it legal and kosher? If so, what is it called? You are very indirect about how you are actually able to legally assume these residential loans (something that is not common at all) so i think we would all benefit from any elaboration please! 

Originally posted by @Nick Colvill :
Originally posted by @Mike M.:
Originally posted by @Nick Colvill:

@Mike M. have you ever lived in the Bay Area? Or Seattle?

The concept you laid out in your spreadsheets is very interesting, and I love the creativity involved. This is the type of stuff that can differentiate the successful from the non-successful. Quick question; when you assume that you can take over the existing loan, are you referring to assuming the loan that the seller has on the property? Do you guys see a lot of assumable loans out there in AZ? We most certainly do not see assumable loans unless it is commercial, so in conventional residential lending it's not very common, if seen at all in my area

 I made my first million flipping properties in Seattle. We left there to find sanity. ;-) We looked at Santa Barbara, Newport Beach, Oceanside, & La Jolla before deciding we didn't like the traffic, the prices of properties and the taxes. I haven't lived in the Bay Area but I've spent a lot of time visiting relatives in Menlo Park & Palo Alto. Well, I did live for a short time in San Jose when it was orange groves, circa 1965 but my folks didn't like it there and moved us back to Seattle. Much later, when I was working in the computer industry I would be sent from Seattle to San Jose on a regular basis and I watched it grow into what it is today.

What I do is similar to assuming the loan, however no bank approval is required. It can be done in all 50 states, but I focus on AZ & TX at this point. My lowest cash flowing property using this technique, (the amount I get to keep) is about $600 per month after paying the mortgage.  Some go higher and I have one at about $1000 a month. I just picked up another two, one of which the underlying payment is $720 a month and I have someone who is about to sign for $21k down, which goes into my pocket, and $1650 a month, so it will cash flow for about $930 a month. The other is similar and will cash flow for about $1055. I have a couple of people competing for that one so I'll be getting about $25k down. That one is a "hoarder house" and it's taking them longer to clear everything out and move.

 This “strategy” that you use in reference to assuming loans - is it legal and kosher? If so, what is it called? You are very indirect about how you are actually able to legally assume these residential loans (something that is not common at all) so i think we would all benefit from any elaboration please! 

 Your Question:  "is it legal and kosher? If so, what is it called?" It is simply Subject To or Sub 2 as some put it. Yes, it is perfectly legal. No, not everybody understands how to do them properly. No, I don't mentor ;-) I do however sell them ready to go as turnkey. You can do a search in the box above for Subject To here is a link 

https://www.biggerpockets.com/search?utf8=%E2%9C%9...

or, you can go to my profile and scroll down the lists of my posts and get a pretty good idea of how it works. Or, you can ask me whatever about Subject To, Wraps, Lease Options, Land Contracts, Seller Financing & regular financing (I once upon a time was a loan officer) and the Phoenix / Glendale / Mesa / Gilbert / Chandler market of AZ is a great place for doing these. I also do them in Texas but TX is a different state and has different markets like Austin, San Antonio, Dallas and Houston. It's just a different variant to use there, but very successfully done as well.

Originally posted by Account Closed:
Originally posted by @Nick Colvill:
Originally posted by Account Closed:
Originally posted by @Nick Colvill:

Account Closed have you ever lived in the Bay Area? Or Seattle?

The concept you laid out in your spreadsheets is very interesting, and I love the creativity involved. This is the type of stuff that can differentiate the successful from the non-successful. Quick question; when you assume that you can take over the existing loan, are you referring to assuming the loan that the seller has on the property? Do you guys see a lot of assumable loans out there in AZ? We most certainly do not see assumable loans unless it is commercial, so in conventional residential lending it's not very common, if seen at all in my area

 I made my first million flipping properties in Seattle. We left there to find sanity. ;-) We looked at Santa Barbara, Newport Beach, Oceanside, & La Jolla before deciding we didn't like the traffic, the prices of properties and the taxes. I haven't lived in the Bay Area but I've spent a lot of time visiting relatives in Menlo Park & Palo Alto. Well, I did live for a short time in San Jose when it was orange groves, circa 1965 but my folks didn't like it there and moved us back to Seattle. Much later, when I was working in the computer industry I would be sent from Seattle to San Jose on a regular basis and I watched it grow into what it is today.

What I do is similar to assuming the loan, however no bank approval is required. It can be done in all 50 states, but I focus on AZ & TX at this point. My lowest cash flowing property using this technique, (the amount I get to keep) is about $600 per month after paying the mortgage.  Some go higher and I have one at about $1000 a month. I just picked up another two, one of which the underlying payment is $720 a month and I have someone who is about to sign for $21k down, which goes into my pocket, and $1650 a month, so it will cash flow for about $930 a month. The other is similar and will cash flow for about $1055. I have a couple of people competing for that one so I'll be getting about $25k down. That one is a "hoarder house" and it's taking them longer to clear everything out and move.

 This “strategy” that you use in reference to assuming loans - is it legal and kosher? If so, what is it called? You are very indirect about how you are actually able to legally assume these residential loans (something that is not common at all) so i think we would all benefit from any elaboration please! 

 Your Question:  "is it legal and kosher? If so, what is it called?" It is simply Subject To or Sub 2 as some put it. Yes, it is perfectly legal. No, not everybody understands how to do them properly. No, I don't mentor ;-) I do however sell them ready to go as turnkey. You can do a search in the box above for Subject To here is a link 

https://www.biggerpockets.com/search?utf8=%E2%9C%9...

or, you can go to my profile and scroll down the lists of my posts and get a pretty good idea of how it works. Or, you can ask me whatever about Subject To, Wraps, Lease Options, Land Contracts, Seller Financing & regular financing (I once upon a time was a loan officer) and the Phoenix / Glendale / Mesa / Gilbert / Chandler market of AZ is a great place for doing these. I also do them in Texas but TX is a different state and has different markets like Austin, San Antonio, Dallas and Houston. It's just a different variant to use there, but very successfully done as well.

 I didn’t ask if you do mentoring, but I appreciate the assumption. 

What I truly appreciate are the keywords and search phrases. This thread will undoubtedly help many searchers expand their knowledge. Thank you!

Originally posted by @Nick Colvill :
Originally posted by @Mike M.:
Originally posted by @Nick Colvill:
Originally posted by @Mike M.:
Originally posted by @Nick Colvill:

@Mike M. have you ever lived in the Bay Area? Or Seattle?

The concept you laid out in your spreadsheets is very interesting, and I love the creativity involved. This is the type of stuff that can differentiate the successful from the non-successful. Quick question; when you assume that you can take over the existing loan, are you referring to assuming the loan that the seller has on the property? Do you guys see a lot of assumable loans out there in AZ? We most certainly do not see assumable loans unless it is commercial, so in conventional residential lending it's not very common, if seen at all in my area

 I made my first million flipping properties in Seattle. We left there to find sanity. ;-) We looked at Santa Barbara, Newport Beach, Oceanside, & La Jolla before deciding we didn't like the traffic, the prices of properties and the taxes. I haven't lived in the Bay Area but I've spent a lot of time visiting relatives in Menlo Park & Palo Alto. Well, I did live for a short time in San Jose when it was orange groves, circa 1965 but my folks didn't like it there and moved us back to Seattle. Much later, when I was working in the computer industry I would be sent from Seattle to San Jose on a regular basis and I watched it grow into what it is today.

What I do is similar to assuming the loan, however no bank approval is required. It can be done in all 50 states, but I focus on AZ & TX at this point. My lowest cash flowing property using this technique, (the amount I get to keep) is about $600 per month after paying the mortgage.  Some go higher and I have one at about $1000 a month. I just picked up another two, one of which the underlying payment is $720 a month and I have someone who is about to sign for $21k down, which goes into my pocket, and $1650 a month, so it will cash flow for about $930 a month. The other is similar and will cash flow for about $1055. I have a couple of people competing for that one so I'll be getting about $25k down. That one is a "hoarder house" and it's taking them longer to clear everything out and move.

 This “strategy” that you use in reference to assuming loans - is it legal and kosher? If so, what is it called? You are very indirect about how you are actually able to legally assume these residential loans (something that is not common at all) so i think we would all benefit from any elaboration please! 

 Your Question:  "is it legal and kosher? If so, what is it called?" It is simply Subject To or Sub 2 as some put it. Yes, it is perfectly legal. No, not everybody understands how to do them properly. No, I don't mentor ;-) I do however sell them ready to go as turnkey. You can do a search in the box above for Subject To here is a link 

https://www.biggerpockets.com/search?utf8=%E2%9C%9...

or, you can go to my profile and scroll down the lists of my posts and get a pretty good idea of how it works. Or, you can ask me whatever about Subject To, Wraps, Lease Options, Land Contracts, Seller Financing & regular financing (I once upon a time was a loan officer) and the Phoenix / Glendale / Mesa / Gilbert / Chandler market of AZ is a great place for doing these. I also do them in Texas but TX is a different state and has different markets like Austin, San Antonio, Dallas and Houston. It's just a different variant to use there, but very successfully done as well.

 I didn’t ask if you do mentoring, but I appreciate the assumption. 

What I truly appreciate are the keywords and search phrases. This thread will undoubtedly help many searchers expand their knowledge. Thank you!

 Your Comment: "I didn’t ask if you do mentoring, but I appreciate the assumption." Actually, that wasn't for you, ;-) it was for the moderators who delete posts if there is any suggestion of that kind of thing. I can understand what their concern is, many people have paid a great deal of money to have someone mentor them only to be disappointed. Since I don't mentor, it doesn't affect me, but it interrupts the flow of the conversation when they start deleting posts. 

What I do, anyone can do (when they take the time to study) and it doesn't require a mentor.

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

Originally posted by @Account Closed :

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

Originally posted by @Nick Colvill :
Originally posted by @Ezekiel Racelis:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

Originally posted by @Nick Colvill :
Originally posted by @Ezekiel Racelis:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Mike M. is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 The way I buy properties, it doesn't matter if the market goes up or goes down or stays stagnant. I buy houses that have "instant equity". If the prices go down, I'm covered, since I have also optioned it out to a Tenant Buyer who put down 10%. With that 10%, I put it in the bank & I then have "reserves". If the market goes up, I'm just that much happier. The reason I watch to see where the market is going is because even more people have a tough time selling in a declining market when there is growing competition from people who want to get out while they can. They want to sell and they are more willing to sell using creative financing. Think of it this way, someone has been transferred, someone hates the traffic or the weather or probate or divorce or lost a job, someone wants to sell, their house is worth $500,000 but they don't have enough equity or cash to cover the real estate agent's fee of 6% or about $30,000. They call me. Then there is no real estate fees. Simple stuff, but powerful in the right situations. About 7% of the population needs to sell *now* at any given time. I act quickly, and their problem is solved.

Originally posted by @Account Closed :
Originally posted by @Nick Colvill:
Originally posted by Account Closed:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

 You and I are on the same page about the effects of increasing rates (they couldn’t stay so artificially low for so long without consequnces) and the benefits of the tax bill

I asked you if you had any data or could at least point to any tangible signs of the Bay Area market taking a “hard hit” (your words) any time soon. 

Originally posted by @Account Closed :
Originally posted by @Nick Colvill :
Originally posted by Account Closed:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Mike M. is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

 Wow! "you know that increasing the rates and the tax bill HELPS the economy"

@Eziekel interesting economics! Well then, may your rates and taxes rise to the moon. ;-)

Originally posted by Account Closed:
Originally posted by @Ezekiel Racelis:
Originally posted by @Nick Colvill :
Originally posted by @Ezekiel Racelis:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

 Wow! "you know that increasing the rates and the tax bill HELPS the economy"

@Eziekel interesting economics! Well then, may your rates and taxes rise to the moon. ;-)

 LMAO, have you even read the actual tax bill? Do you know what the fed rates are for? Really got to research the market. Easy to make a ton of money when for the past ten years every money has been nothing but up...

Originally posted by @Nick Colvill :
Originally posted by @Ezekiel Racelis:
Originally posted by @Nick Colvill:
Originally posted by @Ezekiel Racelis:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

 You and I are on the same page about the effects of increasing rates (they couldn’t stay so artificially low for so long without consequnces) and the benefits of the tax bill

I asked you if you had any data or could at least point to any tangible signs of the Bay Area market taking a “hard hit” (your words) any time soon. 

 Look at the S&P 500 trend. it basically encompasses the stock market. You would see that in the past year the prices are starting to consolidate instead of a steady up. That is a sign that investors are liquidating assets. When that starts trending down, that will initiate full liquidation of companies. That's the simple version of it. But when investors liquidate companies will start cutting jobs due to the loss of income from stock market. The bay area has a lot of those companies. When jobs are cut, people start to foreclose on homes. When homes are foreclosed, the surrounding homes' value are lowered.

Originally posted by @Account Closed :
Originally posted by @Nick Colvill:
Originally posted by Account Closed:
Originally posted by @Nick Colvill:
Originally posted by Account Closed:

@Nick Colvill Not really familiar with the San Jose RE market, but if it is like any other CA market; a recession will hit it hard. Biggest reason why investors will not start in CA unless they have the funds to sustain the value of a recession when it was inflated when bought. 

I do know the economics of San Jose due to being a stock investor and San Jose is the one of the biggest manufacturing city in the West Coast. However, manufacturing companies are the first to cut when a recession starts. 

There's already a lot of investors pulling out of California (not just Residential Investors), due to the Stock Market showing signs of potential recession. So while your plan for appreciation is good, what will happen when there is a recession? Many experts are already saying it will most likely happen towards the end of next year. The only thing that saved it from happening this year was the tax bill. 

What @Account Closed is most likely talking about are subject to. I would be very careful with those since it technically is not illegal, but if the property is still under a mortgage, the mortgage lender can call the loan. a very useful tool if you know what you are doing, but I personally wouldn't want to go that route. 

Just to give you an example: in 2007-08 recession, the California Housing Market went down by about 35%. 

 I’d be careful throwing around numbers like “the California housing market went down by about 35%”

CA is a huge state with a wide variance in prices - but the Bay Area was most certainly not hit as hard as you suggest. 

What other data do you have to support an upcoming crash in the Bay Area other than historical anecdotes? Or anecdotes of people saying they think it might happen. 

It’s interesting that you use the tax bill as a cause for the recession NOT to hit - many people blame the tax bill and subsequent increase in rates as an indicator that prices WILL drop 

 You're right, you don't have to believe me or majority of investors on here. If you know anything about economics, you know that increasing the rates and the tax bill HELPS the economy and prevents recession. Don't really want to get into economics since it'll be too much to put on here if you don't even know how rates and the tax bill are keeping the recession at bay.  

 You and I are on the same page about the effects of increasing rates (they couldn’t stay so artificially low for so long without consequnces) and the benefits of the tax bill

I asked you if you had any data or could at least point to any tangible signs of the Bay Area market taking a “hard hit” (your words) any time soon. 

 Look at the S&P 500 trend. it basically encompasses the stock market. You would see that in the past year the prices are starting to consolidate instead of a steady up. That is a sign that investors are liquidating assets. When that starts trending down, that will initiate full liquidation of companies. That's the simple version of it. But when investors liquidate companies will start cutting jobs due to the loss of income from stock market. The bay area has a lot of those companies. When jobs are cut, people start to foreclose on homes. When homes are foreclosed, the surrounding homes' value are lowered.

 I imagine since you play the stock market and you are noticing that we are nearing a downward trend that you are  holding some pretty large short positions in the S&P? 

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