Newbie to 5 units in 7 months!

Newbie to 5 units in 7 months!

Contractor · San Jose, CA · Member since 2018 · 262 posts · 407 votes
I want to personally thank the BP Community for being so helpful and very humble with all of the questions us newbies always have. With the help of this great network my wife and I were able to start our OOS investing career at the close of 2017 and we are very blessed and thankful to say that we currently have 5 units under our belt and are in the midst of acquiring 2 more before the close of this year with the amazing growth that we gained from our first unit which we are in the process of doing a cash out Refi on. Alot of people here in the Bay Area think that OOS investing is crazy, that I'm out of my mind and that you can never grow wealth this way and that you should invest here in the Bay and blah blah blah so it was very difficult to learn and go at this alone until I found this beautiful network of good folks doing it everyday! My thing was always, sure I can invest here in the Bay Area but by the time it would take me to acquire $150k down payment I could have taken the opportunity and purchased 5 properties out of state that cash flow positively getting more bang for my buck. All I needed was a good team in place which I'm blessed to say I have in the 2 markets that I'm currently vested in. Our first deal (SFR ranch is sitting at a 10% COC return after all expenses, vacancy, maintenance, capx,property management, PITI etc.. our second deal (4plex is sitting at an 8% after the same expenses with meat on the bone to get me closer to a 9.5%) For all of those that were newbies like me hearing negative things and that you cannot build wealth, I'm here to tell you that yes you can! We have so much valuable information at our fingertips to make this possible especially with the amazing community here on BP! Thank you again all, I'm humbled and very much appreciate all of you! Junior
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Real Estate Investor · Palm Beach County, FL · Member since 2017 · 3k+ posts · 2k+ votes
8y

You never mentioned where you are investing out-of-state.

See this reply in the discussion

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  • Rental Property Investor · Plant City, FL · Member since 2015 · 1k+ posts · 379 votes
    8y

    Congrats!!  Way to take action!! 

  • Lender · Glen Burnie, MD · Member since 2018 · 39 posts · 12 votes
    8y
    @Junior Picanco thank you
  • Raleigh, NC · Member since 2017 · 347 posts · 94 votes
    8y
  • Raleigh, NC · Member since 2017 · 347 posts · 94 votes
    8y
    Originally posted by @Kayee Wilson:

    Hi Junior, 

    Thank you for your post ! Very helpful! I would like to do something similar! What’s is OOS? Can you please give me guidance? 

     Oos=out of state

  • Specialist · Louisville, KY · Member since 2017 · 166 posts · 154 votes
    8y
    @Junior Picanco Congrats! How did you find the properties? I used to live in the Dublin area, about 15 mins from Marysville. Unless Honda and Scotts Miracle Grow both melt down, you should always have a nice pool of potential renters.
  • Mike ReynoldsPro Member
    construction · Nacogdoches, TX · Member since 2011 · 2k+ posts · 1k+ votes
    8y
    Originally posted by @Junior Soares:
    @Caleb Heimsoth That's perfect! My wife and I are relocating to Texas so I will definitely contact you

    Send me a pm when you get here. Depending on the part of Texas you move to I may can help you with some reliable subs. I've worked many places in the state. 

  • Baldwin Park, CA · Member since 2018 · 18 posts · 7 votes
    8y
    @Junior Picanco That is amazing in such a short period of time. I love reading stories like this! It motivates me to continue reading and saving to hopefully invest out of state soon. I am from LA county and simar to the Bay area, coming up with a down payment for a home here can be a headache as a newbie. Wish you the best of luck in all your investments. Regards, Marvin Lara
  • Contractor · San Jose, CA · Member since 2018 · 262 posts · 407 votes
    8y
    Originally posted by @Barclay Chan:
    Originally posted by @Junior Soares:
    @VB Phom Good afternoon, I have both properties in an LLC reporting up to a holding LLC. The holding LLC holds my positive cashflow while I run each property with their own accounts. Helps me with organizing my taxes at the end of the year with my P&Ls

    Best, Junior

    I assume your LLC and holding LLC is registered in California. What made you want to register it in California than the states your properties are in?

     No sir, none are registered in California aside from my california businesses. 

  • Contractor · San Jose, CA · Member since 2018 · 262 posts · 407 votes
    8y
    Originally posted by @Kyle Schlosser:
    @Junior Picanco Congrats! How did you find the properties? I used to live in the Dublin area, about 15 mins from Marysville. Unless Honda and Scotts Miracle Grow both melt down, you should always have a nice pool of potential renters.

    Thank you brother, I purchased from one of my buddies that lives in the area. 

  • Contractor · San Jose, CA · Member since 2018 · 262 posts · 407 votes
    8y
    Originally posted by @Marvin Lara:
    @Junior Picanco That is amazing in such a short period of time. I love reading stories like this! It motivates me to continue reading and saving to hopefully invest out of state soon. I am from LA county and simar to the Bay area, coming up with a down payment for a home here can be a headache as a newbie.

    Wish you the best of luck in all your investments. Regards,

    Marvin Lara

     Thank you, Marvin. I appreciate your kind words. God bless and best of luck to you with all of your future endeavors.

  • Real Estate Investor · Marysville, OH · Member since 2014 · 242 posts · 196 votes
    8y
    Originally posted by @Kyle Schlosser:
    @Junior Picanco Congrats! How did you find the properties? I used to live in the Dublin area, about 15 mins from Marysville. Unless Honda and Scotts Miracle Grow both melt down, you should always have a nice pool of potential renters.

     The market is tighter than ever.  We were looking at moving back as early as 2013, but didn't move until end of 2014.  We just missed the crazy good deal phase in Marysville and Columbus was starting to get hot.  Bought our personal house a couple months just in time.  Ever since then there has been nothing for sale in Marysville.  Houses are gone instantly (unless they are priced bad or have problems) when they hit the market, everyone is griping that there is nowhere to rent except apartments (and they are right.) . If you own rental houses here, you are 100% occupied trivially and doing well.  Unfortunately, the purchase price side of things now makes price to get in outstripping rental market ability.  So I personally have been investing elsewhere in the state.  But if the numbers work for you, it would not be a bad idea to invest in Marysville.  A whole technology corridor is going in, people are moving to the area like crazy.  Lots of good jobs for renters here.

  • Specialist · Lakewood, CO · Member since 2018 · 12 posts · 2 votes
    8y
    @Junior Picanco this is an awesome post! Congrats! My husband and I are starting out as well and have big dreams. I’m curious about your LLC structure. Can I PM you?
  • San Jose, CA · Member since 2018 · 4 posts · 1 vote
    8y

    @Junior Soares Congratulations, and thank you for sharing your story! You're an inspiration to us all!

  • Rental Property Investor · North Plainfield, NJ · Member since 2018 · 2 posts · 0 votes
    8y
    @Junior Picanco Hi I have the same question as Marvin, did you go out to these locations to see them in person before purchasing and renting them out? Do you use property managers?
  • Rental Property Investor · Battle Creek, MI · Member since 2018 · 24 posts · 16 votes
    8y
    @Junior Picanco if you don’t mind me asking, what property management company are you currently using in Michigan and are you pleased with their work?
  • Rental Property Investor · North Plainfield, NJ · Member since 2018 · 2 posts · 0 votes
    8y
    @Brieer Doggett Hi Brieer, I’m also brand new to real estate investment and I see you’re from NJ. Maybe we can connect and I can pick your brain as to what lead you to start in this type of investments.
  • Member since 2018 · 13 posts · 6 votes
    8y
    Originally posted by @Brian Cox:

    @Cassandra Sifford also a newbie suffering from analysis paralysis! 

    I'm doing CAP rate > 10%, profit of $200/mo, and the 1% rule. Trying to find properties that check off all 3.

    What are you using? 

    How does the HELOC work out for you? I cant get over the interest payments - and I'm debating selling some stock in my brokerage acct to use as my down payment on my first property. Figuring out financing is my next hurdle.

    I am in the same boat! I cant get over the double interest payments on the HELOC and the conventional loan. It just seems so counterintuitive. My funds are also in my stocks. Let me know what you decide to do. I think I might use both stock and the heloc to buy 2 properties.

  • Rental Property Investor · Willow Grove, PA · Member since 2014 · 10 posts · 4 votes
    8y

    @Jason Ngo I was researching selling stock today and think I'm coming back to the HELOC. Cap gains tax and the fact that stocks should appreciate more than the interest on the HELOC. I guess it's just key to ensure the property has renters, is cash flowing positive, and you can pay back that HELOC ASAP.

    Also - research cash out refinancing - you can use HELOC for down payment, get a traditional mortgage - then 6 months later you can refinance and get your cash out at 75% LTV.

    Check this - https://www.biggerpockets.com/forums/48/topics/460294-how-to-cash-out-1-4-unit-property

  • Rental Property Investor · Orange County, CA · Member since 2018 · 28 posts · 11 votes
    8y

    @junior picanco Congratulations. That is exactly what I'm looking to do as well. Thanks for your encouragement and good luck on your future endeavors.

  • Member since 2018 · 13 posts · 6 votes
    8y
    Originally posted by @Brian Cox:

    @Jason Ngo I was researching selling stock today and think I'm coming back to the HELOC. Cap gains tax and the fact that stocks should appreciate more than the interest on the HELOC. I guess it's just key to ensure the property has renters, is cash flowing positive, and you can pay back that HELOC ASAP.

    Also - research cash out refinancing - you can use HELOC for down payment, get a traditional mortgage - then 6 months later you can refinance and get your cash out at 75% LTV.

    Check this - https://www.biggerpockets.com/forums/48/topics/460...

    Thanks for the tip!  I just sent you a connection.  Lets chat through PM since we're both in similar starting points. 

  • Investor · Oceanside, CA · Member since 2017 · 78 posts · 25 votes
    8y

    Hey Good Morning @Junior Soares congrats on this on this deal ! I was curious how did you find these deals ? Where they on the MLS ? Did you do some direct mail ? Maybe some door knocking ?

  • Chicago, IL · Member since 2017 · 14 posts · 1 vote
    8y
    @Junior Picanco I would like to know if mobile homes are great investment for starters out of
  • Chicago, IL · Member since 2017 · 14 posts · 1 vote
    8y
    are mobile homes great Investments
  • Rental Property Investor · New Castle, DE · Member since 2016 · 376 posts · 158 votes
    8y

    @Jason Ngo  I'm pretty good with having to pay interest only then having a conventional to finance the remainder.  I plan on paying down the HELoC fast so I can buy another property.  Since I have no other financial options, I'm thankful to have the equity in my home to get the line of credit.  

    @Brian Cox  Thank you for sharing the podcast!  It confirms that doing a HELoC for me is the way to go!  The property I'm looking at could get good cash flow after renovating, but I need to get in there with a GC to see what the reno figures would be.

  • Rental Property Investor · Willow Grove, PA · Member since 2014 · 10 posts · 4 votes
    8y

    @Cassandra Sifford sure thing! Quick question on the HELOC - have you done any research for best places to get one in the tri-state area?

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