San Jose, CA · Member since 2018 · 25 posts · 38 votes
Hi everyone,
This is my first post. I hope I am posting in the right place. I am a newbie to rental property ownership. I am fortunate enough to have a relative give me a substancial lump sum as a gift. She wants her heirs to enjoy their inheritance while she is alive.
I live in San Jose Califoria, and would like to buy a four plex with my recent wind fall. I don't want to buy a rental property here because it's very expensive. Nothing is priced under 1 million in Silicon Valley. I saw a fourplex in Modesto on the MLS that is located about two hours from San Jose. It is priced in the mid 300,000's. I will take my uncle who is a contractor with me, to see if it's worth purchasing.
My question is, Since I have the cash should I just buy it out right or get a loan ? I will still have a nice ammount left for savings even if I pay cash. I have family that lives in that area and would be able to check on the property for me when I'm not available. Thanks for any advice.
@Angela Holmes It all depends. I would personally leverage myself. So I would put 20% down and finance the rest. See if someone handed me a lump some of 100k, I would not go buy one 100k property. I would go buy 4 of them with 20% down. Now you have 400k worth of property.
This only works if the properties are cash flowing. Just my two cents.
@Angela Holmes
I’m from Modesto but currently live in Alameda which isn’t too far from where you live. I have property in Merced that I bought almost 10 years ago and wish I could have purchased in Modesto instead but it was out of my price range at the time. So many people commute from Modesto so I think starting your search there could be good.
I’m new to BP as well and recently my offer was accepted on a duplex in Vallejo with the basement as another potential unit in the future! I don’t believe the deal is all that great but I’m hopeful with the additional basement unit my cash flow will be much better. Im not too familiar with Vallejo but I’m sure I will be soon :) feel free to PM me
great to know jeff. Crazy to think "big city" modesto can be cheaper than turlock . I need to look into modesto more as an option. It seems like a strong renting community
@Angela Holmes congrats on your thread taking off like wild fire. I would say the first thing is to spend a little bit of it on education. Figure out what asset class you like and whether or not you want to be active. There are many many options for RE investing. I can certainly share my experience with you and help point you in the right direction.