Hi everyone :)

[Payvand Milani]

Hi all - I'm married with one child so far, in my mid-30s. I'm an outpatient internal medicine physician here in the Bay Area. For the next 3-5 years, single income household here (wife staying home with kid(s)). Very new to real estate investing. Have participated (currently still involved in them) in two real estate syndications. Very excited about real estate investing mostly because I finally can see, through hearing about the successes of many (through podcasts etc), that it may truly be possible reach my financial goals. I am looking for both cash flow and appreciation. Cash flow probably is the priority (?) since my goal is to be able to cut down my hours for quality of life purposes. However, due to very, very high cost of living in Silicon Valley, and difficulty buying a reasonably sized home, and given I will remain in Bay Area long term most likely (family all here), also need a property appreciation strategy to some extent, too. Really excited to learn more and to speak with those (most ideally who live near me with whom I could meet up in person, but definitely not a deal breaker) who are in a similar stage or perhaps just ahead of me, from whom I can learn and feel supported by as I venture into this new world. I often feel like I cannot relate to many successful real estate investors on these podcasts as many seem to live in much more affordable parts of the country and thus have lower cost of living/mortgages/etc which really helps accelerate their success, it seems. Trying to stay positive, though! :)

[Dan H.]

Quote from @Payvand Milani:

Hi all - I'm married with one child so far, in my mid-30s. I'm an outpatient internal medicine physician here in the Bay Area. For the next 3-5 years, single income household here (wife staying home with kid(s)). Very new to real estate investing. Have participated (currently still involved in them) in two real estate syndications. Very excited about real estate investing mostly because I finally can see, through hearing about the successes of many (through podcasts etc), that it may truly be possible reach my financial goals. I am looking for both cash flow and appreciation. Cash flow probably is the priority (?) since my goal is to be able to cut down my hours for quality of life purposes. However, due to very, very high cost of living in Silicon Valley, and difficulty buying a reasonably sized home, and given I will remain in Bay Area long term most likely (family all here), also need a property appreciation strategy to some extent, too. Really excited to learn more and to speak with those (most ideally who live near me with whom I could meet up in person, but definitely not a deal breaker) who are in a similar stage or perhaps just ahead of me, from whom I can learn and feel supported by as I venture into this new world. I often feel like I cannot relate to many successful real estate investors on these podcasts as many seem to live in much more affordable parts of the country and thus have lower cost of living/mortgages/etc which really helps accelerate their success, it seems. Trying to stay positive, though! :)

 You have a high paying job as a physician.  Your wife has multiple children and a household to run.  Work life balance is valuable.

I personally believe you are on the correct path for you with passive investing of syndications.  Let the GPs do the work and you reap the reward of their hard work and their expertise.

Here are some of my thoughts about residential RE investing:

- The market is more challenging than in many years.  The combination of high price and a doubling of the interest rate results in high cost for financed RE. 

- Rents have not and cannot keep up with the cost increase of financed properties.  interest doubles raises P&I significantly.  Renters cannot afford similar rent increase.

- Even rent ready residential units with the use of a PM is not passive. Rent ready units on the MLS at small unit counts are unlikely to have positive cash flow in spite of what various mid-west RE agents and turnkey providers claim.

- Value adds are a lot of work and have risk.  I completed a rehab in mid may.  I was on site virtually every day and doing various work.

- BP just acquired a syndication forum and will be providing access soon.  Syndication research has never been easier.  GPs will either need to perform well (communication, good return, etc) or they will be challenged to get LPs.

- The best cash flow in this market is achieved via STR, MTR, or rent by room. These are even less passive than LTR if you do not use a PM. PM will take big chunk of the income and still not bring the effort to passive on your part.

- Adding an ADU is a lot of work. In SF zoned areas, they usually start with a negative equity position meaning the cost to add is more than the value added. This negative equity position will consume the initial cash flow. financing is worse than RE acquisition. First capital outlay is long before any income. The work is more than a rehab, but if i brrrr I can achieve infinite return (this is how I made most of my money in RE), but an ADU generates poor return (none until the initial negative equity position is recovered). It is expensive building small units in single count; some of the most expensive development that exists.

I have made a lot of money in RE, but it has not been passive and much of it was achieved at an easier RE market than today.  Leverage the expertise of people who can dedicate full-time effort to the success.  Sit back and enjoy the fruits of their labor.  Use the time you would be spending on residential RE to enjoy time with your family.  Sign on to the BP syndication wait list and enjoy the life that your hard work has already provided.

Good luck