Bay Area new member

12 Replies

Hi

I joined BP recently and wanted to introduce myself.

Moved to bay area in 2014 from NYC and bought a  home for primary residence . Based on recent sales prices , it appears that our property has appreciated about 250K and it doesn't feel as stressful now about putting all of my savings into this purchase.

The other property that I have is a single family rental in the Sacramento area that we bought in early 2012 when the market was still down and looks like it has appreciated about 150K appreciation.

Monthly rent: ~$2000 (cashflow positive after mortgages, taxes and other maintenance expenses by $100 /month)

I have another 150K in various real estate crowd funding deals that are giving me 10-15 % returns.

I am looking to understand more about real estate investing and  opportunities for buy and hold rental properties with moderate risk.  

Cheers

Sunny

@Sunny D. Welcome! Looks like you hit a jackpot in that market! It looks to me like you could be teaching others how to invest. 

BP is a great site to learn, and network with other investors. You might want to do a search and see if there's any meetups, etc. in your area. 

Good luck! 

Grats on your success in the Bay Area of late @Sunny D. .

From the financials I've seen of my clients in our area, it appears to me that local multi-unit are the most consistent winners. Keep in mind that what I am mostly looking at is tax returns (that include maintenance expenses, small/normal and large/unexpected), leases, and PITI. Whatever happens "off the record" and outside of paperwork, I do not see.

Condos were good if you could see the future and hardcore time the market, otherwise (and in general IMO) meh.

SFR in our area, some win and some lose - depends on how well you purchased. I've not noticed any strong "buy in the hood" or "buy in middle income areas" or "buy in nice areas" patterns either way. There are deals to be found there, but no patterns that stick out from what I have seen.

By contrast however it's very rare that I see a multi-unit that ended up as a loser according to tax returns a year or two down the line. The last loser multi-unit I saw was a slowly collapsing 100 year old Victorian triplex conversion wherein someone decided to skip inspections, other than that it's winner-winner-winner-winner for multi-units in our area over the last few years.

I'm sure I don't have to tell you: know your rent control laws, if applicable, where you are buying!

Also keep in mind that the 50% rule is (in my opinion) more conservative for our market than others, as it was made by and for folks that do not have prop 13. 

Originally posted by @Chris Mason :

Grats on your success in the Bay Area of late @Sunny D..

Thanks Chris will read a bit more on the 50% rule. How much cash do you think I should have if I want to look at a multi unit?

>>

Also keep in mind that the 50% rule is (in my opinion) more conservative for our market than others, as it was made by and for folks that do not have prop 13. 

Originally posted by @Sunny D. :
Originally posted by @Chris M.:

Grats on your success in the Bay Area of late @Sunny D..

 How much cash do you think I should have if I want to look at a multi unit?

>>

I just popped open Redfin, searched Vallejo, looked at multi unit listings and multi units that closed within the last 6 months (recognize two that I worked on :)... I'm gonna say $65k out of pocket is about the minimum that will get you in the door and in the multi-unit game if you're cool with that town (that town was an arbitrary pick based on what is in my recent memory).

Might be a little bit of a drive to landlord from Pleasanton, but you're already doing it in Sac so you could stop by whenever landlording brings you to Sac.

Thanks Chris, appreciate the response, I should be able to have that much cash to work with. In gen. if I am able to get 10%+ cash on cash returns with some of the crowd funding deals, is it worth going through all this effort and look to jump in when the market corrects again or do you feel multi units with net positive cashflow will achieve higher returns long term. 


Originally posted by @Chris Mason :
Originally posted by @Sunny D.:
Originally posted by Chris Mason:

Grats on your success in the Bay Area of late @Sunny D..

 How much cash do you think I should have if I want to look at a multi unit?

>>

I just popped open Redfin, searched Vallejo, looked at multi unit listings and multi units that closed within the last 6 months (recognize two that I worked on :)... I'm gonna say $65k out of pocket is about the minimum that will get you in the door and in the multi-unit game if you're cool with that town (that town was an arbitrary pick based on what is in my recent memory).

Might be a little bit of a drive to landlord from Pleasanton, but you're already doing it in Sac so you could stop by whenever landlording brings you to Sac.

Originally posted by @Sunny D. :
Thanks Chris, appreciate the response, I should be able to have that much cash to work with. In gen. if I am able to get 10%+ cash on cash returns with some of the crowd funding deals, is it worth going through all this effort and look to jump in when the market corrects again or do you feel multi units with net positive cashflow will achieve higher returns long term. 

 Why are you doing the crowdfunding thing?

And I'm not going to claim to have any insight into the future. :)

Crowd funding - realtymogul/ifunding/patchofland seems simpler, I can diversify and also have some one else deal with the property . 

@Sunny D. It sounds like your off to a great star with buying when the market was low. You will learn even more here on gp and meet other like minded people.

The real estate market in the Midwest has not gone way up like CA so there are still opportunities for good cash flow in those states.

Welcome Sunny! You have definitely come to the right place to increase your real estate investing knowledge.

Great job on your two purchases. Timing can make all the difference in the world when investing and you purchased at a great time. Well done.

I wish you the best in building up your real estate portfolio.

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