San Francisco Bay Area · Member since 2015 · 196 posts · 181 votes
10y
hi, how have you faired in Stockton CA?
I'm scared to jump in over there, because I don't understand what drives the economy over there. And last recession it was the hardest hit around the bay by foreclosures.
Home Stager · San Luis Obispo, CA · Member since 2016 · 312 posts · 49 votes
10y
good morning abraham, welcome! newbie here too. just wished to introduce myself. formerly from washington, dc, i'm just getting started in the staging arena in california and i'm looking to make some connections as well. thanks and sincerely, sydney
Los Angeles, CA · Member since 2014 · 2k+ posts · 515 votes
10y
Hello @Abraham Bar and welcome to BP. BP has real estate investors like yourself and the best part is you can network with them and learn more about real estate investment! You've come to the right place and I wish you all the best.
Investor · Palo Alto, CA · Member since 2016 · 22 posts · 7 votes
10y
Hi Guys and Gals,
thanks for the hearty welcome. The little I have seen and learned of BP is very impressive. I own multi-family in Stockton, CA (total of 36 units), condo in Oakland and two duplexes in North Carolina (Wake Forest and Rocky Mount).
Thinking of getting out of NC, as my properties are mostly supporting the local handymen and my property manager as well as Wells Fargo rather than yours truly.
I'm mostly a cash flow buy-and-hold investor in Stockton CA. BP is opening my eyes to other strategies and opportunities. Seems I have a lot to learn.
Real Estate Agent · Concord, NC · Member since 2015 · 10 posts · 3 votes
10y
Hello, from NC. I am a buyer/investor specialist in the Charlotte/Concord area and I would love to be your person of contact here in NC. I noticed you mentioned that your NC duplexes are hurting your wallet. I am finding my investors 10 to 15% cap rates on well maintained fully rented multifamily units. Feel free to inbox me if you want to talk.
San Francisco Bay Area · Member since 2015 · 196 posts · 181 votes
10y
hi, how have you faired in Stockton CA?
I'm scared to jump in over there, because I don't understand what drives the economy over there. And last recession it was the hardest hit around the bay by foreclosures.
Residential Real Estate Broker · San Mateo, CA · Member since 2013 · 585 posts · 264 votes
10y
@Abraham Bar welcome! You have a nice sized set up compared to most people on BP and I am sure you will be a great resource for those looking to replicate your success! Hopefully you have the opportunity to make it out to one of the local BP Meetups in the near future.
Investor · Palo Alto, CA · Member since 2016 · 22 posts · 7 votes
10y
@Daniel Gonzales, Stockton is a food place to invest for cash flow . The craziness of the bay area has caused people from Oakland to seek cheaper housing in Stocktion. It's always scary for me to commit to a new acquisition, but you have to look at the numbers and talk to the people to minimize your risk.
Residential Real Estate Broker · Wilmington, NC · Member since 2016 · 46 posts · 18 votes
10y
Hello Abraham! If you have any interest in Wilmington, NC I can be of assistance. I am currently helping my Bay Area family and friends invest here. We love Wilmington, NC! Please feel free to contact me.
I'm scared to jump in over there, because I don't understand what drives the economy over there. And last recession it was the hardest hit around the bay by foreclosures.
Same here. Very interesting to hear that you've been successful out there.
Investor · Pacifica, CA · Member since 2016 · 3 posts · 0 votes
10y
Hi Everybody,
First post here:
I'm a bay area investor and intent on Stockton. The numbers are just too good.
If you look on loopnet, the only place with higher cap rates (> 9% after debt service) around the bay area is in Arizona.
It's about 50k per unit, so I'm quite excited, since was only able to afford ~4 units where I was searching.
The main worry I have, is the future of this city. It does seem promising, as many big companies are moving headquarters / offices to this town. A 4 bedroom house for 1600/month sounds too good to be true where I'm based (SF).
At the same time, there are so many abandoned / run-down properties, that I worry that if enough capital is invested, the rents and returns might actually go down.
When I went down there last weekend, it felt a really nice place to be, like time forget this city. A lot of beautiful Victorian buildings, going for ~200k, that would cost close to a million just 40 miles closer to the bay.
I love networking and discussing ideas / methods of analysis, and financing, so please do message me if you're a like-minded investor.
Also, I'll be viewing some properties in Stockton this weekend, others are welcome to join.
i.e. this takes into account the loan. If you are doing 9% after debt service on your money that's quite good.
Stockton has some really sh****y places and some really nice ones. Once upon a time it was a really thriving and prosperous place. I invest in some of the less fancy places in multi-family buildings. My logic is that you get paid more for the trouble that might be involved and that even when times are tough, at the low end, people will always need housing. The key issue is to have a good, honest, reliable manages.
I would not worry about the abandoned properties being rehabbed and coming online. This will only happen at the rate that these properties are needed to soak up additional demand as it will hopefully be created over time.
I'm a bay area investor and intent on Stockton. The numbers are just too good.
If you look on loopnet, the only place with higher cap rates (> 9% after debt service) around the bay area is in Arizona.
It's about 50k per unit, so I'm quite excited, since was only able to afford ~4 units where I was searching.
The main worry I have, is the future of this city. It does seem promising, as many big companies are moving headquarters / offices to this town. A 4 bedroom house for 1600/month sounds too good to be true where I'm based (SF).
At the same time, there are so many abandoned / run-down properties, that I worry that if enough capital is invested, the rents and returns might actually go down.
When I went down there last weekend, it felt a really nice place to be, like time forget this city. A lot of beautiful Victorian buildings, going for ~200k, that would cost close to a million just 40 miles closer to the bay.
I love networking and discussing ideas / methods of analysis, and financing, so please do message me if you're a like-minded investor.
Also, I'll be viewing some properties in Stockton this weekend, others are welcome to join.
--Tom
Hi Tom - I am really curious, what kind of properties are you looking at for 50K per door? Based on the fact that you are looking on Loopnet I am assuming they are large (20+ unit multi family properties)?
Reason I am curious is because I am in the middle of adding two duplexes and a triplex to my Stockton CA portfolio and what I am paying is more like $95K per door. I readily admit that is a "retail investing" price but I am really curious to hear what you are looking at for $50 per door. Because for "newer" (1970's+) small multi family those would be 2011-2012 prices.:))
thanks for the hearty welcome. The little I have seen and learned of BP is very impressive. I own multi-family in Stockton, CA (total of 36 units), condo in Oakland and two duplexes in North Carolina (Wake Forest and Rocky Mount).
Thinking of getting out of NC, as my properties are mostly supporting the local handymen and my property manager as well as Wells Fargo rather than yours truly.
I'm mostly a cash flow buy-and-hold investor in Stockton CA. BP is opening my eyes to other strategies and opportunities. Seems I have a lot to learn.
Cheers
Hi Abraham - Welcome to BP! You'll find lots of good stuff on there and if you have not already, definitely check out the BP Podcasts! While they don't go into much depth I find them eyeopening because they cover a wide range of real estate techniques and if you can gloss over the rah-rah there are even pretty entertaining.
BTW; that is quite the portfolio you have there! Your units in Stockton CA, are they individual Duplex/Triplexes, or or one apartment complex? If the latter, I'd be very interested to hear how that is working out for you and how the numbers for those types of properties look as that is I what I currently think I want to migrate into. If its the former (duplexes/triplexes) we could be "neighbors" somewhere already:).
Investor · Stockton, CA · Member since 2015 · 14 posts · 2 votes
10y
@Abraham I'm curious about the units you find at 50k per door also. I'm currently searching for a 4-plex and the few that I have found at that price I probably couldn't get financing for they need so much work. Most of what I have seen have been on the MLS mind you. Is there someone you work with in the area?
i.e. this takes into account the loan. If you are doing 9% after debt service on your money that's quite good.
Stockton has some really sh****y places and some really nice ones. Once upon a time it was a really thriving and prosperous place. I invest in some of the less fancy places in multi-family buildings. My logic is that you get paid more for the trouble that might be involved and that even when times are tough, at the low end, people will always need housing. The key issue is to have a good, honest, reliable manages.
I would not worry about the abandoned properties being rehabbed and coming online. This will only happen at the rate that these properties are needed to soak up additional demand as it will hopefully be created over time.
Investor · Palo Alto, CA · Member since 2016 · 22 posts · 7 votes
10y
I own a 12 plex that I bought in 2013 and a 24 plex in Lodi that I bought in 2015. I have a local person who is taking care of the properties since I live quite far but I also actively manage . My cap rates are 12% and 8.5% respectively. I bought for $37.5K and $66K per door respectively.
I'm a bay area investor and intent on Stockton. The numbers are just too good.
If you look on loopnet, the only place with higher cap rates (> 9% after debt service) around the bay area is in Arizona.
It's about 50k per unit, so I'm quite excited, since was only able to afford ~4 units where I was searching.
The main worry I have, is the future of this city. It does seem promising, as many big companies are moving headquarters / offices to this town. A 4 bedroom house for 1600/month sounds too good to be true where I'm based (SF).
At the same time, there are so many abandoned / run-down properties, that I worry that if enough capital is invested, the rents and returns might actually go down.
When I went down there last weekend, it felt a really nice place to be, like time forget this city. A lot of beautiful Victorian buildings, going for ~200k, that would cost close to a million just 40 miles closer to the bay.
I love networking and discussing ideas / methods of analysis, and financing, so please do message me if you're a like-minded investor.
Also, I'll be viewing some properties in Stockton this weekend, others are welcome to join.
--Tom
Hi Tom - I am really curious, what kind of properties are you looking at for 50K per door? Based on the fact that you are looking on Loopnet I am assuming they are large (20+ unit multi family properties)?
Reason I am curious is because I am in the middle of adding two duplexes and a triplex to my Stockton CA portfolio and what I am paying is more like $95K per door. I readily admit that is a "retail investing" price but I am really curious to hear what you are looking at for $50 per door. Because for "newer" (1970's+) small multi family those would be 2011-2012 prices.:))
Hi Chris,
Mostly the downtown Stockton area, here's an example:
623 N Edison St Stockton $1.195m, 22 units, 144k gross, Built 1950.
That would be ~55k / door, and this is also retail.
The rents for 1/1 are in the 500-600 range.
The biggest advantage is less competition on commercial properties, many RE investors are uncomfortable with commercial, as everything is different, and lending is a big challenge.
I'm quite curious about your rent increases in the past, steady increase, and what are your projections for the future?
i.e. this takes into account the loan. If you are doing 9% after debt service on your money that's quite good.
Stockton has some really sh****y places and some really nice ones. Once upon a time it was a really thriving and prosperous place. I invest in some of the less fancy places in multi-family buildings. My logic is that you get paid more for the trouble that might be involved and that even when times are tough, at the low end, people will always need housing. The key issue is to have a good, honest, reliable manages.
I would not worry about the abandoned properties being rehabbed and coming online. This will only happen at the rate that these properties are needed to soak up additional demand as it will hopefully be created over time.
Feel free to connect any time..
Abraham.
Abraham,
Appreciate your input, I'm currently doing more market research, and it looks like Stockton might actually lead job-growth in CA this year. (1)
I'm still new to the game, and use cap rate w / debt service, because comparing COCR is sensitive to the DownPayment / financing, whereas CAP / w debt is much less so, even though it breaks the definition.
Is there a better metric, or maybe the mechanics of its use is still not 100% for me, would appreciate any feedback.
With some of these COCR returns, you could break even in 3 years, granting an infinity return after that. I'm with you completely on the needing housing, and even in 2007, rents in the bay area, or anywhere, almost never go down. I'm good with 20%+ COCR even if the housing market is slow.
Sounds like you've had a positive experience in Stockton so far, maybe we should start a Stockton thread?