Sensible investing in California Real Estate?
After 30 years of working my *** off to get an extra percent or two in the stock market, I've finally realized that I should be investing in real estate.
Better late than never.
First of all, Thank You to all the posters, formum-ers, podcasters, and writers on this site. You've helped jump start my education in real estate investing.
Who I am...
- 50 years old.
- Wonderful wife and 2 small children.
- Decades in the high tech field (IT security).
- Self-employed for the past 15+ years with my own business with an excellent partner.
- Lots of experience on large projects in the software / IT world... and had enough of it.
What I've learned so far...
- I'm not a flipper or wholesaler or other exciting things. I'm pretty much what I was with stocks - a long term, buy-and-hold investor.... Woo Hoo, income and long term capital appreciation!
- I am interested in solid cash flow plus reasonable appreciation (aren't we all?).
- I am mostly interested in multi-unit residential and commercial properties.
- I will probably be "hands off" - using property managers for properties.
- I'm not interested in "turn key" deals unless I do the key-turning.
My challenges...
- I live in the San Francisco Bay area. I don't own my house and, given the market here, that isn't happening any time soon.
- California real estate is (cough) rather fully priced as a whole.
- I would like to be able to visit the properties that I buy, especially at first. Without getting on a plane, a train, or spending a day or more driving.
Where I'm at....
- I've found my initial market here in California with what I consider reasonable cash flow and appreciation.
- I am (initially) looking at 4-plexes and more-plexes as well as smaller mixed commercial/residential properties. These properties seem the most inefficiently priced as they are too big for residential purchasers and too small for big money dudes... more on this later.
- I have several properties in my target market that I like. I am getting pre-approved so I can write an offer.
- I am also going to set up an IRA LLC (Roth) soon to purchase properties as well (I've been a good boy an put money aside for years and done pretty well in stocks)... more on this later as well.
Observations...
- This stuff is fun. It is like researching stocks but not having thousands of other people doing the same thing you are. Less competition = more opportunity.
- You start saying you are investing in real estate and all of a sudden, people want to talk to you about it... hello syndication at some point.
- Finding small commercial loan providers seems to be a challenge (also more on this later). Everybody wants to help me finance a 150 unit deal. I look forward to that too!
Glad to meet you all. Happy hunting.