New San Francisco bay area investor wanna-be

New San Francisco bay area investor wanna-be

Petaluma, CA · Member since 2017 · 106 posts · 86 votes

Hey all! Super excited to be here. The more I dive into the forums and information of BP, the more addicted I become to this ever growing vision of what my family could enjoy 5-10 years down the line.

My name is Jason Howell and I currently live in Petaluma, California with my wife. We own a home in Petaluma, partially cause Petaluma is awesome. But also cause the bay area is freaking expensive, and we could actually afford to buy here (but hey, it's Sonoma county so WINE EVERYWHERE)… which we did two years ago, and it almost immediately appreciated significantly. So hey, through dumb luck, we did something right.

No real background in real estate (yet) other than owning our home. I work in the tech podcast industry and my wife in fitness. But what we really want more than anything right now is to invest in real estate in a way that allows us to ensure that we have some sort of solid retirement to enjoy when the time is right. We are both in our early 40’s and realizing that 401k simply won’t be cutting it. So we have to take things more into our own hands.

BP podcast and Investing in Real Estate podcasts have lit a nice fire under our butts. Also reading a ton of the usual books to get nice and educated. We’ve begun meeting regularly with some other bay area friends who are also embarking on this journey so at least we have some other minds to tap when needed. But as you would agree, the more the merrier. Especially at this critical starting point stage we are in. We're intrigued but also a bit gun shy cause sometimes you don't know what you don't know, ya know?

Turn key sounds nice to me. To be honest, I’d love to do the work to figure out creative ways to fund the purchase of properties and then let someone else manage them. We both work full time jobs and have two young children (3 and 7 yo girls) so the last thing I need is something that demands all of my off-work hours. A little, sure. But not all of it. But you know, it’s a lot of money. So we want to be sure we’re doing it right.

And eventually, who knows. I could seriously consider transitioning my life towards something more entrepreneurial like this down the line but only when I feel super confident in my ability to parse it, live the language, and strike a balance with my wife as a team in the process. We’re both driven by the idea of creating legacy wealth and passive income to make our lives better in the long run. That is what its all about for us.

Nice to meet you all! I realize this was a wall of text, but hopefully not too much to manage. Looking forward to learning and sharing with you all in the coming months/years.

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Investor · San Francisco, CA · Member since 2016 · 16 posts · 23 votes
9y

Hi Jason ! I've been a big fan of Twit for years and the whole team in Petaluma. I'm in SF and grew up in the Bar Area. 

Please PM me if you want info on out-of-state investing. I have 8 units in Indianapolis that are going well. 

Let's talk,

Christian 

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  • Trexie E.Pro Member
    BiggerPockets Support · Davao, Davao del Sur · Member since 2015 · 937 posts · 163 votes
    9y

    Hi @Jason Howell

    Welcome to BP! I know you will have great success with this in the forums. Please don't hesitate to reach out if you have any questions or clarifications. We are always happy to help!

    BiggerPockets
  • Chris MasonPro Member
    Moderator
    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    9y

    Welcome, @Jason Howell.

    I was up in Sonoma County during my high school years, but not so much wine available to me at that point in my life. :)

    The greater Bay Area crew is super helpful and active, don't hesitate to reach out to anyone.

  • Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
    9y

    Hello @Jason Howell!

    I'm in CA also as well, in Los Angeles. I have visited Sonoma County several times and really love it there , really beautiful area and of course some amazing wine! BP is definitely a great resource. CA property is expensive for sure but it can appreciate nicely too. You are right that one can't really depend on a 401k for retirement. I feel the real estate investing offers a lot more potential to create wealth and gives one more control versus the stock market. 

    I have seen a lot of people start out with little and become wealthy in real estate but not too many in the stock market..unless they are taking their own company public.. or they start a hedge fund..which is a lot different!

    Best of luck in your real estate investments!

  • Investor · San Francisco, CA · Member since 2016 · 16 posts · 23 votes
    9y

    Hi Jason ! I've been a big fan of Twit for years and the whole team in Petaluma. I'm in SF and grew up in the Bar Area. 

    Please PM me if you want info on out-of-state investing. I have 8 units in Indianapolis that are going well. 

    Let's talk,

    Christian 

  • Investor · Napa, CA · Member since 2016 · 82 posts · 42 votes
    9y

    @Jason Howell

    There is a great network of investors in the North bay area. It is a wonderful area to start, but very expensive. Deals are out there though.

     Let me know if you need anything! 

    Jack

  • Professional · Carlsbad, CA · Member since 2012 · 12k+ posts · 1k+ votes
    9y

    @Jason Howell

    You have come to the right place to connect with the wide array of real estate professionals and investors. Make sure to view the Bigger Pockets book store: https://www.biggerpockets.com/store

  • Petaluma, CA · Member since 2017 · 106 posts · 86 votes
    9y

    Hey @Mark Nolan @Jackson Carr @Christian Ritter @Joseph M. @Chris Mason @Trexie E.

    Thanks for the warm welcome! Everybody talks about how great the BP community is so I'm super happy to eek my way in there to be a part of it. Of course I stand to learn a lot from all of you and that mountain of information is intimidating for a newbie investor, but we're pretty determined to make it happen and I'm trying to act now instead of putting anything off. Get our feet wet so we can start learning by doing. I'm sure that comes with pitfalls and that's part of the game.

    I should also clarify: Bay Area investing is outside our scope. It's just too damn expensive around here and we don't have the capital to get that going. I'm definitely narrowing in on out of state investing in less expensive areas... part of why turn key sounds so appealing. Put my money to work but let someone else manage it.

    @Christian Ritter: What you have going (I've read some of your other posts) is right up our alley. Would love to chat with you about it sometime. It sounds like our backgrounds and purposes are closely matched. PM'd you. :)

    Anyways, thanks for making a guy feel welcome! Back to the rat race (for now....)

  • Solo 401k Expert · Anaheim Hills, CA · Member since 2012 · 18k+ posts · 6k+ votes
    9y

    @Jason Howell

    Welcome to the BP family! Here are some recommendations for you:

    Find and connect with other BP members that are in your area: http://www.biggerpockets.com/meet
    Set up keyword alerts to be notified of the topics that interest you: http://www.biggerpockets.com/alerts
    Read Beginner’s Guide: http://www.biggerpockets.com/real-estate-investing
    Check out BP Podcasts: http://www.biggerpockets.com/renewsblog/category/podcast/

    Wishing you the best!

  • Equity Raiser and Turnkey Provider · Cleveland, OH · Member since 2016 · 4k+ posts · 1k+ votes
    9y
    Originally posted by @Jason Howell:

    Hey all! Super excited to be here. The more I dive into the forums and information of BP, the more addicted I become to this ever growing vision of what my family could enjoy 5-10 years down the line.

    My name is Jason Howell and I currently live in Petaluma, California with my wife. We own a home in Petaluma, partially cause Petaluma is awesome. But also cause the bay area is freaking expensive, and we could actually afford to buy here (but hey, it's Sonoma county so WINE EVERYWHERE)… which we did two years ago, and it almost immediately appreciated significantly. So hey, through dumb luck, we did something right.

    No real background in real estate (yet) other than owning our home. I work in the tech podcast industry and my wife in fitness. But what we really want more than anything right now is to invest in real estate in a way that allows us to ensure that we have some sort of solid retirement to enjoy when the time is right. We are both in our early 40’s and realizing that 401k simply won’t be cutting it. So we have to take things more into our own hands.

    BP podcast and Investing in Real Estate podcasts have lit a nice fire under our butts. Also reading a ton of the usual books to get nice and educated. We’ve begun meeting regularly with some other bay area friends who are also embarking on this journey so at least we have some other minds to tap when needed. But as you would agree, the more the merrier. Especially at this critical starting point stage we are in. We're intrigued but also a bit gun shy cause sometimes you don't know what you don't know, ya know?

    Turn key sounds nice to me. To be honest, I’d love to do the work to figure out creative ways to fund the purchase of properties and then let someone else manage them. We both work full time jobs and have two young children (3 and 7 yo girls) so the last thing I need is something that demands all of my off-work hours. A little, sure. But not all of it. But you know, it’s a lot of money. So we want to be sure we’re doing it right.

    And eventually, who knows. I could seriously consider transitioning my life towards something more entrepreneurial like this down the line but only when I feel super confident in my ability to parse it, live the language, and strike a balance with my wife as a team in the process. We’re both driven by the idea of creating legacy wealth and passive income to make our lives better in the long run. That is what its all about for us.

    Nice to meet you all! I realize this was a wall of text, but hopefully not too much to manage. Looking forward to learning and sharing with you all in the coming months/years.

     Hello and welcome! Best of luck to you out there!

  • Professional · San Francisco, CA · Member since 2014 · 876 posts · 301 votes
    9y

    Welcome @Jason Howell, best of luck with your REI goals!

  • Real Estate Agent · Phoenix, AZ · Member since 2016 · 738 posts · 1k+ votes
    9y

    Hi @Jason Howell! Welcome to Bigger Pockets! You're in the right place! :-)

    Here's a Simple 3-Step Plan you can follow if you're looking to invest out of state:

    1. Online Research: The first step is to start wide and research the various markets that match your investing goals. Read about them on Wikipedia, City-Data, Local Newspaper, Local Business Journals, etc. To take it a step further you can research zip code demographics, local crime data, schools and education, and job growth. Then you can hop into the local forums here and ask some local investors their opinions about the market and investing opportunities. Browse around on Realtor.com and get familiar with the price points and available properties, and virtually 'drive' the neighborhoods with Google street view. This will be the most time intensive step as you will have to do this for multiple markets before deciding on your top 3-5 before moving onto step 2.
    2. Contact Local Professionals: The second step is to talk with local experts, namely real estate agents. Your best bet is posting in the local forums here and asking for recommendations, as that agent is more likely to understand your real estate investing goals and can better serve your needs. Don't hesitate to start working with several of them either. Being so far apart it'll be more difficult to establish a connection, and ultimately one of them will set themselves head and shoulders above the rest. But frankly, if you do Step 1 correctly you'll likely know more about the market than they will. Just a matter of fact. But the local agent will be able to give you context about the data you've read. They're out in the market talking with clients and the public, and can give you the word on the street about the various neighborhoods, developments, local news, etc.
    3. Visit the Market: Step 1 and 2 should help you narrow the selection down to 1-2 markets, and now it's time to take the final step and visit the market in-person. Try to plan a week vacation so you really have time to examine the city, as you'll have a lot to do while you're in town. You need to meet up with your agent or turn-key provider and look at as many properties as possible. Meet with local property managers and interview them. Knock on the doors and talk to the neighbors about the area. Visit the local hot-spots and talk to every single person you meet and you can just tell them you're thinking of moving to the area and asking them what the town is like. People LOVE to give their opinion and pretend the expert, so you're learn a ton about the city, neighborhood, and local culture. And if all seems well, buy something! :-)

    But, you might actually be surprised to learn that investing opportunities are a closer than you think. I've written fairly extensively about the Sacramento and Central Valley Markets and what kinds of multifamily investments are available there. 

    It's great for Bay Area investors since it's only a couple hour's drive and much closer to home than something that's several states away. New investors particularly like the idea of being able to "drive and look" at their property :-) Here's some posts to help you explore that direction if you're interested:

    Best of luck!

  • Realtor · Rocklin · Member since 2016 · 128 posts · 67 votes
    9y

    Hey @Jason Howell!  Welcome to BP!  Sounds like you have educated yourself pretty well, now the hard (and scary part) is taking action!!  I have done two out of state deals, but I'm feeling the pull to start doing more local deals.  Good luck, and I'll see you around BP.  

  • Investor/RE Broker · Eugene, OR · Member since 2014 · 3k+ posts · 968 votes
    9y

    @Jason Howell Hi and welcome to BP! It sounds like you are doing some good preliminary thinking. I have been a turnkey investor myself for several years and one REI alternative to turnkey, and even more passive and lower risk via diversification I found I wrote about quite extensively:

    Have I Found the Holy Grail of Passive Real Estate Investing?

  • Real Estate Investor · Kansas City, MO · Member since 2015 · 222 posts · 121 votes
    9y

    Welcome! I'm in KC turnkey if you need anything here!

  • Specialist · Indianapolis, IN · Member since 2014 · 670 posts · 352 votes
    9y
    Jason Howell your off to a great start with educating yourself. Having your kids myself when I started investing I focused on more passive investing which allowed me to learn while still earning a return. Many opportunities out there from investment funds, turnkey investing, value add, multifamily and fix and flip to name a few. There's a few pitfalls with turnkey so just make sure you do your due diligence.
  • Clayton MobleyPro Member
    Birmingham, AL · Member since 2014 · 875 posts · 947 votes
    9y

    @Jason Howell Welcome to BP! I will definitely second the points made by @Wes Blackwell and @Jeff Wallenius. As Wes pointed out, research is the key - but you already knew that. Start big and whittle down. Sounds like you and your wife have already had some discussions about the three key things I always tell new investors to consider: time, control, and risk. 

    You've already come to grips with the time/energy constraints you have, which weeds out more hands-on REI like flipping etc. Sounds like you're more than ok with letting someone else manage your investment and/or investing out of state, which takes care of the control question. A lot of people are in your position (being in pricey places like CA, NY or HI) but the psychological hurdle of not being able to see the investment regularly can be big for some people. In terms of risk, leverage is one kind - and can be used to amazing effect if used properly, so make sure you consider the amount of leverage you're comfortable with and explore how it could help you build a portfolio more quickly. However, since you're already considering turnkey, the primary risk factor you are going to encounter is PEOPLE.

    As Jeff rightly pointed out, there can be some serious problems in TK. Primarily because that terms has become sort of a 'big tent' for a number of different strategies that are similar, but not the same. Look out for people who claim to be TK but actually just advertise props owned by other companies, for example. Also, know the difference between TK companies that do everything in house and those that contract out various tasks. The greater the number of moving parts, the more work you need to do to ensure everyone on your team is on the up-and-up.

    Obviously, I love TK, but that doesn't mean that it's all roses. Firstly, anyone that tells you it's effortless is straight up lying to you. Yes, once you've made the investment, you shouldn't have to do much - you pay the TK company to vet tenants, deal with maintenance issues etc., that's the whole point of going the TK route. But BEFORE you cut the check, there is one heck of a work load. Any time you have to rely on another person to make your investment successful, you have to dig deep to ensure you find someone you can trust. With turnkey, you're trusting a group of people with basically every aspect of the investment, not just rehab or management - all of it. Your due diligence should be commensurately thorough. 

    I certainly don't mean to put you off TK, but I think a lot of the bad wrap the niche gets is due (in part) to people being told that all TK is created equal and that it is the 'easy' investment. Uneducated investors take that at face value and just throw their money at the operation that shouts the loudest or shows the best numbers, without checking to see how those numbers are calculated and where that data comes from. Of course, the other side of that coin is that there are a lot of people calling themselves Turnkey that are simply dishonest, making your due diligence the most important work of all. 

    Turnkey can be an amazing investment, and is particularly well suited to people in your situation (busy, full-timers in pricey markets), but you have to put in the work. As Wes noted, going to visit a team you're considering is a fantastic way to either gain peace of mind or weed out a scammer, so consider shelling out a few hundred bucks and visiting any TK provider that makes it to your short list - you'll be glad you did.

    Ok, that's my own wall of text for you ;) I blah blah about this a lot, but if you are still considering TK, here's a link to a post I wrote a while ago for another CA investor. It includes a list of questions any new investor should be asking of any TK provider they consider. Hopefully it will be helpful to you in your research.

    https://www.biggerpockets.com/forums/55/topics/361999-new-investor-from-glendale-ca

    If you have any questions about TK or the Birmingham, AL market, feel free to shoot me a note any time.

    Best of luck!

    Clayton

  • Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
    9y

    Welcome to the site @Jason Howell

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