Ready to get my feet wet

18 Replies

Hi BiggerPockets community!

My name is Gaby and I m current reside in Irvine, CA,

Absolutely love this site and the content they post. I've recently started to search the information regarding rental properties.

I’m having a full time job and absolute love it, but I also want to invest my money on real estate and gain passive income, Buy and hold for long term. maybe I would become a full-time investor in the future, who knows?

I’m thinking of starting invest out of state since CA is too hard to cash flow.

My purchasing price is about $500k properties.

Still try to figure it out should I buy SF or MF, I have looked some turnkey companies they only have SF.

If I want to invest MF where should I look into?

SF or MF as a new investor?

That's just a bit of where I'm at right now and I can't wait to network with the community further!

Please excuse my grammar, English is not my first language 😊

Liu Gaby, I can relate to you I live in San Bernardino county and the prices are going up. In regards to buying SF or Multi Unit depends on the deal that is presented to you. Have you check BP real estate listing. They have a lot of SF, Multi unit property investment. If you get a multi unit you will have to pay 20 to 25 percent down. Which means $100,000 to $125000 dollars down. But you will have a better tax credit and opportunity to add value. It just depends where you find the deal and if it makes sense. BP Brandon Tunner and David Greene have podcast and youtube videos you can watch to educate you better.

@Adekunle llori , thanks for your reply ,i m thinking of investing in Middle west through turnkey company, what do yo think? since i dont have time to do the rehab and PM,i listen to BP podcast,educated me lot. i really need to get in the game.

@Liu Gaby  Welcome to BP here in Orange County, California.  My suggestion before you run out of state is maybe to attend some local meetup groups and speak with investors who are doing what you propose.  It's always best to speak with someone in person that has been successful, instead of reinventing the wheel.

I you are just going to buy turnkey properties then you may be missing the point of investing.  You should be looking for more distressed properties that you can "value add" to make more money right away.  Help and education is here locally for you and then you can venture out to other states if you don't have enough cash for California.

Good investing...

Originally posted by @Liu Gaby:

Hi BiggerPockets community!

My name is Gaby and I m current reside in Irvine, CA,

Absolutely love this site and the content they post. I've recently started to search the information regarding rental properties.

I’m having a full time job and absolute love it, but I also want to invest my money on real estate and gain passive income, Buy and hold for long term. maybe I would become a full-time investor in the future, who knows?

I’m thinking of starting invest out of state since CA is too hard to cash flow.

My purchasing price is about $500k properties.

Still try to figure it out should I buy SF or MF, I have looked some turnkey companies they only have SF.

If I want to invest MF where should I look into?

SF or MF as a new investor?

That's just a bit of where I'm at right now and I can't wait to network with the community further!

Please excuse my grammar, English is not my first language 😊

 Welcome to the site Liu. My advice would be to stick with single family or small multifamily at 1st. This means 2-4 unit properties. 2-4 unit properties are in my opinion the best investments for newer investors as they still qualify for 30 year residential financing but you get 2x-4x the rental income checks. Lots of those types of properties available in the Midwest. Check in with Property Management Companies operating in the markets you are interested in. To be a Property Management Company they've got to be a Brokerage so they can sell you properties as well.

@Joe Homs  thanks for you advise ,yes I have looked some local RE investor meet ups and will begin to attend to educate myself more. I have looked on loopnet that the Multi family properties in Los Angeles ,the lowest price is above 570k 4 units and requires 250k down by talked to one lender, with a net $4500 cash return a year ,I don't see thats a good cash return investment.so i may have to look out side of CA.

@James Wise  Yes,I feel like I m gonna start to with a single family house and to see how it goes, I'll check out your website.

你好!

Welcome to BiggerPockets!

I'm Ryan Huynh, and I'm from Kansas City, MO. Here in the Midwest, properties get solid cash flow and I think the market is much more accessible here than in Southern California. David Greene of BP has a book on long distance real estate investing, so you might want to check that out, though I personally have not read it yet. And I do agree with James- single family and small multifamily will be easier to manage early on, especially if you are looking at an out of state investment. Those are my two cents. If you're interested in learning more about the Kansas City market, we can connect. Good luck to you on your real estate journey!

Originally posted by @Liu Gaby:

@James Wise I looked some Cleveland property on BP market place , there are some cash on cash more than 20% , really ? Or I miss something?

 You could be maybe. Cleveland, like the rest of the Midwest has a ton of low cost real estate with high price to rent ratios but don't think it's the land of milk and honey or anything. Some deals are great but some are fool's gold. Just like any market out there you can make money if you know what you are doing and you can loose money if you don't know what you are doing. If you are looking at pro-forma's with super high returns you've got to check out the level of the neighborhood. For that I created The Ultimate Guide to Grading Cleveland Neighborhoods. The D and F neighborhoods really get people's attention on those pro-forma's but I caution brand new out of state investors who are thinking about starting there. It's really a savage game that is best left to local or more experienced operators. Investing there is more like entering a war than it is providing housing lol.

Here is my out of state punch list that I try to give out to new out of state investors whenever possible.

  • Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
  • Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
  • Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
  • Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
  • Make sure your property manager is a licensed real estate brokerage.
  • Understand you can not eliminate all risk, only mitigate it. If you are risk adverse real estate, (especially out of state) is not for you.

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