Beginner investor from San Jose, CA

54 Replies

Hey everyone, my name is Kenny Schumacher and I'm a new investor living in San Jose, CA. I purchased my first residential rental property in Huntsville, AL in May 2019, which was initiated after meeting an investor during jury duty (funny story).

I'm 25 years old and graduated from Loyola Marymount University, with degrees in accounting and finance. I interned my junior year summer at a public accounting firm, which helped me finalize my decision that accounting (as well as having a "real job") wasn't for me. Instead, I pursued entrepreneurship, started some businesses, sold one, and am managing a few others.

Due to work, I don't have too much free time. But when I'm not working, I love staying active and exercising, exploring food spots, anime, and abusing AMC's A-List.

The idea of passive income, as well as making your money work for you through investing, really excites me. As it's difficult to find a positive cash flowing property in most of California, I decided to look elsewhere, and stumbled upon Huntsville by chance. I was fortunate enough to find a good realtor and property management company, and am planning on purchasing additional properties in the near term future. Should things settle down a bit and I get more time, I'd love to explore flipping too.

The easiest solution would be to continue investing in Huntsville, as everything is already setup for me there. However I would like to explore other cash flow generating opportunities (maybe Cleveland, OH?). A friend who started investing in real estate around the same time as me referred me to BiggerPockets, and it looks like a great community that I would love to be a part of!

Thanks for your time, and I'm looking forward to connecting with you all!

@Kenny Schumacher welcome to BP!! It sounds like you have some very exciting things in the works!! I love Cleveland for cash flow I may be slightly biased since I was born and raised here but hey, it's working for some really big players in town. I am also an investor purchasing apartment buildings throughout Cleveland. Happy to help however I can!

Originally posted by @Kenny Schumacher :

Hey everyone, my name is Kenny Schumacher and I'm a new investor living in San Jose, CA. I purchased my first residential rental property in Huntsville, AL in May 2019, which was initiated after meeting an investor during jury duty (funny story).

I'm 25 years old and graduated from Loyola Marymount University, with degrees in accounting and finance. I interned my junior year summer at a public accounting firm, which helped me finalize my decision that accounting (as well as having a "real job") wasn't for me. Instead, I pursued entrepreneurship, started some businesses, sold one, and am managing a few others.

Due to work, I don't have too much free time. But when I'm not working, I love staying active and exercising, exploring food spots, anime, and abusing AMC's A-List.

The idea of passive income, as well as making your money work for you through investing, really excites me. As it's difficult to find a positive cash flowing property in most of California, I decided to look elsewhere, and stumbled upon Huntsville by chance. I was fortunate enough to find a good realtor and property management company, and am planning on purchasing additional properties in the near term future. Should things settle down a bit and I get more time, I'd love to explore flipping too.

The easiest solution would be to continue investing in Huntsville, as everything is already setup for me there. However I would like to explore other cash flow generating opportunities (maybe Cleveland, OH?). A friend who started investing in real estate around the same time as me referred me to BiggerPockets, and it looks like a great community that I would love to be a part of!

Thanks for your time, and I'm looking forward to connecting with you all!

Welcome to the site, Kenny! I also live in CA, and I have been investing in the Cleveland area for years! I've gathered a ton of information on investing in the Cleveland area, and would be happy to share it if you are interested. It includes, among other things, a comprehensive map of the Cleveland area, grading each area from A+ down to F, using a consistent, objective and transparent methodology using publicly available data, and overviews of some of the areas that are most popular with investors. Feel free to drop me a private message!

Originally posted by @Kenny Schumacher :

Hey everyone, my name is Kenny Schumacher and I'm a new investor living in San Jose, CA. I purchased my first residential rental property in Huntsville, AL in May 2019, which was initiated after meeting an investor during jury duty (funny story).

I'm 25 years old and graduated from Loyola Marymount University, with degrees in accounting and finance. I interned my junior year summer at a public accounting firm, which helped me finalize my decision that accounting (as well as having a "real job") wasn't for me. Instead, I pursued entrepreneurship, started some businesses, sold one, and am managing a few others.

Due to work, I don't have too much free time. But when I'm not working, I love staying active and exercising, exploring food spots, anime, and abusing AMC's A-List.

The idea of passive income, as well as making your money work for you through investing, really excites me. As it's difficult to find a positive cash flowing property in most of California, I decided to look elsewhere, and stumbled upon Huntsville by chance. I was fortunate enough to find a good realtor and property management company, and am planning on purchasing additional properties in the near term future. Should things settle down a bit and I get more time, I'd love to explore flipping too.

The easiest solution would be to continue investing in Huntsville, as everything is already setup for me there. However I would like to explore other cash flow generating opportunities (maybe Cleveland, OH?). A friend who started investing in real estate around the same time as me referred me to BiggerPockets, and it looks like a great community that I would love to be a part of!

Thanks for your time, and I'm looking forward to connecting with you all!

Hello and welcome! Best of luck to you! 

 

@Kenny Schumacher

Welcome to the BP family! Glad you joined the best real estate investing website! Here are some recommendations for you:

Find and connect with other BP members that are in your area: https://www.biggerpockets.com/search/users
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: https://www.biggerpockets.com/podcast

If you wish to tag someone in the conversation on the forum, type @ followed by their name and then select the name of that person which should appear below the comments box. He or she will be notified of being tagged so that the conversation will continue.

Wishing you the best!

Hey Kenny, welcome. I'm also in San Jose and investing out of state. I have bought a few properties in Cleveland. Great cash flow but not much appreciation, at least if the past is a guide. Kind of the opposite of Silicon Valley, where the cash flow stinks but appreciation has been outrageous.

The list of links posted by @Dmitriy Fomichenko is a great start for a beginner to the site (or a beginner to REI). Another one I'd suggest is BP's top 20 real estate books:

https://www.biggerpockets.com/blog/wp-content/uploads/2019/03/Best-Real-Estate-Books-Ever_1.pdf

There are some meetups in the area that you might enjoy. DM me if you have any questions. Good luck!

@Anna Sagatelova @Tom Ott
Thank you all for the warm welcome!

@Mark Hart Thank you! The BP conference looks like a great opportunity. I've never visited Memphis or TN, but just did a little bit of research on the real estate market now after seeing your post. Looks like there are a good amount of homes there that match the criteria I'm looking for - I'll definitely keep Memphis on my radar!

@Tal Tamir Thanks! The cash flow looks incredible for Cleveland. My only concern was that based on my research, it seems there's a net migration out (https://www.huduser.gov/portal/publications/pdf/ClevelandOH-comp.pdf). However I'm sure if you pick the right areas that isn't a concern, and it looks like there's a lot of positive economic outlook. 

@Robert Matelski That would be really helpful - thank you! Sent you a PM. I'd also be happy to share with you (and anyone else interested) information I've collected from my experience with Huntsville, AL.


@Aaron Belt Thank you very much! On the residential side, it's a great time to be a landlord in Huntsville and the property management team was able to secure a good tenant within a few weeks of closing on the property. It's common for homes to sell within a few days of being listed, and the economic sentiment is pretty solid with lots of government investment along with the large companies moving in. It's also one of the fastest growing tech cities in America.

How's the market in Scottsdale?

@Dmitriy Fomichenko  Thank you! I really appreciate this information.

@Joel Fine  Thank you, it's great to connect with someone in San Jose who is also investing out of state. I'm proud to say that I've read two of the books in the PDF, and will add the others to my reading/listening list for Audible. Thank you for this resource, and I'd love to check out meetups in the area.

@Kenny Schumacher Welcome! I'm also a new investor from CA looking to invest in Memphis. I'm actually in Memphis right now checking it out! Anyway, we have similar backgrounds as I also have a degree in Accounting and finance. Passive income is the goal and there is a great wealth of information here to help you get there! Good luck :-)

@Kenny Schumacher Welcome aboard, sir! Ohio is GREAT for investing, and I have several clients from Silicon Valley who take advantage of that and LOVE it. Your dollar goes so much farther here, and the low cost-of-living means you can sell one property in San Jose and use those funds to buy TEN properties here in the MidWest. :)

@Kenny Schumacher Glad to be of service! That is something that may scare people away from Cleveland, however, in my experience, it has not made a dent on the Cleveland occupancy rates vs national statistics. There has been a TON of new development across Cleveland the past 10 years which is why we are starting to see such an influx of young professionals moving back to town. I agree, the population growth, and job growth, is not in the green, it has been historically pretty flat. To me, I see an opportunity, because people are going to places like Tampa and Columbus where there is a lot of national attention (because these kinds of population numbers looks really attractive) thus driving up prices and competition to actually take down and acquire investment deals.

Hope this helps!! 

Welcome @Kenny Schumacher ! Sounds like a good plan of focusing on your main income stream while building up the passive income on the side. We have 200+ units in Ohio and another 2,300+ throughout the midwest. There are some very attractive markets out here. Good luck!

@Kenny Schumacher , I'm a new investor looking to get started in Huntsville, as well.  I moved here about two years ago from Sacramento, and would be happy to help with on-the-ground impressions of the Huntsville / Madison area.  I'm also looking for referrals as I put my team together.  Charles

Originally posted by @Kenny Schumacher :

 (maybe Cleveland, OH?). 

Congrats on getting in the game, you've done long distance investing! Not too hard huh? Why leave AL so soon? The cashflow is good, low property taxes, top landlord friendly state. I usually recommend investors to stick to one market for at least a couple properties or at least stay in one state. You can diversify in different ways with in that market or state— you can diversify within class of properties or types of properties as well. By staying in one state or market, it can make your life easier if you work with the same property manager for multiple properties and also the year end tax filings. I'm not sure if you are using LLC's or foreign registries but also another reason to stay in the same market for at least a few properties. I am investing in Birmingham, al but I live in ca. One of the other things that I have found by sticking to one market for a little bit is the opportunities that can come to you as you build your portfolio - There and the people you meet. As an example, I had the opportunity to buy a five Plex through a property manager I know in the area.... The project didn't end up working for me but I ended up being able to wholesale it to another investor. I never thought that I would do wholesaling.... Also another big reason to stick around in 1 market longer is working with a team you trust, those people are golden and a bigger part of the picture.

@Kenny Schumacher welcome Kenny! I mimic a lot of the above with love for Cleveland market. Born and raised here and have just a few rentals on the west side. Also do some flipping.

If you’re willing to go the route of value add here you cannot go wrong. A little more involved but in the immediate suburbs there’s tons of dilapidated duplexes and quads you can really drive up rent on.

Takes some time but there's potential to find $550-$700 a month places and turn into $1100-$1300 units with some love. Additionally money invested in almost always pays you back on a BRRRR.

If you come across any deals and you’re unsure potential I’m glad to give you a quick answer.

Also I recommend dealing with local banks here. With older homes and knowing the market they tend to give

Less hassle on inspections you may encounter otherwise.

Originally posted by @Kenny Schumacher :

Hey everyone, my name is Kenny Schumacher and I'm a new investor living in San Jose, CA. I purchased my first residential rental property in Huntsville, AL in May 2019, which was initiated after meeting an investor during jury duty (funny story).

I'm 25 years old and graduated from Loyola Marymount University, with degrees in accounting and finance. I interned my junior year summer at a public accounting firm, which helped me finalize my decision that accounting (as well as having a "real job") wasn't for me. Instead, I pursued entrepreneurship, started some businesses, sold one, and am managing a few others.

Due to work, I don't have too much free time. But when I'm not working, I love staying active and exercising, exploring food spots, anime, and abusing AMC's A-List.

The idea of passive income, as well as making your money work for you through investing, really excites me. As it's difficult to find a positive cash flowing property in most of California, I decided to look elsewhere, and stumbled upon Huntsville by chance. I was fortunate enough to find a good realtor and property management company, and am planning on purchasing additional properties in the near term future. Should things settle down a bit and I get more time, I'd love to explore flipping too.

The easiest solution would be to continue investing in Huntsville, as everything is already setup for me there. However I would like to explore other cash flow generating opportunities (maybe Cleveland, OH?). A friend who started investing in real estate around the same time as me referred me to BiggerPockets, and it looks like a great community that I would love to be a part of!

Thanks for your time, and I'm looking forward to connecting with you all!

 Welcome aboard Kenny.

@Danielle Wolter That's awesome that we share similar backgrounds and are also both investing out of state! What made you choose Memphis? A trip there sounds fun!

@Bryan Blankenship Thank you! I've subscribed to your website (ohioturnkey.com) and look forward to seeing some properties.

@Tal Tamir That makes a lot of sense. Thank you for your help!

@Andrew Hogan Thanks Andrew! That's really awesome - what do you like about investing in Ohio?

@Charles Hirst Thank you, I'd be happy to have your help. How do you like Huntsville compared to Sacramento? I've sent a connect invite.


@Melissa Nash Thank you! Not too hard (yet, fingers crossed). These are great points, and I do have a good team set up in the area that will make it fairly simple to invest in other projects in Huntsville. It's definitely the easiest option and likely the correct one in regards to my return on time to continue investing in Huntsville.

The main reason I want to explore other areas is to see what other opportunities are available. Real estate in general is really fascinating to me, so it's fun to research and put time in to learn about other markets. Having a team set up in Huntsville is awesome, and it would be even more awesome (to me) to have a team set up in Cleveland, Memphis, and other cities. I figure spreading myself out will allow me to catch even more opportunities, although I do understand that by investing heavily in one city instead of spreading myself out can allow for unique opportunities in that one city (like the 5-plex you mentioned).

What made you choose Birmingham?

@Michael Masterson Thank you! Cleveland sounds like a great market. I'm definitely interested in flipping, I'm just not sure how feasible it is for me now with limited time and without me having any physical presence in the city. Thank you very much for offering to help out!

@James Wise  Thank you!

@Kenny Schumacher I chose Memphis mainly based on cash flow potential. Because I own appreciating property in CA, I wanted to add some higher cash flow properties to my portfolio. I was familiar with Memphis as I used to go there a lot for work. I just got back from a trip out there and it was an amazing experience. I met a lot of great people. I highly recommend anyone investing out of state go visit and meet some people in the area. It gives you a whole new perspective. 

@Kenny Schumacher , I was born and raised in Sacramento.  Huntsville now is a lot like I remember Sacramento when I was growing up before it became so frantic.  I really enjoy Huntsville for the slower pace, yet there are plenty of opportunities for activities, food, etc., and if you really need something that's not right here (with the commensurate dose of traffic), it's <2 hours to Nashville, Birmingham, or Chattanooga, and about 3.5 hours to Atlanta or Memphis.

My day job brought me out here and it honestly wasn't even on the radar before that.  Now I don't see any reason to leave.  If you make it out this way, you'll be shocked by the cost of living difference....

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

We hate spam just as much as you