All Forum Posts by: Alex J.

welcome, i am from tarzana as well.

you have never flipped and are doing a show on it?  do tell more.

@Shandra S. thank you so much for your insight!

i didnt know but podcast 181 the lady talks about lancaster as well being a "hot market" for flippers...perhaps I am already late to it.

i am glad to hear you have done well.  

These results are quite surprising to me!

@david faulkner I appreciate your input, i was just pointing out glendale is a diff market then the area i was seeking info on and stating how its not a comparable market i am not saying that i have anything figured out - if i did, you are right, it would be a waste of my time to talk to anybody i should just be busy doing deals.

I am just explaining that when you mentioned i have flawed logic then proceeded with telling me an example about something incomparable.  Riverside to Lancaster a lot of the subprime markets were overpriced in the boom because there was artificial demand and now those buyers are pretty much gone so the valuations now vs 10 years ago is a complete diff environment.  investors buying and renting is a lot diff than somebody moving in with 0 income and causing demand to shoot up

Anyway again i am very thankful for your feedback and did find some value in it so dont take this the wrong way!

what parts of AV is reasonable to start researching?  any particular pockets you like?

@David Faulkner   really? im not talking about when you bot in 2009 2010 or whenever across a 15 year career... when comparing things you have to look at current opportunities to compare apples to apples right?

its not comparable when saying "glendales a cash cow i bot in 2010 ( or whenever ) and im getting like a 15 cap" when you appreciated into that opportunity via rent increase...

I was fortunate and got into echo park in 2010 in a 4plex that was vacant and the rents have exploded in the area its prob like a 20 cap cash flow for me based on buying lucky......at this point but it is not relevant.  the entire LA market was an incredible opportunity in retrospect from 2009-2014 at this point now that things have made such a huge move... theres no point in talking about those great values you have now

My entire point of this discussion was to find value in areas that might have less downside risk due to price or type of tenant and protect me via better cashflow/caprate...AV is a big section 8 area and thats govt subsidized, during 2010 i never got shorted by the US Govt in payments even in the darkest times.

if you look at glendale now its about 700k for a house lets say and you will rent it for 3500 +- 700... IF the market pulls back significantly , glendale will lose money just like everywhere else even if on a % basis its not as much the out right dollar amount at this point could be much more because this time the AV hasnt appreciated as much from the bottom whereas glendale has exceeded those levels from past highs.. but it can be argued that in AV i buy 3  250k places and now i have diversification of tenants and will still get like 1500 a door for a comparable size house in glendale....Its MUCH harder to find a tenant to pay 3500+ in rent vs a tenant to pay 1500 in rent (esp if govt subsidized) ....not to say that there arent bad tenants everywhere im just saying if i look at things somewhat equal.

not to mention glendale is very likely reaching a point of overbuild with these mega projects all up and down brand / central blvd which could weaken rent prices or at least create a longer time to fill...anyway my point is that i am trying to make a prudent decision and mitigate all the risks as much as possible in order to make a good decision and hope this feedback has helped other readers as well... i am not really sold on AV which is why i wanted to have this discussion

thanks for the feedback

Wow what an amazing set of replies great insight.   Ok so,  let's take a step back... regarding glendale vs Av ...look I am born in Glendale and know it very well it's not good for cash flow and arguably never has been unless it's very big money.  It's an equity play or a flip play on the high end but your argument does make sense in terms of impact long run.  The thing I like about glendale is there is no rent control but it's very much priced in the market

For cashflow with close proximity to la it's either going to be south la unicorporated or somewhere like AV where it's a C to B area that doesn't cost 700k for a duplex.

Regarding out of state investment. ....I have out of town rentals actually I live in Houston for the time being  but about 8 out of my 10 properties are in Los angeles (a hand full of 4plex and a hand full of sfr)  and two are in Houston (a duplex and my house).  We (my father inlaw and i) have been involved since 2009 while both having full time careers outside of rei, so we have had a fair amount of unique issues and working out of state doesn't scare me but without the right team it's a very costly venture.  If I built out the houston rei then end up back in la I fear I won't be as hands on and it will get neglected which is why I feel AV could be a better idea in the long run.

I'm very much a buy and hold or a buy add value and 1031 into more buy and holds.  At this point I have the equity la plays as well as some good cashflow plays due to buying lucky but I am seeking some lifestyle engineering plays so cash flow deals are more appealing.  plus I feel the appreaction game has run its course in major metro areas so investing for future appreciation is not a good idea at this point.

@David Faulkner great insight I might pm you for more info on locations if you don't mind

@David dye Sounds like my south la rentals...high demand and selective strick picking helps but we never know until the tenant moves in!

This has been a lot of valuable information 

any palmdale lancaster los angeles county investors have any insight to this?

@Account Closed  haha yes -  that you are!

the reason i am looking at cap rates is because if eel a lot of the major metro markets in desirable areas such as los angeles nyc sf etc have matured and plateaued in the short term and I am now looking for cash flow positive properties in areas such as the outskirts of LA, and Houston tx...I obviously want appreciation as well but in terms of rental properties I am looking for cash flow, pay down, and grow.

IF i can find great deals in the desirable areas then i would obviously be going after that first but i think the short term appreciation game has run its course and i am "playing small" right now instead of going all in.

@Account Closed

cap rates help me on the surface see what type of relative value there is one pocket to another before jumping in a specific region and....the cap rate is a standard forumla noi/price...if i remember correctly youve asked me about this in a previous post as well and asked me to take it a step further and PROVE to you haha here is the link im ref

https://www.biggerpockets.com/forums/616/topics/30...

its just like me saying "where can i find the good pocket or value in general"  every deal is unique and has its own set of numbers, I am just looking for things to compare one to another.

thats a great way to do it! curious though, ive come across a lot of rental condo, do you have any hesitation about the HOA fees moving up in the future and trusting that type of fee to an association? its always kept me from investing in condos

also how about when ti comes time to sell? do you have any concerns that you will need to sell to another investor that wants a deal like yourself?  cash flow wise this seems to be a great situation!