All Forum Posts by: Dan Schweit

This is doable. Everyone always talks about MF house hacking, but buying a SFR and renting out rooms accomplishes the same thing, if that's something you're open to. As @Clarence Johnson mentioned, you can do 5% down conventional which can save you a ton on MI. If you're willing to commute up to an hour to work, you certainly have a lot more options available to you, possibly even MF option. Good luck in your search. If you'd like to discuss the financing options that are available, feel free to message me.

2 Votes

Los Angeles County, California

@Luis Cruz

Congrats Luis! Paying off that debt was a huge accomplishment along with raising your credit score. Although you may be in line to go the private money route, taking care of your credit score will pay dividends for you throughout your life. Welcome to BiggerPockets and good luck in your journey. If you ever have any questions feel don’t hesitate to reach out.

0 Votes

@Jason Flores

Welcome! You found your way to the right place. At your age, with the information available here, and the willingness of most on here to help, you’ll get to where you want to be in no time. Take in as much information as you can, then really decide what type of investor you want to be, then go all in on that. Time is on your side. I’m always happy to chat all things real estate related, so feel free to DM me if you ever want some direct help, guidance or advice. Good luck on your journey.

1 Vote

@Brit Sharon

Ahhh....the self employed dilemma. Pay less in taxes or look better on paper. Seeing as we are at the end of 2020, you could always run a much larger amount of money through as income when you file your 2020 taxes. We can take a 1 year average, if you have had the business for at least 5 years. Just one option. Feel free to DM me if you want to discuss any other possible creative options. Good luck.

0 Votes

Originally posted by @Brett D.:

@Dan Schweit, I appreciate it. As far as Palmdale or Bakersfield, I figure I don't have the time for two to four-hour round trips... I might as well go out of state. What do you think?

@Rohit Goel, right on, brother... That's awesome. Have you gotten better COC rates?

@Joe Steele, I get it, it sounds good. Maybe after we get our feet wet. But we can't stomach it for our first.

Your goal should be to not have to drive 2-4 hours very often at all. Maybe a few times in the beginning, but after that you shouldn't have to go much at all. Point behind it being, its only 2-4 hours away IF something goes wrong, or when you want to drive by and check on it once in a while, or when you have a crew on the rehab, you can check on their work once a week. The reason why a lot of us invest in real estate is because it passive. Buy it, which takes some looking, rehab it, which does take some time, then rent it, which should be relatively hands off. All this being said, LA is hard, and very crowded with investors, buts its still doable, just takes timing and lots of digging and offers. or just finding a decent deal, making a sizeable down payment, and letting time do the work. Still a good strategy as well.

1 Vote

I hear everything you just said, and I agree with it as well. I just wanted to make sure you are aware of that metric when you are running your numbers, and it seems like you are. Like I said, COC is not the only factor determining whether a deal is worth it to you or not. And, you are not wrong to be getting in now, as who knows where things are going 1-2 years from now. So, if you are happy with the numbers, then by all means, go for it! You might want to look into Palmdale and or Bakersfield as well. The numbers I have penciled out look better out there, and it is still in your own backyard relatively speaking. Some decent multi family options out in Bakersfield. Id be happy to chat with you about what my partners and I have found out that way if you'd like. Good Luck.

2 Votes

Originally posted by @Ian Salinas:

I agree with Ian. The COC is what you should look at on this deal. Obviously your strategy may not put an emphasis on this metric, as there are other aspects (appreciation, tax benefit, debt pay down) that may be more important to you, but don't lose sight of this one as well in your calculations.

Hey Brett,

if I understand your numbers correctly

355,000 Purchase price

25% down = $88,750

Rehab cost = $30,000

Total cash invested = $118,750

Cash flow = $197 (2394 annually)

That's about a 2% cash on cash return. I'm not sure what your strategy or your criteria is but that's just something for you to thing about.

I agree with this. The COC is what you should look at on this deal. Obviously your strategy may not put an emphasis on this metric, as there are other aspects (appreciation, tax benefit, debt pay down) that may be more important to you, but don't lose sight of this one as well in your calculations.

0 Votes

@Tina Tsysh This is how it’s done! Young, ambitious, going after what you want and willing to start from the bottom. You should find what you are looking for in no time. Best of luck to you!

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Hi Rob, welcome. You came to the right place, and prior to pulling the trigger, so a good time as well. You'll be able to gather a good amount of information here to help you in your process. LA is definitely tough, as you have already found out. Its more of an appreciation play, and debt pay down, than cash flow. You also wont find a good deal just sitting waiting for you, but if you work at it and have a good realtor, are willing to write lots of offers, then you will eventually find something. I'm not sure of your current living situation, but house hacking is going to serve you best. If you are past that point, then I would just decide exactly what your investing goal is, then work back from there to set up a plan to accomplish it.

What areas are you currently looking at?

0 Votes

All Forum Posts by: Dan Schweit

Dan Schweit has started 11 posts and replied 107 times.

Post: Investing in High Dollar Areas with Lower w2 income

Post: sHouse Hacking in Greater Los Angeles under 500k

Post: Newbie from Los Angeles, CA

Post: Real estate investing

Post: Beginner Question about being self-employed

Post: Newbie's second offer in Santa Clarita (Los Angeles), CA

Post: Newbie's second offer in Santa Clarita (Los Angeles), CA

Post: Newbie's second offer in Santa Clarita (Los Angeles), CA

Post: Apprenticeship under a house flipper / general contractor

Post: Los Angeles Real Estate Investing Advice