All Forum Posts by: David Song

Quote from @Osazee Edebiri:

I think the constant discussion of California vs anywhere else is intriguing. So I pose a question. Hypothetical, if a person had a  2 million dollars to invest, they purchased property with 1 million in California and 1 million in any other state, which would perform better after 15 years and why? 

This assumes anything and everything will happen, which is the real life case anyway.  I am not automatically assuming California will perform better just because I live here in the Bay Area. I think someone may have interesting incite to why another state could out perform California property in the next 15 years.

This question has been debated on BP for over a 

Quote from @Kit Elliott:

Quote from @Bruce Woodruff:

@Kit Elliott Not trying to be funny here, but seriously, for LOT of investors I know, their investment strategy is to leave California and take their dollars elsewhere.....

For those who are investing in CA, I wonder who they are? Becasue I see a a lot of flips going on around here. Maybe big institutional investors who can afford to not make money the first several years?

 I invest exclusively in CA, peninsula, east bay, modesto, fairfield, patterson, los banos, and santa cruz.

There are a lot of people investing in CA bay area. They do not appear to show up on BP much. There used to be a few bay area BPers, but most have disappeared over the years.

Bay area, IMO, is the best RE investment market in US. Although many on BP will dissagree. 

I checked some OOS market like Las Vegas, columbus OH, and Houston TX. My conclusion is all those markets are inferior investment markets compared to Bay Area.

1. Their price point and cap rate are almost the same as properties in modesto to fresno area (central valley). Whereas their appreciation potential is less than central valley.

2. In Houston, TX, which I visited this April, the price to rent ratio is about the same as in bay area. In some bad neighborhood, their return might be similar to Oakland, CA.  The property tax (>2%), which is also adjusted yearly based on the appraisal value, is a big problem. Their commercial properties also offer around 5-6% cap, similar to what I can get here in Hayward or central valley.

Therefore, I decided not to invest OOS, but focus in bay area and neighboring areas. Purchased 3 properties this year (self storage in Los Banos, SFR in hayward, SFR in castro valley). One more coming in Hayward (5 unit commercial).

Anyone have a good house cleaner recommendation in Santa Cruz, Ca area?

Quote from @Chris Clothier:

Quote from @David Song:

Quote from @Jay Hinrichs:

Quote from @David Song:

Quote from @Bruce Woodruff:

Quote from @David Song:

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

I see your point, but are you sure...?

Sure about what? If I know the future, I will not hesitate now.

 offer 700k quick close  have you gotten a trio on it to see whats owed ?? 

This morning, I checked this listing, the price dropped on sep 1st to $739k.

9 am: wrote an offer, $680k all cask, no buyer contingency, 10 day closing

Under contract at around 12 pm. Seller requests closing on 10/10, due to travel arrangements.

@Jay Hinrichs

Thanks for your suggestion and encouragement. This is a pretty good deal.

 Nice job David!  Congratulations on getting this one under contract and especially at such a good price.  Good luck with this one.

 Thanks. Chris. Enjoy the Labor Day long weekend.

Quote from @Jay Hinrichs:

Quote from @David Song:

Quote from @Bruce Woodruff:

Quote from @David Song:

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

I see your point, but are you sure...?

Sure about what? If I know the future, I will not hesitate now.

 offer 700k quick close  have you gotten a trio on it to see whats owed ?? 

This morning, I checked this listing, the price dropped on sep 1st to $739k.

9 am: wrote an offer, $680k all cask, no buyer contingency, 10 day closing

Under contract at around 12 pm. Seller requests closing on 10/10, due to travel arrangements.

@Jay Hinrichs

Thanks for your suggestion and encouragement. This is a pretty good deal.

Quote from @Chris Clothier:

Quote from @David Song:

This is getting really interesting. I just looked at a house today.

SFR in Castro valley, ca

7/17: $925k

7/27: $825k

8/22: $759k.

I have multiple rentals in this area. This house, 6 month ago, will easily sell around 1 m, with multiple offers and a bidding war.

So I called the listing agent and want to know if there is any offer on the table. No.

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

On the other hand, I also want to wait a little longer to see if the market will further soften and get a bigger discount.

I am surprised that nobody offered at this price point. 

 You make some great points here.  You are an investor who knows his market.  You have identified target properties and know the history of the area, but also the history of the property itself.  You are weighing your options and recognize that when you buy, it is just one property in a bigger portfolio.  You know your own position and know that you can act now and you will have a deal that fits your expectations and your portfolio well.  You can also wait and watch and if you lose it, no big deal.  If it comes down and you buy, you have a slightly better deal.  If it stays the same, then again, you buy or you don't buy - both are the right decision for you when you make it.  

Sometimes, investors can make things way more complicated than they need to be.  Reading or paying attention to too many headlines can only make that worse.  I do hope other lesser-experienced investors read this buried deep in the thread and understand that buying decisions need to be made on your own criteria and needs.  What any of us on BP or any economists in the news has to say doesn't matter a whole lot.  Good luck David and hopefully whatever you decide to do it works well for you.  Best

Thanks, Chris. I have been buying for the last 14 years in Bay Area, 1-2 properties/year. My daily routine is checking out properties in person, open the door, check the floor leveling, estimate repair cost, evaluate lot size and potential for addition, etc. After that, I wait and see what price level that house got sold.

Over those years, the prices in Bay Area has jumped about 4 fold. Continuing to find appropriate properties to offer becomes increasingly challenging. Therefore, in recent years I gradually moved away from peninsula to east bay, and then Modesto, Patterson, and Los Banos areas.

Mobile home parks, strip malls, self storage units were my focus in the last few years. The recent drop in prime location SFR prices may present a rare buying opportunity, that I have been waiting for years.

I have a feeling that by end of 2022, I might have a record year of acquisition, assuming the price drop continues.

Quote from @Jay Hinrichs:

Quote from @David Song:

Quote from @Jay Hinrichs:

Quote from @David Song:

Quote from @Bruce Woodruff:

Quote from @David Song:

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

I see your point, but are you sure...?

Sure about what? If I know the future, I will not hesitate now.

 offer 700k quick close  have you gotten a trio on it to see whats owed ?? 

 Thanks for the suggestion. I will give it a try, and report back. It’s a trust sale. Nothing owed.

 there ya go  all cash quick close as is etc etc you know the drill  good luck.

 Thanks. Always go all cash no contingency. It was hard the last 2 years with bidding war raging in Bay Area, sometimes over 500 k above listing. Now maybe the time to grab some deals. From now to q12023, I hope there might be some deals to be had.

Quote from @Jay Hinrichs:

Quote from @David Song:

Quote from @Bruce Woodruff:

Quote from @David Song:

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

I see your point, but are you sure...?

Sure about what? If I know the future, I will not hesitate now.

 offer 700k quick close  have you gotten a trio on it to see whats owed ?? 

 Thanks for the suggestion. I will give it a try, and report back. It’s a trust sale. Nothing owed.

Quote from @Bruce Woodruff:

Quote from @David Song:

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

I see your point, but are you sure...?

Sure about what? If I know the future, I will not hesitate now.

This is getting really interesting. I just looked at a house today.

SFR in Castro valley, ca

7/17: $925k

7/27: $825k

8/22: $759k.

I have multiple rentals in this area. This house, 6 month ago, will easily sell around 1 m, with multiple offers and a bidding war.

So I called the listing agent and want to know if there is any offer on the table. No.

I am tempted to offer at around 740k range. If there is no crash, the price stabilizes, that will be a good deal.

On the other hand, I also want to wait a little longer to see if the market will further soften and get a bigger discount.

I am surprised that nobody offered at this price point.