All Forum Posts by: Tobias Falzone

My advice is to not go looking for a mentor per say. Start networking with people who are where you want to be in 5 years. I recommend going to REIA groups and start from there. Ask questions, ask for referrals to other people to talk to. think about what you can do for others. If there isn’t a REIA group that works for you, think about organizing a meet up targeting the people who you want to get to know. These steps will take you much further than any guru course.

Welcome! You’ve found a great community for real estate investing. I am actively looking at the Huntsville AL market as well, though mostly in the multifamily arena. When I researched crowdfunding a couple years ago I was not impressed with the offerings, which tended to just look like private lending at reduced rates. I’ve heard some folks have success with it but it is too much control to give up for my goals.

In that price range you are too small for a true commercial real estate loan. Generally the commercial folks only want to talk 500k loans and above. Below that amount you have to find portfolio lenders, private money, or a “business” loan.

Welcome!  You found the right place to be.

I'm actively looking for property in the Huntsville area, but am focusing on multifamily properties.  Let me know if you need any advice or ever want to think about multifamily property.  I can recommend a few books at the least.

I live in Folsom and own a rental property here as well. I got very qualified applicants within a few days. The renters take care of everything, pay all utilities and hired a gardener. There is very little rental inventory available, but the CoC returns are lower. However, the stability of the tenant class and desirability of the area make for a lower risk investment as well. That said, I may decide to 1031 exchange the rental at some point to something that cash flows better. Let me know if you need any other insights

@Gay Lloyd is a useful contact for you in the Ogden area for this. The NUREIA is the local Ogden REIA that will have good contacts for you as well. I would start there.

Sacramento wealth builders and the Roseville meetup are the two I regularly attend.

I run numbers (estimate a total of Cash flow, mortgage paydown, tax benefits, appreciation) and calculate an effective return on whatever equity is left in the property.  I compare that number to the estimate for a different property and see which one is greater.  My goal is growing net worth, and yours might be different.  I ended up selling my property in west sacramento instead of pulling money out after looking at this type of analysis.  I think Sacramento is beginning to see a peak in terms of prices, or at the least is becoming more risky to hold in the medium term.  

I generally am able to get better returns on paper from larger properties that are leveraged than all cash transactions.  However, stress test your investment on paper (50% vacancy, double interest rate, etc.) and see how it handles different situations.  Your risk tolerance will determine how far you are willing to go with leverage.  You can make pretty much anything cash flow with all cash.

Hi Lance, welcome to Folsom! My wife and I flip houses locally and are looking into BRRR if we find a good enough deal that justifies it. Let me know if you ever want to meet up sometime since we are so close.

@Zach Thomas - I don't mean to paint the area in broad strokes, as the trajectory of the area is very good overall.  My comments focus on the area west of downtown sacramento, not the new developments further south  But like in all transitioning neighborhoods, change is never homogenous.  You see run down and neglected properties/businesses right next to nice higher end developments, which creates an odd neighborhood feel.  The commercial businesses in the area are also set up for a lower end clientele, though that is changing.  A large check cashing/payday loan shop just went out of business near the house I flipped.  I see that as a very good sign, but it will take time for the commercial base to turn over and renovate to catch up to the neighborhood.  I talk with the neighbors and they always note how much the neighborhood has changed, how people feel safe taking dogs on walks and strolling even in the evening.

However, you will see an unusual number of homeless folks meandering around the area of west sac directly west of the river.  Many are the type that don't appear dangerous: recycling collectors and the like.  But they are pervasive, numerous, and noticeable.  There is dumping of sofas and old tvs on the side of the roads, especially around the apartment complexes and in the industrial area.  Crime has gone down, but there is still quite a bit of it.  The older residents are used to being on guard in that way, but stigma usually lags reality in transitional neighborhoods.  Many homes have bars on windows.  I do not feel they are warranted anymore and removed them off my project.  

@Jaymin Jasoliya - I'm not convinced of appreciation potential in Natomas as much as I am in West Sacramento.  I think West Sac is already transitioning as a neighborhood, but if you are waiting for a large employer to move in and change the neighborhood in Natomas, then you are looking many more years down the road.  But either way, invest in flood insurance in both of those neighborhoods!