All Forum Posts by: Frank Wong

Pricing for a 2 unit v 1 unit is different so the loan officer could have mispriced it.  You won't know for sure unless you shop it.

4 PTS 20% rate. I would never do that. Nothing is guaranteed for the outcome and results but what is locked in is the fees and rate you have.  If the deal was that juicy you could easily find better financing.  Everyone has a different idea of what is risky.  That is way too much for me.

I would not upgrade the building until the tenants move out. There is no need to.  Fix anything on the exterior that is in need of repair but anything interior just let it be.  

Hi Marcus,

I would pull some comps and give them a fair offer.  So if you came up with $380-400k. $380k seems like a fair offer for both sides.  As for closing costs just split it 50/50 or whats customary for your County and City.

Street names that's the easiest.  If you have 2 on the same street I go with the name and if I got it first.  Redwood 1 and Redwood 2.

No, you can't buy cash flowing 2-4 property in the Bay Area. Prices went way too high and grew faster than rents. You certainly will never buy cash flowing property in the Bay with 3.5% FHA financing. The financing and size of the loan amount will be too high. Unless you got an absolute steal and stole the property from the owner but lets work with reality which is no.

Is it possible to find value add and grow rents in East Oakland and cash flow? Sure its possible but very hard to accomplish and you ain't doing that with 3.5% down.  Sorry to burst your bubble but that's the reality that we live in the Bay.  

FHA 3.5%, in general, will be very hard to cash flow not just in the Bay Area but everywhere in the country. The debt service is just way too much to make any positive money each month. Just run the numbers. What you are paying for each month in negative income is to get your feet in the door when financially from a savings standpoint you are not ready or should buy.

Hi Joey,

If I was in your exact position this is what I would.

1. I would NOT buy as many houses as possible with the money.

2. I would take the $300k and buy 1 house cash and then scale and buy another house cash once I have a proof of concept.  Now I have guaranteed money coming in with very low risk. 

3. Find a new job that pays me more money. 

Hi Stephanie,

First, you have built an amazing portfolio for yourself and you are doing great.  You have 4 quads and 3 SFRS and at this point, I would be careful on how to scale.  You don't want to be overly aggressive and put yourself in an over leverage position but I am sure you already know that. 

To me, this is an easy one. You pulled out $170k from your quads.  Now you want to know what to do and buy with that money.  Take the money and buy in cash a few more SFRs the same that you have already done and proven to yourself that works. Just repeat it.  

I would not take the cash and then buy SFRs and then finance the purchase. Why?  Because you already pulled the cash out of your Quads and you would then be essentially financing all your purchases at 100%. That is way too much leverage.  That is when people go broke when the market turns or whatever happens to rents.

More is not better in many cases.  I like to net more with fewer properties but first growing the portfolio then owning them free and clear.  I want to create more money along with more time for myself to fully enjoy it.  That's the end goal, right? More money and more time.

Hi William,

My advice is to not focus on Real Estate but focus on making money. Find a way where you can increase your income skills and earning power or find a way to start a business from school online.  RE investing requires a lot of capital and you need to find a way to get that. No Money = No Investing. 

It's great that you want to learn at such an early age but gotta focus on what's the most important thing which is making money.  I think too often people get distracted and think RE fortunes can be made with no money or little money. That is so far from the truth.  

I was naive and clueless at 21 and bought my first property.  I guess that takes guts to just pull the trigger but in my mind, I didn't think much of it.  I already knew I would make it work no matter what.