All Forum Posts by: JJ P.

@Klemens N., please clarify: How does the WY LLC not do business in California if the properties are located in California?

You could pay off your property and then start to snowball the remaining debt with your extra $300 a month.   I would NOT take cash out (debt) of your primary to pay off or pay down rental mortgages that are at 4%.   You're just moving debt from one place to another, and the interest rates on the rentals are low enough to not be worth the trouble.   Debt snowballing allows you a little bit a flexibility-- slow and steady, but it's definitely the turtle in the turtle/hare race of becoming debt free.   We tackle the long term hold rentals first, even if the debt amount is higher.  But that's just us.   It's nice to pay off the lowest one because it happens faster.    Financial Mentor has my favorite debt snowball calculator.  

You guys are posting the Case Shiller index... it's an APPRECIATION chart.  So it showing year over year increases for four years of a whopping 13% appreciation in Seattle, a respectable 6ish% appreciation in LA and then dropping to about 1% appreciation for the final Jan 19 tally.    Let's look at LA, since that's the most modest.  That means in LA houses went up 5-6% between Jan 2015 and Jan 2016, another 5% from 1/2016 to 1/2017, another 7% or  more in '17-18 and 1% or so from '18-'19.    My way of looking is that you got compounded interest for all these years (the Jan value is higher than the year before).  If we don't compound it and take the very lowest numbers for Los Angeles, it's still impressive, just add 5%+5%+7%+1%=18% in 5 years.   That's about right... 20% or so in 5 years in LA.   And in Seattle, they're smiling even more.   And in SF, the numbers were so high to begin with that they've been smiling for years.  

I agree with you on the whole Left Coast thing.   We are southern California based and decided to invest in the Coos County area of Coastal Oregon.   I spent months looking east of the Mississippi, which is definitely less expense then most locations east of the Mississippi, but we decided that culturally, we're more familiar with the way the West Coast works, and that was actually a deciding factor.   Price points in Southern Oregon are very investor friendly, the rental market is tight overall, and it's easy to get to from where we live by plane.   I'm aware of the Idaho migration, and I have no doubt it's a great and beautiful place to live, but I think the Bay Area residents will tire of the winters.  They simply aren't used to that much winter weather.   I think Oregon and Washington state both have great potential for flippers targeting the new Tech work-from-home markets.  They will be looking for very nice, safe places to live and raise families with a nice vibe for young, healthy, active professional people.  There are lots of low cost flights along the west coast also, making it relatively easy to come home to see the family.

  I think these states are less sweet for buy and hold landlords, because they are tenant friendly states.   But we are quite a long ways down our land lording careers, and opted for rentals in spite of the less friendly landlord regulations.  

It's not very close to Beaverton, but we've just bought in the Coos Bay area.  Have you looked down there at all?  It's sort of a small pocket of economy, currently not a lot of appreciation, but limited rentals available and some interesting possibilities. I saw one or two flipped homes for sale, and they weren't that great.  There's definitely room for improvement in the rehab market.  I think there's still some bargains to be had and perhaps be ahead of the curve.   I think the area is appealing for people who no longer need to commute to work and are looking for a great value for their dollar in a place to live.   It's gorgeous and houses are relatively cheap.  

You get a LOT of bang for your buck there in West Coast terms, anyway.  There's a commercial airport that makes it just a one hour flight from SFO or DEN, plus a thriving tourism/vacation rental business (ex-covid) along the Coast, an outdoor recreation mecca,  and some world class golf courses that cinch it as a somewhat well kept secret for rich golfers. I have a friend who works booking private jet charters, and she sends lots of very wealthy people to golf in Bandon Dunes.  

I have an excellent realtor in that area to recommend if you PM me.  

@ Grant 

@Grant Schroeder, what is a Rate/term refinance?  I'm not familiar with that term.   

By all means, @Patrick Flanagan, if you can keep the house and rent it for positive cash flow, and still have the means to purchase something else, that's the ideal way to build your portfolio and long term wealth.  

Yes, but wouldn't it be better to just establish an automatic payment from your own account?  That is completely hands off, and all the major banks have an easy "repeat payment" set up.   If it's not required by your landlord to prepay the entire balance, why do it?  If you just want to make it easy on yourself, this automatic payment might do the trick.  

Good job!  Is there a group further west, nearer to North Bend? 

No matter where you choose to invest, I think taking a reconnaissance trip is essential for out of state investors.   Triple this advice if you're a newbie just getting started.   Don't buy anything in a city/town/state that you haven't ever laid your eyes on.  I consider this an essential part of due diligence, even though it might not be fun.    I think the excitement of "becoming a real estate investor" and the panache of owning out of state can blur the lines of reality.  Dollar signs are in the eyeballs, and this is definitely the fun part.   

Not to be the rain on the parade, but... You are trusting strangers with your hard earned money, your dreams, your future.    

I'd go close to home, first, regardless of where you live.   The difference between an afternoon drive and an overnight flight is huge.  

 Then I'd look for location location location.  For investment properties, that usually means knowing your market and knowing where the up and coming neighborhoods are.  And where they aren't. In my town (small), the difference is block by block.   When I say know your market, I mean know every house in an area that's newly listed, what goes pending and how fast, and what price they close escrow for.   Drive by them.  Go to open houses every weekend.   See at least the outside of every house you can.  Know what the rents are for them, also.   Do the math as if you bought them and needed to rent them out. 

With your goals, I absolutely would not recommend outsourcing.  You're already doing enough outsourcing with the investment groups.  If you want to learn how to do this and build an empire by 2023, you shouldn't outsource.  You will pay for any service that you use, and you lose 95% of the ability to use your own judgement/resources/hard work.   If you want to make an investment and not be involved, then it seems like your investment groups are already vetted and working for you.  Perhaps your best hands off resource is already right under your nose?  Maybe you don't want to be hands on?  Spend a little time thinking about this business you want to build.  

That said, I can't personally recommend any turn key providers.  Turnkey didn't fit my criteria for all the reasons I just outlined.   I opted to buy nicer grade homes closer to home.  It seems easy and exciting-- Roofstock.com has a "buy it now" button, for Pete's sake (don't do it!).    But, at the end of the day,  I'm not comfortable turning over my investment --aka hard earned money-- to someone else from start to finish.  Are you?     I'm a big believer in the old saying that nobody cares as much about your money as you do.