All Forum Posts by: Kristi Miller

great advice, I knew I would get it here. We grew up in Des Moines, Iowa and know it well. It is just not comfortable for Midwesterners to wrap our brains around the price of property here! Our primary resident was days away from foreclosure when we bought in Napa in 2010. Looking back we should have been scooping up all in sight.! My Midwestern conservatism has re-entered my subconscious and I am worried about a bubble. Our property alone is worth 30% more in three years...... Thanks to my Nor Cal friends who have commented on this post, I understand the strategy here- thanks!

@Mike D'Arrigo - Hi Mike, thanks for your response. Its nice to know I am not the only one that thinks this. We moved from Des Moines, Iowa about three years ago, therefore we keep investing in property there. Appreciation does not happen like it does on the coast and the SW states, but cash flow is constant. In the midwest we can keep our numbers at $100 per door without a lot of tenant problems and the average purchase price for a 7 unit building is around 300K- turn key. There is just no a lot of inventory right now, so we are investigating other states. Maybe onto Omaha, NE next. :)

Hello:

Although we live in Napa, CA, our real-estate portfolio is with properties in the midwest. We just understand that area the most. After looking at some multi-family properties here in Northern California I do not understand how anyone makes money investing here if you are a buy and hold person who prefers to buy properties already in good condition? The price of the property is much higher than the rents being paid. Any insight? Are most investors in CA paying cash for the property and investing for appreciation? as opposed to cash flow and high cash on cash return?

Hi Kelli: I think a lot of it can. We have had the property just 20 days now. There is a tenant we will want to get out. Some high electric bills and snow removal bills. The last landlord did it himself - and that is an area we have now learned to check!. I am sure we can up the cash flow about $100. I just remember listening to a BP Podcast with a guy that paid cash for his properties. His timeline was about 10 years, the same as mine. Paying cash is completely opposite of the leverage heavy advice I have been reading. I am just wondering when cash makes more sense than leverage. I have the cash to pay the property off, without it necessarily hindering my ability to acquire more property.

all on the list to do! :). Just not sure if there is a "magical point" where leverage stops working in your favor.

Hello: We recently invested in a fourplex that is turning out not to be the best property - many lessons learned by this one!!. Anyway, unfortunately our cash flow is only about $50 per door. We have a conventional 30 year 5% loan with 30% down. Based on these numbers- (until we sell it) would it be better to pay the loan off, to save on the interest? or keep it floating as it is?

@Bill Mitchell I am with you on this one. I see these statements often. I spend a lot of time debating in my head if I am doing it wrong or if sometimes statements are a little inflated. I currently have two duplex's, I am closing on a 4 pled and my next offer is on 12 plex with two pads ready for development of 24 more units. I prefer the larger units, the cash flow comes quicker. I am 48 years old and because of that I need to be worried about cash flow . I now can only get commercial loans since I own more than five properties. Those loans are at 5% with 20 year amortization. If I am buying properties that do not need rehabbed and are in immediate rentable condition in A neighborhoods - it is going to take 15 years to pay them off with the cash flow put right back in the mortgage. I have NO Idea how this is done in 6 under the same type of conditions.

Hello. We are considering buying a block of town homes, specifically 8 townhomes built as 3 plexs. There is one town home owned by another party, that is not selling. The seller of the town homes is responsible for the HOA association and pays all dues. Does anyone have experience with this type of scenario.... Would we have to title each individual town home ?

thanks! I was operating under the assumption of 10 with four tighter. That is why I was thrown for a loop with his response. Are most portfolio lenders found in small banks?

hello! I currently have three mortgages out on rental properties and made an offer on another one this week. I was told by my bank that smaller banks are now following the practices of the big five and will only approve three notes before requiring you to go through a commercial financing

Any suggestions or comments regarding different routes to take?