All Forum Posts by: Radhika M.

@Amit M. Interesting study. I do agree with  you that we need 5+ million to feel wealthy here. 

If you had asked me a few years ago I would have said 3 million is rich but I now feel 5+ .

@Keli Landowski The national average to feel wealthy per the study is 2.5 million not one million. I think in most places 1 million is not what it used to be 5 to 10 years ago.

Congratulations. Enjoy travelling around the world.

@Jin Kim need more information. 100K is what % of the price? If property is 1 million then 100K is 10% and if it is 500k It would be 20%

How much lower are the rents than market rent. When was the last rent increase? How many days years have the tenants stayed there?

@Amos M.Thanks for sharing. I have also been following this closely as we have a rent controlled 4 Plex with a couple of tenants paying below market. This is one of the reason we are being extra cautious when looking at properties now. 

@Jin Kim Like @Arlen Chou asked above do you have kids? Are schools important to you? If schools are important then are you okay with living in one side of duplex? 

When you say west San Jose which zip codes are you talking is it 95129 or 95117/95128/95130? The prices in 95129 are much higher than the other 3 zip codes mainly because part of 95129 gets Cupertino Schools. 

Based on the price point you mentioned I am thinking this is the 95117/95129 zip code. 

I have been looking closely at this area and to me the prices have gone up quite a bit and I am on the fence and taking a wait and see approach. 

I think as Suggested above 95124 is interesting and prices have been climbing there also. 

@Brian Zitzow I just wanted to add another note. Cash flowing with FHA loan is going to be very hard where we are in the cycle in Bay Area. Just a nature of things here.

Just make sure you analyze multiple properties in the area to figure out what it is you are looking for is there on the market. It may very well be that you won't find the returns you are looking for on MLS may be easier off market but even that might be hard.

Good luck.

@Brian Zitzow

Are the rents market rate or they they below? Can you increase the rent. You need to know your market to make things work. Don't use general Vacancy rate of 10% and Property management of 10%.   What is the area's local Vacancy rate? I am not familiar with Roseville but in San Jose where I am the Vacancy rates are much lower 2% or 3%. I I assume 5%  to be conservative. The property management is lower than 10% in San Jose. It is around 6%  so find out what it is in your area. 

Don't make assumptions. Like Bob said above you need to see how the area appreciates and also the rent growth in the area.  

In the end even after you look all these the property may not work out but  you get a more realistic idea to move forward.

@Amos Mui

I own property in west San Jose so not very familiar with Downton San Jose but the rents of 2100 for 2 br seems actually on the lower end depending on the condition, Size and location  of property.  

@Account Closed deals with downtown San Jose area so he may be able to provide more accurate data than me.

@Amos M. 

If you plan to sell or want to do a cash out refi then yes it would make sense to renovate and increase rents as soon as you can. Are you cash flow positive with current rents? If not I would renovate and increase right away

But you do not plan to sell or refi and are cash flow positive then I think this depends on few factors.

Are you happy with your current tenants? Are they on Month to Month or yearly lease? 

How long have the tenants stayed in the place? Since the rents were low when you purchased I would assume a long time. Do tenants they pay on time and are they low touch (not many complaints and easy going)?

Since the difference in rent is 450 per unit for a total of 900 for both units and it will take you  4 years to get back what you spent (remodel cost + loss of rent when you are remodeling) I would wait for a turnover and then remodel at that time. 

In Carol's case she has rent control and it would be very hard to get a good increase. In san Jose for a duplex as of not there is no rent control so you can increase the rent every year until they vacate and when they vacate I would renovate. 

Just my 2 cents

@Carol W. I think you did a great job for your first deal. I think this is just one example of how investors can increase the value of their properties. 

Are you managing the property yourself? Is the property in Oakland? A 4 plex in the bay area for 920 seems like a great deal to begin with.