All Forum Posts by: Mohit Asthana

Hello! I'm a 23-year-old future investor that wants to get into real estate. I don't want to buy a single family home, but rather wish to purchase a commercial property because of more professional landlord/tenant relationships and different types of valuations. 

A friend of mine turned me onto buying post office buildings and I saw that a few were priced in the 60-100k price bracket.

I'm trying to buy a commercial property out-of-state, with a 150k budget. I'm wondering how I would manage the property, audit my property management firm, and respond to repairs needed. 

Does anyone have any experience with buying commercial property out of state? 

Hey Brian! Nice to meet you and welcome to the forums. 

Where in CA do you invest and where are you from? 

 Not from my experience, no. We've had solid tenants in our rentals that have stayed for at least 8 years. When I was taking a real estate course, my professor was an attorney and said he faced some 'professional tenants' who knew how to stay in the property as long as possible. 

• Do you live in California? Yes, in Fremont, CA
• Have you lived in California in the past 5 years? I was born in raised in Fremont, but I went to school in Phoenix, AZ
• If so, where? 
• Will you be staying or leaving? Staying since I live at home. 
• Why? I could rent a nice class A apartment for about 2k-3k with a roommate. I could invest in other market places that produce higher yields. I wouldn't want to live anywhere else, except maybe NYC 
• What is your full time income producing job? I work for a telecom company for the time being, but I'm extremely open. 

The trouble with the bay area is since the housing stock is so old, but it's such a desirable place to live. A lot of foreign investors are coming in and paying cash, also driving down yields. The rates going up means the cost of capital is increasing. Plus at these current prices, you can't buy for cash flow. 

Do I think it's going to be consistently bullish? No, I think there will be a market pullback maybe in 2019 or 2020. I'm looking at the London and Sydney markets of 2016. 

"What goes up, must come down".  

Hi, has anyone ever bought a post office before? 

A friend of mine introduced me to the idea and it's seems like something to look into. 

The USPS is a government entity that never wants to move and has a AAA credit rating. The rent may be a bit lower than market value, but the cash flow is going to be consistent. 

The leases could be either triple net or modified gross. Returns may be lower, but lower maintenance. 

This looks great on paper, but does anyone have experience actually buying them? They're as cheap as 100k and seems like a good introductory investment in a niche asset class. 

Good to see another SF Bay Area person! I think it would be difficult to househack in the Bay Area tbh. 

I would invest in other "red" states that are more landlord friendly, as CA is one of the least landlord friendly states so it could take anywhere from 4-6 months to evict a non-paying tenant. 

I would also recommend going to Neal Bawa's Meetup group. He's an apartment syndicator and he knows his stuff! 

 No, the company I worked for sold it to large institutions like pension funds, insurance groups, and private equity funds. They don't want to do the work and would rather buy a stabilized asset (like the portfolio of apartments I worked for) and just reap a nice stable return for their shareholders. 

I went to school there and am looking for a small multifamily (owner-occupy using FHA).

From my research, I've seen small ones go from about 5-8%, depending on the amount of rehab/deferred maintenance needed. In a few models I've made, we would be cashflowing around 100-400 depending on the interest rate. 

What would your house rent for in the current market conditions? If the numbers make sense, I'd say rent it out and refinance your property to buy a multifamily property.  This way, you reduce your cost of living, possibly making money on your house. 

If you sell, you are exempt for up to $500k in capital gains tax since you're married and lived in the house for 2+ years. I wouldn't trust Zillow's zestimate frankly, but I would look at the "recently sold" category. 

I wouldn't touch private money if you could refinance your house right now, as private money is usually a lot more expensive than a traditional mortgage. Some of the hard money people I've talked to usually loan at 10-12%, making it quite hard to make money.