All Forum Posts by: Paul Faryna

Haha, how'd you know, have you seen me there!? It's definitely possible though it would be tough in Sunnyvale.

Income:
$35,000 after taxes -- no real estate tax benefits included! That's a bit more that $2900 per month.

Expenses:
-$1400 -- rent (with roommate, admittedly this situation will change)

-$350 -- electric, gas, phones, internet, car insurance

-$500 -- health insurance

-$200 -- groceries

Total: $2450

That leaves a net of $450 for luxurious expenses and a safety net for "**** happens" - car repairs, vet bills, medical bills, etc.

Clearly doable, while living in the most expensive place in the world and living like a king compared to 99% of people on Earth and 99% of people who have ever lived. But again, this would not be my ideal area to settle down for a few reasons. If we "settled" somewhere with reasonable expenses we could cut the overall expenses in half and have more for luxury spending.

@Account Closed, we COULD get by for $40k per year in the Bay, but it would be tough. Real estate tax advantages certainly would help. We don't plan on staying here forever but at least a few more years. Then it will likely be full time traveling if we make financial independence (FIRE) before having a kid or settling somewhere much cheaper. As for inflation, $40k is a rough number, inflation shouldn't be too much of an issue hopefully in the next 5-10 years (who knows though with QE), but we could easily get by on $35k or even $30k without day jobs. Plus, I'm sure I'll still be hustling on the side working on my blog or real estate or something new!

What other passive investments are you referring to? From my understanding 10% is understated for real estate CCR, but I was just using that to show the feasibility of the plan. I see many members here claiming >20% although it does seem the market is hot and such deals are harder to find.

PS: before learning about the power of real estate my plan was indexing and the 4% rule. This would have meant around $1M invested to reach the $40k goal. Current market conditions (equities and bonds don't look good for 10 year returns) plus higher returns make real estate look like an obvious option if I just learn more and put in the work!

Thanks for the responses guys! A lot of good perspectives.

Also, sorry for the formatting. I wrote it on the app with readable paragraphs and then it got turned into a giant block. Anyone know how to avoid this happening on the app?

@Jeff Keller yeah housing prices here are crazy! I'm not looking to invest in the immediate area, at least an hour away and maybe in other states. I met with a colleague who just bought a duplex for house hacking and the numbers don't make sense to me. I'm looking for cash flow and CCR, not speculating on property values (I'm a student of Ben Graham's Intelligent Investor). Thanks for the info about specific areas here too, I'd love to hear more about your strategy. I know Apple is opening a large campus near my house in Sunnyvale soon (separate from the more well-known Spaceship) and I'm sure there will be some interesting developments due to that.

@Thomas S. I'd like to understand your numbers better. My girlfriend and I are pretty frugal, we can save 50-70% of take home pay. Let's say we had $50k/yr to invest in properties (downpayments + closing + repairs needed to rent etc.) and get 10% CCR (which we could likely due much better than from what I understand). 

This equates to $5k of cash flow per year. Ignoring the potential to reinvest the cash flow or any appreciation, it seems we could have $40k of cash flow in 8 years. I'm sure I may be missing something here, so please let me know what it is. 

If there are any good tools for quickly modeling a strategy like this, I'd be very grateful for a pointer as well!

Hi, I'm Paul. I moved to Sunnyvale, California one year ago. I work as a Product Marketing Manager for a tech company. I turn 30 in September and would like to buy my first property around that time. But let's back up. Haha that started feeling like a description for a dating site. My main goal is to reach financial independence (aka "retire") in the next 10 years. Original strategy was passive index investing but I now see I can throw some gasoline on the 🔥 by investing in real estate. The best strategy for this goal seems to be rental incomes. My goal is about $40k per year which is enough for me, my girlfriend (soon wife),our 2 dogs, and eventually, kids to live on forever. Rent ratios here are terrible so I'll likely invest more than an hour away or even further (out of state). Share your stories if you've done something similar and I'd love to chat!

Hi Sasha, nice to meet you! I live in the Bay Area (Sunnyvale) and am looking to buy rental properties within 2 hours. I'm interested in cash on cash returns on my investments, but also networking with others in the area and sharing knowledge. Would you mind sharing more about your strategy and goals?