All Forum Posts by: Paulina L.

Thanks, appreciate the advice and thinking of age of home to standard repairs timeline. As for if it's a good deal, with 20% down, it cashflows very low. In a promising scenario, it would cashflow ~$100. I am using 15% buffer for CapEx, repairs, vacancy. Rest is in mortgage/insurance/interest at ~$2900/month. Rent is $1500-1800. No PM if I manage it (I fly to my hometown every 2 months). CoCROI is 2.3% in best case scenario, cashflow is $160/month in best case scenario. Fully only an appreciation play. Am I analyzing this wrong? Should I look at other options for better CoCROI?

I am eyeing a duplex in my hometown (not LA) where I'd put down 10%. I'd have to pay for my LA rent while also paying for the duplex which total to approx 35-40% of my after tax pay. With paying for the duplex it's -$23K in the first year, then -$10K for 4 years. Cashflows at year 5. Based on appreciation it would still do well, but does not account for any potential repairs that arise outside of me buffering 5% repairs, 5% CapEx, and 5% vacancy.

I’d like to get something there as I intend to move back to my hometown in 3-4 years and see it as a place I would be long term. However with the negative cashflow, is it worth it? I also can put 20% down, which would make it cashflow but given it’s my first property I am wary of putting too much down upfront. Would love advice/thoughts or if better to wait when I can house hack instead. 

Hey there - i am interested in investing in a secondary or tertiary market soon. Would love to know your experience in either so far. 

Hi all, so I am looking to put in an offer today... But I want to be certain about the numbers. Any advice on this?

Goal: Buying a condo in CA, this is a 2-1. I would like to hold this property and sell it for equity to trade up. I don't think I can cashflow in CA for a very long time, so I'm only focused on equity. 

The unit: In the area I am buying, I’m seeing house prices increase on average at 8-9% YoY since 2015. This unit alone, I am seeing approx 10% avg YoY increase (but only based on estimate and sales price on years available). 

Math/Question: If I used 10% increase (this is hopeful in my opinion) and let’s say I held and sold in 5 years, we would be getting an approx of $224k after agency fee (assuming it grew to $600k price). However, over the span of 5 years I would be spending $222k on my mortgage (which only ~25k goes toward principal so more like $197k which is really more like $27k gain after agent compensation on the house equity). Whereas, if I continued to rent where I am in, which is rent locked. I would be spending $125k (instead of $222k over 5 years) which is a savings of $96k that we could be investing elsewhere.

Any advice on this, is my thinking right? Is it still right to build equity or is it better to consider OOS or other investment?

@Jon Puente - this is helpful, thank you! I'm actually looking at OOS, so I think appreciation is not as high as West coast markets. I looked at Zillow data, and am seeing that the home prices (unfortunately does not include type, just all types) is growing YoY. Is there a different way you'd analyse appreciation?

@Alex L. $100-$150 is after all the $ aside. I used 6-8% for maintenance/repairs, 11% for Property Management, 5% for capex and 5% for vacancy to very conservative in case of any issues. 

Hi all, I'd like to make my first RE purchase. I'm looking at a market that feels promising - steadily increase in population YoY, job growth is strong, diverse job types are increasing, and new activities are popping up. However, I want to buy a multi-family home in this location, which is possible. However, with my analysis I am only seeing around $100-$150 cashflow in the area which makes my COCROI around 3-5% max. In looking at the YoY increase for both house prices and rent, it looks steady and strong. I wonder if this is a scenario where it is still good to purchase, hold (which is what I plan to do), and over the next few years it will likely steadily increase my CF. Would love to hear advice on this. 

Hi all! I am looking at a property that is currently fully rented out. 

Location analysis: It's a commuter town, but it recently has a lot of construction in the area. A warehouse near the town opened up recently as well. 3% unemployment rate and has been steadily dropping, ~35 min drive to a bigger city, renters are higher than the state average (by about +9.6%). The assigned school for the location is a 7/10. My only issue is that it's heavily family (much higher skew toward married vs non-married) wondering if this may be a concern. 

Deal Analysis: Currently rented out at ~$2050/month, ~$1,531 expenses (mortgage, taxes, insurance, variable expenses (total ~$638; vacancy/maintenance at 5% each, CapEx at 8% since it's an older house, 11% Property Management (using 10% as the average but including an extra 1% for turnover)).

Overall this would be ~1.4% using the 1% (or 2%) rule. 

Is there anything I may be missing or any watch outs I should be concerned about?

I’m interested in house hacking in Los angeles, but with price points I will likely only be able to get a condo. I think there’s good areas that can cashflow, but I’m willing to pay the first two years and move in tenants after that for cashflow. Would it be better to buy in a different state or is it bad to buy a condo for first property / HH? Any advice helps! 

Thanks for your advice!: @Eliott Elias @Stephanie P. @Michael Dumler

@Walter Pineda - I think this is the issue I am seeing right now. I want to HH, but when I search for a multi-family property in CA (all the way up to Bakersfield and above even), the cashflow doesn't really break even and I'm usually at a loss. I'm guessing this is common for CA in your experience? I will watch the YT video, thanks for sharing. 

@Steven Foster Wilson - thanks for sharing your feedback + the calculator! This is definitely what I'm looking at right now if OOS vs HH is better, as for me I ideally want cashflow. It seems like OOS has higher ROI and less invested upfront. There's been a few locations in OH that I felt were promising. I am primarily looking at pop growth, rent v own ration, unemployment rate, and school rating. Do you have any advice if these are the right data points to look at for a good location in OH?

@Thomas Tsitouridis - thanks for sharing! I have heard about section 8 being a great investment. When you say that you'd focus on cashflow, do you mean that you'd look at appreciation as secondary? I know Brandon Turner mentions this in one of his books, so I'm wondering if trying to go for both cashflow and appreciation is what is causing the pause for me as I only see one of the other. I'm also viewing appreciation based on market (pop growth, rent v own ration, unemployment rate, and school rating) so getting the best of both worlds (COCROI + market) is few/far. 

@Christos Kalogeropoulos - super helpful, thank you! I am seeing a lot of positive mentions about Columbus, OH. 

Hi all, I am new to investing. I'd like to get started this year, but a few questions on what may be the best choice for first RE as a way to bridge to more investments after. Would love other's advice on best first investment with ideal scenarios below:

Choice 1: Out of state investment (likely has to be anywhere between $75k-110k in purchase price), likely conventional loan, 20-25% down. I'm finding some ideal properties (I'm finding good market with decent cashflow OR bad market decent cashflow - however, as tempting as both are, I'm assuming either way to stay away from the latter. However, the former has been scarce).

Choice 2: Multi-family property (in CA), conventional loan/FHA. I would like it to be a buy/hold with cashflow - my issue with this is that most of the locations I am finding seem to be in great locations (high pop growth, high rent %s) but using the BP Analysis calculator the cashflow is either low or negative, is there any idea why that may be the case?

Q: Would like to hear advice on the above choices for first RE investment that would help with future investments (as well as any advice/answers on the questions in each!)