All Forum Posts by: Paul Wolfson

I am looking to buy a two-story single family home in SoCal. I was hoping that after the 1994 Northridge Earthquake, building codes improved for residential properties, but I'm not exactly sure what year did the codes changed significantly. Some say that homes built in 1980s have very good earthquake codes, but others say that after the 1994 earthquake is when it really improved.

Questions

1. Do you know what year, specifically after 1994, did major earthquake code changes go in effect?

2. When the big one hits, in terms of damage, will there be much difference between earthquake codes of a house built in 1989 vs. 2004?

If you were buying a house for yourself which would you choose?

A) The house that is fully remodeled. Price: 750k.

B) House down the street. Same sq ft. Identical to house to A, but NOT remodeled. Livable for now, but will eventually be remodeled. Price: 700k. Rehab/Remodel: 50k.

The question at its core is would you rather spend your own capital on the remodel, or would you rather just buy an already remodeled house, preserving your own capital, and use that capital to invest elsewhere?

Hello BiggerPockets family.

In the article below it mentions strategic ways to get your offer accepted including "Appraisal Gap Coverage" strategy.

Say a home is listed for $100K, you go under contract on this home for $110K, but the appraisal only comes in at $105K. Your appraisal gap coverage now kicks in, you come up with $5,000 cash. 

Question: Is this $5,000 cash considered like a credit to the seller (money lost forever) or can I think of it as simply like a larger down payment (money I can recoup later)?

https://www.biggerpockets.com/blog/7-tips-offer-accepted-hot-market?utm_source=Iterable&utm_medium=email&utm_campaign=Newsletter%20%7C%206/21/20&utm_channel=28425

Hello BP friends. I live in an expensive market and recently started exploring options investing out of state.

After running the numbers in several markets, I'm finding it difficult to find cash flowing properties almost anywhere? 

Can you please let me know if I'm doing something wrong?

For example, let's look at Kansas City, MO.

https://www.redfin.com/MO/Gladstone/3441-NE-72nd-Ter-64119/home/78227438

Here's a SFH for 150k.

• Principal & Interest: $604
• Taxes: $114
• Insurance: $63
• Vacancy (8%): $100
• Maintenance/CapEx (10%): $125
• Management (10%): $125
  

Total Expenses: $1,131

Rent: $1250/mo (according to Rentometer)

Cash Flow: $119/mo

Other parts of KC, I am getting negative cash flow. Am I doing something wrong?

@Rick Albert thanks for your input. Houses in SCV are on average about 50-100k less than TO and Granada Hills. A house in the TO neighborhood I’m looking at with a detached garage on average costs about 750k. SCV on the other hand doesn’t have houses with detached garages but on average houses are 650k. I ran some numbers and discovered that it would cost me about the same to either:

1. Buy a TO property with a detached garage for 750k. Plus 80k for ADU conversion.
2. Buy SCV property without a detached garage for 650k. Plus 120k to build ADU from scratch. 

Since the renter of an ADU would likely be a young professional, I’m wondering if TO or SCV has more/better job opportunities. 

As for Granada Hills, house prices are about the same as TO so I wouldn't be able to afford to build an ADU from scratch there. Only if a property already came with a detached garage. Also I'm a little worried about the Alisso Canyon gas leak. Did they fully shut it off?

@Nabil Suleiman @Justin R. my family is looking to move into a safe neighborhood with great schools. Additionally, looking for homes with detached garages. Any recommendations of which neighborhoods to look into?

I'm looking to buy a SFH, preferably with a detached garage to convert to an ADU.

Some houses in Thousand Oaks have detached garages, but Santa Clarita has none. It would be more expensive to build an ADU from the ground up compared to converting an existing detached garage.

Having said that, my concern is that Thousand Oaks has less rent demand than Santa Clarita, and that i would be harder to find tenants.

Which city has higher rent demand and what resources can you recommend to compare rent demand?

@Paul Dashevsky thanks for the referenced article. I'll take a look. I know you can't have 2 detached ADUs on a single lot zoned R1 for a single family residence. However, In my case I'm trying to see if I can have 1 ADU and 1 permitted guest house.

@Nabil Suleiman if I am successful at permitting the guest house, are you allowed to rent out a guest house or must it be an official ADU in order for it to be allowed to be legally rented out.

@Nabil Suleiman I believe the zoning is R1