All Forum Posts by: Rick Albert

Have you gotten multiple opinions on this? Foundations are tricky because there are usually multiple ways to address something and foundation contractors like to scare people into spending the most possible. 

The challenge is I don't where you are but how is the soil? Known for earthquakes or regular settling? I ask because that can make the problem worse over time. 

I could also argue that building costs and building codes change over time. It might be $25K today, but if tariffs kick in next year (or the year after), the cost can rise (whether it is actually because of tariffs or because contractors want to blame it).

I would get at least 3 bids and go from there.

Hey Samantha,

There are a couple of things to keep in mind:

1. You likely did some tax write offs since it is a rental. So you might have $200K in equity, but you would need to pay back depreciation, etc. Talk to a CPA before doing so.

2. I know there is all this talk about the Olympics coming but on a practical basis that has no effect on you unless you do STR, which you typically can't in a rent controlled property.

3. How much are really the savings on the mortgage versus the cash flow you are getting? Have you compared the appreciating cash flow on the duplex to the potential savings on your current mortgage over 1,3, and 5 years? 

4. Selling your property to pay down another would set you back on your long term goals. Consider selling the duplex to put it into a higher income producing asset (out of state, DST, something). You miss out on appreciation on rents and property values if you sell and put the money into your current duplex.

Hope this helps!

One thing I forgot to mention is my clients found a work around. They were already replacing the roof and the HVAC, so they worked with a contractor that replaced those items and added solar at the same time. The way they did the tax rebate made it to where the solar panels were free. That to me would be a good value.

 I never saw them in person. But I saw photos, videos, etc. 

I used my network to find Realtors and PMs. Even then I've had to fire PMs and move to another one. It takes time to find the right team.

I had a few here in Los Angeles before branching out. I did a 1031 Exchange back in 2022 because there were eviction moratoriums in place so I had to sell once my rental became vacant.

I bought a few out of state without ever seeing it. There are a couple of things you can do:

1. Use Google Street Scene. It allows you to check out the area. 

2. I always have my Realtors send me photos of the neighborhood. Sometimes Google is outdated.

3. I actually rely heavily on my property manager. I've noticed now in a few markets property managers are getting picky on what they manage. If they won't manage a property because of the neighborhood, then I know that is a red flag for me to avoid.

4. Do inspections. I recently cancelled escrow on a property because it was in rough shape. It actually sold to someone else for $20K more. Chances are they didn't do inspections and grossly overpaid for the property.

I've never had a buyer pay a premium for solar panels. I currently have clients in escrow on a property with paid off solar panels and when I asked them if it made a difference, they said no.

I have a listing right now with paid off solar panels, so far no one cares.

It is a marketing thing. So if two properties are identical, including price, then solar panels might be a deciding factor. 

If there is an active loan or lease, I've heard it has become a nightmare for listings. The solar company wants to also qualify the buyer. I had spoken to a lender who said he approved his clients for a mortgage of hundreds of thousands of dollars, yet the solar company wouldn't approve them.

Basically, if you are thinking of selling, don't do the solar panels. Very low probability you will get anything back.

This is a really interesting question. We also have to remind ourselves that real estate is for the long run, meaning a D class neighborhood today could be a B class neighborhood in a few years. 

One thing you can check is crime stats in an area. If it is trending up, that could be a sign. Take it with a grain of salt as safety is subjective.

You could also ask your Realtor and property manager their thoughts and maybe next time they are in the area to take photos. They are your boots on the ground. 

You can also see what is being built in the area. For example, let's say a prison is being built nearby, that could affect the desirability of an area. Or maybe a liquor store, which may seem innocent, but could bring in a different crowd.

In terms of "when to sell," it's all about what you plan on doing with the money. Keep in mind if there are economic shifts that you are seeing, so is everyone else, so you may have missed the boat.  

I get applicants with limited to no rent history many times because they are young and just don't have the history. It isn't a bad thing. Sometimes that can be a great thing because they don't know how to screw over the landlord. Some of my best tenants were on the younger side.

With that said, these both are passes. The fact that you can't get ahold of a landlord is a red flag. Also paying cash is another one.

You could run them both through MySmartMove.com and see their eviction history. That might be a work around.

To be honest, all of them work, it just depends.

What I have been learning over the years for me is I prefer 2-4 unit properties. Here's why:

-Management: One property tax bill, one mortgage, one insurance bill, etc. It is simpler and possibly faster to scale.

-Spreading costs: One sewer line, one roof, etc. Recently I had to trim back a tree that cost almost $5K. That cost would have been the same whether it was a single family home or a triplex. Some property managers will also give discounts depending on the number of doors. That means with MFU, you can hit those discounts faster.

-I would argue there can be more risk with single family homes. If it is vacant, that's 100% vacancy. If you have one vacancy in a fourplex, it is only 25% vacant.

With that said, people are killing it in the single family space and specialty property. You are going to get a wide range of opinions here and they are all right...for them. You need to decide what makes sense for you. This includes your short term and long term goals.

Good luck!

@Michael Izbotsky is my personal financial advisor. I'm not sure he can help specifically with this, but if not maybe he can point you in the right direction.