All Forum Posts by: Sherwin Gonzales

@Jian Lin great question!

Not sure if anyone already suggested this or not but I like The One Thing: The Surprisingly Simple Truth Behind Extraordinary Results by Gary Keller and Jay Papasan.

Great book to get you focused on your goals, whether it be in life or in real estate, and breaks it down to simple goals in order to achieve your bigger goals...the domino effect!

Hope that helps!

@Chad Deihl and @Gordon Cuffe do you have any commercial mf (5+ units) lenders you can recommend? Thanks in advance!

@Jordan Wight I was in your shoes 3 years ago. I, too, lived in SF, got married and wanted to buy a home to start a family. SF housing prices were crazy back then as well as the housing market. The current housing market now wasn't as crazy as it was 3 years ago. So what did I do? I looked outside of SF and was lucky enough to buy a home in Oakland. It was 3/1 house and I added value by adding a second bathroom. So with this force appreciation and market conditions, my home gained quite a bit equity. I did a cash out refi, pulled my deposit out (which was only 5% down) and used that money to buy an investment property in Sacramento (which cash flows btw).

So investing in the Bay Area or just outside the Bay or in California in general is possible. A great investor makes their own deals and deals can be made anywhere. It's just a matter of your comfort level and what aligns with your goals and lifestyle. I hope this helps! Feel free to reach out to me if you have any more questions!

@Jordan Wight when lots of people first start out investing, they usually purchase their first home first. That way they go through all the motions you mentioned above, "seeing lots of homes, driving neighborhoods, going with the inspector, meeting the seller/ broker, etc.."

You mentioned you have enough capital for a modest home in a suburban area so have you thought about buying a home for yourself? Then maybe you can house hack and rent the other rooms if that aligns with your current lifestyle? Live in the home for at least 2 years (since you need to live in a home 2 out of the 5 years if you decide to sell to avoid capital gains tax) and either keep the home as a rental or sell.

That's basically how I got started. I purchased a loft in San Jose and moved out after 5 years and rented the place. It's a great strategy to ease your way into investing and get your feet wet! Good luck to you!

@Anthony J Ruma welcome and congrats on starting your REI journey!

I'm not too far from you. I live in Oakland and work in SF. In addition to the BP website and podcasts, I would suggest you attend some local meetups. There's a monthly meetup I attend in SF. If you're interested, let me know and I'll send you the info.

Also curious to why you want to invest out of state and not locally? Perhaps it aligns with your goals? Anyways, if there's anything I can help with you now, don't hesitate to ask! Good luck!

@Ryan McCook congrats on your success in acquiring 9 properties 5 years!

I would first figure out what your goals are? Do want to keep managing these 9 properties or want to scale bigger?

I personally would 1031x into one or two commercial multifamily properties and manage just one or two roofs instead of 9. Reap the benefits of multifamily!

@Frank Patalano

Capital.

I've got the team. I've got the experience. I need capital to scale and grow my business further. So I'm networking, telling everyone I know and I don't know about my real estate, and just build relationships with people who are looking for opportunities to build and improve a lifestyle they can be proud of!

@Harshil Patel congrats on starting your journey into the world of real estate investing! See below to my responses to your questions.

1:) How to determine the average price for property in that particular area? ( Currently looking at websites like zillow /trulia). Are there any other ways?

Sites like Zillow and Redfin are great to get quick comps for a property but you can also leverage an agent's skills and tools to run comps for you. That's what I usually do and I also sometimes check craigslist or rentometer to get rental comps.

2:) I have heard so many things about long distance real estate investment. For new comers we should focus on local area first as a first investment to get the knowledge?

It's really up to you and what your goals are. Do you want to be more passive or more active in the deal? If passive, then long distance real estate investment might be a good choice where have an operator or sponsor do all the leg work on a deal. If you want to be more active, then maybe a local investment might be best to get your feet wet and gain hands on experience in a deal. I personally wanted to be more active in my deals in which I find the deal and work with brokers and lenders during escrow, and once closed, I'm the one managing the property and any rehab work if necessary. So figure out what works with your current lifestyle now.

3:) Which kind of options I should consider like 1-2 bedroom apartment or Single family home or multifamily home? The near future goal is , I am more interested in rental property investment.

What type of property peaks your interest and which will help you achieve your goals. You say you are more interested in rental property investment, so that applies to all the property types you mention. Find out what you feel comfortable to deal with now. Do you want to deal with a single tenant in a SFH or multiple tenants in a MF property? Do you want to deal with a small property to start or jump to a big one right away? If you're uncomfortable, you can always partner with someone who has experience and work with them to learn off of and mitigate your risks.

4:) what are the financial options to buy the first property. Like I am aware of bank loan or FHA loan, Any other ways which can allow me to get the loan less than 20%. :)

Seller's financing is a good option. As I mentioned above, you can also partner with people to fund the deal for you while you operate the deal so that you don't have to come up with the 20% down yourself. You can research other loan programs that will allow you to put down less than 20%. Talk to lenders. Network. Talk to other investors. Network. See what others have done and keep asking yourself "HOW" can I do certain things.

I hope this helps. Good luck on your journey!

@Kusha Karvandi I would invest in BITCOIN!

Seriously tho, I would take advantage of leverage and spread your 1m across a variety of deals.

It all depends on your goals. Do you want to be more active or passive? Are you interested in flipping or mf syndication or commercial retail?

I personally would invest in different commercial multifamily family properties. If this sounds daunting, then partner up with someone with experience or get involved in a syndication to mitigate your risks.

I wouldn't put all my eggs in one basket but rather spread the wealth and create passive cash flow from multiple sources on a continuous basis.

Good luck!

@Michael Gorence congrats on taking action and doing the first steps in investing by deciding to partner up with your friend and their team on a deal!

What is your ultimate goal eventually? You mention you hope to BRRR out of state, but what does that mean? Do you want to be the one to find the deal and negotiate and rehab it yourself? Or do you just want to be the one to fund the deal and have someone else do the rest? I guess how involved do you want to be in your deals?

I think it's great you are partnering up with someone with a proven track record to work with and learn off of. It seems at this point, with your limited time, your role is to be a passive investor and rely on your sponsor to operate the property?

If you are funding the entire deal and your friend's team is operating then a 50/50 split would be the assumed structure. But it all depends on the amount of contribution, whether financially or actual boots on the ground work, that will determine a fair structure for your team.

Hope this helps and good luck!

Btw, I live in California and all my deals are here. How many deals have you actually analyzed in California and where? OOS investments are great but if you really want to get your feet wet, local investments might be a good way to start!