All Forum Posts by: Shiva Bhaskar

Hey Michael, love Echo Park! Great community. I had the realtor who assisted me in my recent SFR purchase and renovation, handle tenant placement and management for 5% (this is in Gardena). Vacancy should definitely be way less than 10% in Echo Park, or most areas in LA County.

There is also a new app, created by a fellow BP member, that is helping to connrct landlords with lower cost, vetted PM. Not my company or anything, but I like what he's doing. Feel free to message for details. 

Hey Boris, welcome! You have a few options. One is to focus on outlying but quickly growing areas in Southern Caifornia - specifically Riverside, and possibly Bakersfield. Or, choose properties in LA which need work, buy under market, and rehab (BRRR strategy). Just make sure you build strong contractor relationships.

Another is to partner with friends, or investors you meet, who share your goals. A lot of people who succeed in SoCal, even in smaller deals, are using partnerships. 

A third possibilty is to go out of state. I also invest locally, but recently moved into the Ohio market. There are many others. Feel free to DM me for any questions you may have. 

I owned an "aggressive" breed (German Shepherd) myself as a kid, best dog ever. Thinking about adopting another. Mom's close friend had a pit bull for many years, sweetest dog you'd meet. 

With that said, your rental is different. I met someone from BP in Cleveland, who was rehabbing a wholesale duplex he'd bought, I think there were pit bulls in there, and they had done some damage (so did the tenants). Lots of insurance policies also don't allow it as noted. I would pass. 95% of the population does not own pits or similar breeds, so you'll find plenty of tenants. 

 Started journaling about a year and a half ago, it has really improved my life. Helps me keep in sight what's important, and be honest with myself about both goals as well as fears and emotions. Can't recommend it highly enough to other folks. 

 Congrats Mark! Sounds like a great deal. May I ask, which area? And  what sort of work (if any) is required as far as rehab? I've mainly focused on single family in the South Bay (Gardena, Hawthorne etc) thus far, but hoping to move into South LA and elsewhere soon. 

 I have a sort of unique take on this (or so I think), so bear with me please.

 I grew up in the Los Angeles, where immigrant real estate entrepreneurs have made fortunes, especially in Class B and C multifamily, and mid sized hotels. We're talking folks from Korea, who sometimes started out in grocery stores and retail, had stores burned in the '92 riots, went through lots of hardship. People from Vietnam, who fled here in the 70's with the clothes on their back after the war. Chinese and Taiwanese immigrants, plenty of whom started their own businesses. Others were immigrants from Iran who were fleeing deadly anti-Semitism back home after the 1979 revolution, and got into the garment business and then real estate. Then, there are folks from India who were engineers and jewelry store owners and started investing their money. 

A few generations earlier, folks from Italy and Poland and Russia and elsewhere in Europe did this too, in Chicago, New York City, Philadelphia, I'm sure lots of other places. These folks built property EMPIRES under very adverse conditions (WWI, WWII, Great Depression etc).

The point is, folks came here with limited money, few connections, an unfamiliar environment, a shaky grasp on the language, and sometimes, not much education, and in most cases, limited real estate knowledge. Disadvantages, right? Sure. What they DID have was a drive to succeed. They formed relationships, often within their own community, because they had no other relationships really. They pooled capital. They got out there and took action. 

Was it hard? Knowing a couple of these folks in LA personally, I can say, hell yes. Would anyone looking at likely real estate investing successes in Los Angeles, 30 or 40 years ago, or Chicago and NYC 110 years ago, have picked most of these folks? Almost certainly not. But here we are. 

The point is, we all come face some sort of challenges in succeeding (sometimes, like these folks, severe obstacles), and we all have our strengths and weaknesses. I know my construction and rehab knowledge needs work, for example. Other folks may not be outgoing, or understanding financing as well.

However, you capitalize on their strengths, want it bad enough, and find others who compliment what you don't have (and make sure their weaknesses get just a little better, don't drag them down). If this is what you want, and you're willing to do what it takes, no one but yourself can truly stop you. People have come from nothing to achieve, not just in real estate either. 

Now, your mentor may have had a point (inartfully expressed, to be sure) that starting out with a full time job can make sense. If you had a good job and make solid 6 figures, getting financing for properties early on is easier, and you don't have to look for as many partners early on. Also, a job does provide stability - there's nothing dirty about an honest day's work, and moving towards your goal of financial freedom over time. I think most people do it that way.

As far as what he said about your skills, you're not meant to be an entrepreneur, whatever, you can treat it as one data point, and keep moving forward, or you can let it get you down. We all have people and situations that don't encourage us, but we do choose how we react to it. If this mentor doesn't work for you, fine, ditch him, but align with folks who DO push you forward. 

Have you heard of Benjamin Hardy, the motivational coach and I think psychologist? Google him, he's great. He talks a lot about how one's personality and identity is, in a sense, not fixed, and can be shaped by actions. So, the right actions can change your identity and personality, not just the other way around. If you want to be more "entrepreneurial" or more "real estate oriented" then take actions in line with that goal. 

Go to meetups. Learn about investing. Read books. Find folks you can align with, not just as investors, but over time, as friends too. People with drive and character and good values. And over time, you'll start doing deals. I'm fairly early in my investing career, and have a lot more action to take, and things to learn. I know 0 compared to some folks I know, even people my age who've been doing it for 8 or 10 or 15 years. But I believe I'll get there. Doubt at your own risk. 

And so will you. Go forth and prosper my friend. Financial independence is absolutely something you can achieve, and much more. 

 I love this strategy you're using - as a city guy (mainly have lived in LA and NYC and invested locally), I've always wondered about the potential of some of these more rural areas. Seems to me like if it's within an hour's drive of some sizable employers, or a metro area of 150K or more, it could be a good play overall, in the sense that there are jobs for folks. I hear great things, from a cash flow standpoint, about investing in the smaller, outlying towns from major Texas cities, and I think the same is true for CA, if you go deep into San Bernardino or Riverside counties.

One concern I do have, and I think you alluded to, is the concentration of one industry in a metropolitan area. In following the recent GM layoffs in Ohio (near Youngstown I believe), it seems like there are some smaller outlying suburbs that will be hit badly by this. I think in the Midwest especially (not to pick on the region), this seems like an issue. 

Assuming that isn't a huge issue, seems like a good play for cash flow - with the kind of cap rates you're getting, it's hard to say no to more deals! Of course, the city does offer appreciation and ease of selling in future, so diversifying makes sense, but as long as these generate strong cash flow,  sounds like you should continue to expand. 

I am looking into investing in syndication for bigger deals myself (besides doing my own smaller deals, as I do already), and while I love Grant's motivational spirit, I think the main upside of his fund is the liquidity, and smaller investment amount. There definitely seem to be much better ROI there, but you can't get out in one year, and the minimum investment is much larger (i.e. for accredited folks only).

I would listen to some of the Bigger Pockets podcasts on syndication (the one with Joe Fairless is very good, and he has a great podcast of his own too, as is with Marcus Becker, more recently). They have lots of interesting information, that I found really relevant. Also, check out platforms like Equity Multiple, which let you get access to a range of different syndication deals. I do think if you have the capital and time frame (or your client's do, I see you're a financial adviser), putting more money into a good deal with higher ROI, is a better bet. Also, would rather analyze and invest in specific deals that meet YOUR crtieria, rather than a fund.

 Carson, for what it's worth, I have seen this before often. Worked as a rental real estate agent in NYC a number of years back, and they would allow clients who were new to country (and so had no credit), or folks with bad credit (but no criminal history), to pay the entire rent upfront. Admittedly, most of these are larger multifamily owners with a lot of resources if something went wrong, BUT it did not always mean something fishy - I think most times it worked out.  Of course, this was a relatively high end tenant base. 

I would run your standard procedures, meaning, make sure you are checking credit, rental and criminal history, and even though he's paying you, seek some proof of employment and income. If all those check out, and you REALLY get a bad feeling with the guy, then sure, pass. However, if all those were OK, I would personally take him. 

 Was cracking up at some of the comments earlier, but what Henry said. Am an attorney myself, and know someone who was an attorney in this field of law - the risks of non compliance are massive for banks, thanks to provisions in the Patriot Act. They need to show they did due diligence. Just a few years ago, HSBC got into hot water for not exercise such diligence (or looking the other way deliberately, more likely) and laundering billions for Mexican drug cartels. 

But yeah, what others said, let them know the refi money is being used to acquire other investment properties, in the next ___ months (just a general idea of when you may buy).