All Forum Posts by: CK Hwang

Barbara, welcome to BP. I read your intro with great interests and had a question for you. If you love sailing and dream to own and live on a sailboat, why not make money from that rather than real estate? Real estate seems like a fairly roundabout way to get to where you want to go. I have friends that flip boats and they do pretty well financially. All the principles of flipping houses are pretty much the same in flipping boats. I have others that trade in marina docks and memberships. Another that used to do boat charters in BVI all which gave equivalent yield as rental properties. Just wanted to see if you have considered such ideas.   

Hey Marjorie D. I actually almost moved to Jamaica plains. There was this beautiful loft that was previously a brewery we were looking at. Have you thought about outskirts like Waltham or Newton? Charlestown has much cheaper prices real estate, of course it is a little bit of a rougher area as well.

Originally posted by @Curt Davis:

@CK Hwang 

Would you hire somebody with no real estate investing or contracting experience to be your project manager? 

 Actually, I'm in the midst of a project right now that would be just perfect for a first time project manager since it's just pain carpet and a little termite work. So yes, I'd start them out with a easy project first, then build up the complexity. For my side, project management is really just making lots of calls, dealing with the subs, getting quotes, visiting worksite and checking on work nothing terribly difficult. Just time consuming. 

@Marjorie D. if you're interested in flipping but don't have the capital, have you thought about perhaps approaching a local flipper and seeing if they would be interested in hiring you as a project manager? To me this would be the safest and easiest way to get into the game without the necessary capital. This would also raise your income and allow you to get a mortgage and build the reserves to back up that mortgage. Furthermore it builds your reputation and gives you credibility such that investors would want to put money with you in the future. 

Got to say I am very very happy with my CPA. She managed to find depreciations I didn't take when I first started my own accounts and managed to get back about $6K from the IRS for me. 

Money aside, I love that my accounting is almost totally hands off. Whenever the IRS has some missing form or this or that (and it seems like they are always losing my stuff and hounding me for something or other), she takes care of it

That being said, she does specialize in real estate tax issues, so I think because of her background knowledge she is better suited to find deductions in the deals I do than say a non specialized CPA. 

Personally, I wouldn't let them do any work on the house until they have a mortgage to buy the house clean off you. I don't know what the laws are in your state, but I sure as hell wouldn't want some court case where the buyers have some claim to the property due to the stuff they put in, should your land contract go south.  

Danny, I'm going to be a bit of a contrarian here and say to start building a list of buyers now, even before you've found a deal. And concurrently, start putting together legal forms as a wholesaler. 

The reason I say finding buyers now is important is because wholesaling (from my what i know here in OC) requires you to move fast. The high price and high demand means housing is very liquid compared to other states. To convince someone to let you sell their house off the open market for less than market value often means that speed is one of the few reasons they will give you the deal. Take too long and they will just list it on the open market.

As such, you'll need to have buyers ready, and I mean serious buyers. You'll meet many investors that will say they are in the market to buy, but those that seriously have the "firepower," the speed and the will to do so are few and far in between. I would say of a list of 100 buyers, you will find only probably 3-5 that will consistently be able to buy from you, especially here in Socal where the cost of housing is so high.  

I'm not 100% sure, but i have a strong feeling a lot of the wholesale classes taught by real estate "gurus" from other parts of the country might be much harder to execute here in Socal. It's far easier for someone to take a chance with a wholesaler when it comes to $100K house versus a $700K house since the spread in absolute amount is going to be much smaller.   

Business cards are important! For myself, they have been the cheapest and most effective form of marketing. 

Stephanie, look at it this way, all investors make mistakes early on in their journey before succeeding. I think there is a certain quota or certain amount of money the universe takes from you before giving back. Now that you've made yours (if it even is a mistake), you can get down to having the successes that you are in line for. 

Don't feel bad, early on in my career, I had made paper losses amounting to millions and to this days, some of those losses are still hanging over my head, but if I wasn't for those losses, I wouldn't have learned the lessons I needed to learn in order to move forward. 

The first thing I would do in your situations, like the other posters above, is to decide what aspects of real estate you want to focus on. Personally, if I was in your situations, the avenues I would look into would be trading real estate options, real estate or loans sales, finance, possibly wholesaling.... sectors that don't take a large amount of capital to start up and where the chance of incurring losses are lower. 

I think it really depends on the market you're talking about. Here in OC, it's not even possible to find a 100K SFR, and if you did, it would be in a terrible terrible location, probably a combination of being in the most crime ridden neighborhood next to the biggest freeway with no sound barrier, previously a meth lab, etc etc. Would there be capital appreciation? probably not (maybe, just maybe it might eek up with inflation). It might even be hard to rent out period, so there goes cash flow. In that case, I'd just go with the 500K sfr.