All Forum Posts by: Trudy Pachon

This sounds like a great opportunity! If these numbers are accurate, this is a good investment. You say it's in a good area, so that is a positive for sure. Tijuana has some really bad crime stats, but I'm sure you know better than I where the problems are. Fear is normal, but the numbers are the numbers. If the numbers work, they should help you overcome your fear. 

I have some property in Oaxaca, and the remodeling costs were extraordinarily low compared with the states for really good work. I imagine Tijuana also has low costs for this as well. 

Good luck!

Good luck!

Great conversation! We were looking at investing in MHPs, but quickly became overwhelmed at the idea of actually purchasing one. We came close. 

Some of the issues we had were with our actions being consistent with our values. The prices on MHPs in the areas we were interested in had gone up so much that in order to make a profit, we would have to up rents to the point of possibly losing folks that might not have a lot of other options. We just didn't think it made sense to us. We are in California, and were looking in CA and Arizona. Not great for MHP options.

However, at some point, I think it would be interesting to own a MHP and to try to empower the residents. What do people think doing some kind of financial literacy/education program with interested residents? Teach them to manage money better in order to have more financial freedom, pay bills etc build credit, maybe even purchase homes in the park to earn even more? I don't want to be in the business of owning the homes, just the land. I don't know how realistic it is, but it was something we considered would make owning a park a better experience for us. 

@David Morrison We live in San Diego too and have been concerned about the threats to regulate STR and some communities are calling for an outright ban. A couple of years ago, our city council banned it in the city, and then quickly reversed itself! It's an interesting problem here, we definitely have a shortage of housing. But not sure if banning STR is the solution!

I wonder if there has been any movement on STR regulation/banning on the east coast @Clint Harris?

What a great thread. I have found that learning to use spreadsheets (you don't even need Excel, Sheets works fine for this) and learning the basics of how to calculate your returns is critical. @Account Closed I totally agree on how unprofessional many real estate agents are. I think it would be nice if those helping investors knew how to do basic math and use spreadsheets.

It's been interesting to see different people's goals here. We are really simple and just need a small amount of income to support the way we like to live, and we are now avoiding what we define for ourselves as overleveraging at this point in our lives. But those just starting out have different goals, and those who are into building massive wealth have different goals as well. It's all really interesting. 

The BP calculator is helpful, but if you can figure out exactly what it's doing behind the scenes, that's really useful as well. As practice, I created a simple cash flow analysis and I wrote a simple mortgage calculator on Google Sheets, and found that skill useful when I bought my Mexico property. I was able to build a spreadsheet to calculate payments etc and convince the owner to carry the loan for us. Once she saw it laid out and I explained it to her, she realized it was a nice deal for her too! I am not a math whiz by any means, but I think in this game, you must know how to do simple analysis and don't trust anyone's numbers unless you run them yourself. 

Learning to use spreadsheets has been the most useful skill I have found in helping me to reach my personal goals with real estate!

@John Hickey

Q for you. What lesson do you teach that will help them really get ahead in life How long is that lesson...who wrote it are we talking bill gates, warren buffet, a Rockefeller, a Morgan

Great question. I know we're off topic, but this is really really interesting. I teach the life science courses at my school, as well as a work prep class in biotechnology. I do chat with some of the kids about the Kiyosaki principles of understanding assets vs. liabilities, if they are interested.

But yes, I agree that financial literacy would be a GREAT subject for the kids. To get them to understand how money works, what it's good for, and what it's not so good for! I wish we had better programs for this. We would have less of these issues around messing up communities if more of the folks  from them were educated around financial literacy! I think this is what you're alluding to. If so, I totally agree.

@Cody L.

I was referring to the "reparations" bit in @Dennis M.s  post. 

And in yours, "How do you think most wealthy people get that way? How do you think most poor stay that way? Do you discount individual drive and effort and put it at the feet of the mythical systemic racist bogeyman?"

If you don't understand at this point that we have a systemic problem with wealth disparity and racial issues, I know there is nothing I can say that could help you to understand. I work in the trenches with poor kids and families every day as a teacher, and I can assure you, they have plenty of drive. The effort many of these families exert just to make ends meet is humbling to me. 

The mythology of "rich people are just better people because they're rich" is absolutely untrue. We exhault them in the US, but they often don't have a ****ing clue about what they are talking about. But I would not stereotype all rich people as out of touch ********. Some are, and some are not. Each individual comes with his or her own story. 

@Dennis M.

The attitude toward poor folks you display here is the reason people hate all investors. Seems a bit racially biased as well.  Hope you have the opportunity to meet some of these displaced folks and change your opinion about people who don't have the same opportunities as you do. 

Gentrification is a super complex issue. So great to read through some of these posts about the ideas investors have about this. 

My thoughts this morning are:

1. Do you think gentrification is an issue? Yes, of course it is! I live in California and teach here. I have homeless students. Homeless children are an issue!
2. Do any of you ever struggle with the reality that we collectively price people out of their communities? Yes, I do. But it is an inevitable consequence of a system that rewards certain behaviors and punishes the poor. 
3. Do you ever think of it that way? I always do, but I live in the system and don't live under a rock. So I participate, though I try to do right by my tenants and my neighborhoods. Not sure it helps, but makes me feel better. 
4. Do you ever feel bad about contributing to the gentrification of communities? Yes and no. Again, it's not me. I live in a system and participate in it. I have the luxury of profiting from it as well. And, well, if it's not me, it will be someone else. It's screwed up, but that's the reality. Would hate for some Lex Luthor character to buy up the properties I buy...evil laugh...
5. What are the alternatives? Affordable housing? Some type of system that allows folks to live in their neighborhoods even when prices go up? It has to be a collective decision that we say, "Hey, people need a place to live where they have family, jobs and roots. Maybe we can come up with some ideas about how to make this happen, while also allowing neighborhoods to improve." 
   Someone much smarter than myself would have to say what that would look like though. I have no idea. 

@Jim K. Exactly right! We had a mold situation in one of our rentals and did the work ourselves. We are not afraid of mold. I did the normal, cut our the drywall, clean with bleach, fix the pipe, and viola, it's done. I saved many thousands that way, and it was a good learning experience for me. I also used a product at Home Depot called Concrobium and rented an atomizer there to treat the inside of the walls. It's like a bug bomb, but it sprays the mold preventer. I think I went above and beyond, but I wanted to be sure the mold didn't come back!

As a side note, I've been in SE Asia for the last eight months, and in Hanoi, Ho Chi Minh, Bangkok, and Phnom Penh, etc. the buildings were literally covered in "black mold" inside and out. You just can't get away from it. It's so humid everywhere. The people are way more healthy than we are (probably a diet thing and exercise thing) with old people running across the streets and riding motos! The Vietnamese would think us very silly for our overreaactions to something as mundane as mold! No one says a word about it.

We deal in a business that by it's very nature is emotional. We deal in people's homes. Their places to live. This business can be tricky, and IMHO, should be dealt with humanely and conscientiously. We are not selling TVs here. We are ****ing with people's lives.

In California, where I am from and run my apartments, landlords are perceived of as being greedy and immoral. (we are about to possibly get statewide rent control) We landlords all need to seriously consider the consequences of these perceptions and our actions. The folks in this business would do well to think about the moral and ethical implications and not just the bottom line. 

Imagine the positive story if this was a story about a landlord that helped this 102 year old woman instead of evicting her? I don't know enough about the dynamics of this particular story, but I would love to see some stories of landlords doing positive things. I think everyone would benefit from that!