All Forum Posts by: Varun Parkash

You are right, the chance to find a property in California that fit in the calculation you learn from BP is very slim.

I might have never found a deal if using the calculation from BP like 1% rule or 2% rule.

However, I was able to buy a lot of properties because I lower my expectations, I didn’t follow their rule. And I still able to reach the goal of financial freedom already. I have enough cash flow and left my W-2 job after 5 years of investing.

I purchased properties with 0.7% or 0.8%.
Sometimes, I purchased with -$100 negative cash flow each door for appreciation, and it worked.

Considering the above responses and an online research I am able to short list the following cities:

OKC Metro OK, Jacksonville FL, Fort Worth TX, Dallas TX, Orlando FL, San Antonio TX.

Thanks to all for your suggestions. 

Any other advise or guidance on this topic would be greatly appreciated..!!

@Sandro Hagenbuch I am always 100% honest about my intensions when working with anyone. I have found it to be the best policy. With that said yes, I did let them know I was looking to see who could provide me with the loan package I was seeking. If your not shopping you loan I feel you arent doing your job as an investor. 

With respect to timing it has to do with a couple of factors. First and foremost you are looking to get approved by their underwriting. They will then send a letter stating what terms they are offering. You can negotiate on some of these terms and usually there is a timeline to accept. You are also looking at your desired closing date and determining how much time the appraiser needs and anything else required prior to closing. 

Sounds like a tough situation you got in. In my initial interviews with banks to see if they can work with my deal structure I ask them what their process is for underwriting deals. Typically the banks that say they can get it done in a few days I havent had luck with when getting creative as they underwrite the easy deals quickly. But give them all the ammo they need to underwrite the deal and generally I have experienced 1 to 3 weeks. Sometimes, depending on the size of the loan request a board approval is required which could delay the process further depending on how often the board meets. 

@Varun Parkash  That's a pretty broad question, and is tightly location-dependent.  Cumming itself is a very small city, but which dominates Forsyth County.  In the past couple of years for certain segments of Forsyth County and Cumming, I've been seeing sales prices going up each year by 10%-15%, though that has slowed in the last 5-6 months, it seems.  In the Northeastern part of the county, though, appreciation has been much slower.  Residential construction is difficult in Forsyth County for properties not in a subdivision, so I've been seeing an uptick in prices for un-built lots in subdivisions, but a bit of a plateau in prices for lots of land less than 10 acres.

Perhaps wait for Amzn headquarter#2.

Googl downtown SJ office center was announced a few months ago here. In 95126 there is all kinds of speculation. TH I sold for $500K 4 years ago sold again for 825K 20 months ago is 1.15M..... 

I commend you for seeing that if you condo is not or no longer a good investment, to sell and find something that works better for you.  I have done the same thing over the years. 

If you like Class A, you may enjoy the relatively close by area of Temecula, CAlif.  You can get a decent house for $350K, low taxes, built 1990-2002, newer area, great schools, low crime, excellent tenants and low vacancy. Appreciating area steady.

Just a question- if you are breaking even on the property, why do a 1031 exchange?  If there is no gain on sale, there are no taxes due, no?  No point in locking this money into 1031 if there is no gain anyway. 

 The very DEFINITION of Class A is that there in a negative initial cash flow. Then because of rent growth and appreciation, Class A properties are the most profitable for investors. If you buy a property (that wasn't a complete gut remodel, and even then its suspect) that cash flows on Day 1, it is not Class A (by definition). Even my Honolulu properties that now cash flow $500-1000 per month, are Class B now and Class B when I bought them.