All Forum Posts by: Vineet Bindal

@Eduardo Zepeda very well explained. I missed out on the fact that negative cash flow would it would damper my savings rate from $30k/yr down to $25,020 per year(based on your example). 

@Ned J. Thank you, great advice. 

@Dreton L. Thank you for the suggestion. In general in Bay Area, I haven't seen builders offering a lot of discounts on new Homes. This home is comparable to the recent sales in that area, Its a very good location in that area,  off-course being new construction it carries some extra price.  But  so far I haven't heard of 100K+ discount on a new townhome construction in San Jose. I don't think builder would have priced a new home really high thinking lets try if we can sell otherwise we will give 100K discount. I know for a fact that this builder did pay a pretty good amount to acquire that land as-well. It was one of the most expensive land deal from the builder in that areal last year. I think the market dynamics have really changed in last 2-3 months and they are struggling with the inventory even in bay area.

@Eduardo Zepeda, @Cody L., @Dan H., @Dreton L.@George Lods, @Jaysen Medhurst, @Amit M. Thank you all  for your insights. Before I started this threadI had put in a verbal offer for $100K less than the asking prices(in $900s) and the builder seems to be agree to my offer. I was skeptical if they would agree at that price but this seems like a total buyers market right now. 

I feel I should have gone for $150K less on the price tag. I would appreciate some more thoughts. 

@Dan H., @George Lods you both bring up very good points. I agree that Silicon Valley prices are close to all time peak(after seeing some correction in certain areas recently). But I also see a lot of people still waiting to buy even their first home or waiting to upgrade. So for longer term I would say 10 years It will play out well unless there is a great recession. This fear is what stopping people on jumping new properties right now in my opinion

I have  looked at other areas as well. Portland( already expensive) Raleigh, NC is another area which I can think of but I have no team/contacts there. 

I was trying to stick to my backyard rule because of the backyard rule(1). I know for sure there are a lot of tech people waiting to buy(2). There are a lot of people who are trying to move into bay area for tech(3).  But prices being all time high and some of the points shared above, It is a bit risky.

@Blake Edwards Do let me know If you come across something. I will be interested to look. 

Thank you guys I will continue the search. 

@Jaysen Medhurst, Thank you for the input. Its being my first investment I would like to stick to the backyard rule but browsing this forum and looking around me I am not sure If a cash flow positive property can be found in bay area with a budget of budget of <800K

I am a new investor and have been lurking this forum for a while. I would appreciate if folks can give me their prospective and POV on below choice:

A bit about me: 

- New Investor.

- Currently owns my own home with only comfortable amount of mortgage left. 

- Trying to buy a property to rent out and for price appreciation over next 5-10 years. 

Pros about the property: 

-Its in my backyard, 5 minutes drive from my home. 

-New Home so no post transaction surprises. 

-proximity to public transportation

-Its in San jose area so its easy to rent

Cons about the property:

- New home so it will be a bit expensive

- Bay area property prices are high and rent doesn't meet the 1% rule. 

- Cashflow will be negative.