All Forum Posts by: Wes Blackwell

@Edit B.

The reason @Derek Jones is telling you to look at the comps is that, essentially, if you make your home look like those homes, your home should sell for about the same amount those homes sold for.

For example, if you take a look at the other homes in the area and they all have a certain style for flooring choice, then that might be a good hint at what buyers in that area are looking for. 

Ultimately the safest bet is probably laminate in the common rooms and carpet in the bedrooms. Can't go wrong with that. Just need to make good flooring / color choices. 

But almost no matter what you can't go wrong with the HGTV style of grays and white when it comes to flooring and trim. That's all the rage nowadays and will help you get top dollar almost no matter the price range. Best of luck!

@Joshua Dawson

Sending you a PM. I have a great contractor contact that works with my investor clients in Sacramento.

@Adrian Hollifield

Once you're ready to pull the trigger, I highly suggest looking back in the Stockton area. Native myself. The market is on fire right now and it's a great place to invest. My mom still lives in the area and sends me updates everyday about how much her home is going up in value lol. Best of luck!

@Eddie Bridgett Jr

When it comes to investing in Stockton multifamily, your most important consideration is going to be avoiding areas with high crime. You can do this on https://www.communitycrimemap.com/ -- this is the site the Stockton Police Department directly uploads their crime data to per the local government website.

And mainly, you want to avoid violent crime. Car theft, house robberies, etc. happen in all neighborhoods. Assault with a deadly weapon and shooting on an occupied dwelling tend to only happen in the worst.

Having lived there for over 10 years location is definitely #1 as the neighborhood quality can change pretty quickly from street to street, so make sure you work with someone who really knows the area.

Other than that, be sure to do your due diligence on the property itself as @Abraham Bar suggested.

@Paul Choi is a buddy of mine who does quite well with Stockton multifamily, and can perhaps share some insights. Let us know if you have any further questions and we'll try to get you pointed in the right direction.

@Kyle Marek

You should also know that units 2 & 3 in that property DO NOT have a kitchen. So unless you plan on getting a permit for those and paying the cost to install them, kiss this project and your numbers goodbye :-)

And it's much more likely the fourth building is going to need to be torn down than it is likely to be easily converted to a fourth unit.

For anyone wondering how they determined these rankings, the full article is here:

https://wallethub.com/edu/best-cities-for-renters/...

Quality of Life – Total Points: 40

City Satisfaction Ranking: Full Weight (~5.71 Points)

Job Market: Full Weight (~5.71 Points)

Note: This metric is based on WalletHub’s “Best & Worst Cities for Jobs” ranking.

Driver-Friendliness: Half Weight (~2.86 Points)

Note: This metric is based on WalletHub’s “Best & Worst Cities to Drive in” ranking.

Recreation-Friendliness: Full Weight (~5.71 Points)

Note: This metric is based on WalletHub’s “Best & Worst Cities for Recreation” ranking.

Weather: Half Weight (~2.86 Points)

Note: This metric is based on WalletHub’s “Cities with the Best & Worst Weather” ranking.

Quality of Public School System: Half Weight (~2.86 Points)

Note: This metric is based on GreatSchools.org’s ratings of U.S. public school systems.

Safety: Double Weight (~11.43 Points)

Note: This metric measures the violent- and property-crime rates.

Presence of State Bedbug Laws: Half Weight (~2.86 Points)

Note: This binary metric measures the presence or absence of bedbug laws in the state. Bedbug laws address bedbug infestations in rental properties.

@John M.

Sacramento is a unicorn market when it comes to rent growth and appreciation, because you have a large population moving here from the Bay Area where rents and home prices are 2-3x as much for comparable properties. So everyone coming from the Bay thinks it's a screaming deal in comparison to what they're used to.

There's a pretty close correlation between rent growth and appreciation because it's all linked to housing demand. Something is worth what someone is willing to pay for it (rent and purchase price), the main difference being that with purchasing homes you have appraisals and tons of data to keep the growth in check. With rents, you just throw it out there and see if someone will pay it. Rent isn't appraised. 

But ultimately it's supply and demand. Less supply + more demand means you can ask more or buyers/renters offer more in order to win. This should be analyzed on a market-by-market basis because the reasons for rent growth and appreciation differ from market to market.

Here's more info on Sacramento if you're interested:

https://www.biggerpockets.com/forums/621/topics/590913-rent-growth-in-sacramento-is-triple-the-national-average

@Matt K.

See my post here regarding Sacramento Rent Control:

https://www.biggerpockets.com/forums/621/topics/585796-sacramento-rent-control-101-everything-you-need-to-know

@Fiona Humphrey

Just make sure the property cashflows if the owner of the business dies and you're forced to rent to a normal everyday tenant. Your agent in Sacramento should've brought this up and checked those rents for you prior to making an offer.

Often when renting to a residential care facility you'll get higher rent than normal, and if that's what making the deal work just make sure that it will still work if something happens to the facility and you need to rent to a regular tenant. You don't want to get stuck with negative cash-flow because you can't find another care facility tenant to rent it.

Also, probably want to check with your insurance provider and see if all those tenants who are likely to fall and break a hip are going to be an issue for them, and look into the legality of what happens in the care facility owner dies and you're stuck with 5-8 tenants in the home with no one to care for them and no living descendants. That would be a big no bueno.

@Luis Aguilar

Ask the realtor who helped you buy the house. The Arizona Association of Realtors creates forms that Realtors can use for leases, and this should be exactly what you need.