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2020 Investment Thread

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I believe an additional ~10% of rent goes to the management company. I'm also thinking about either purchasing a rental prop or investing into an REIT next year once we see/start seeing the effects of so many people out of work.

dagle, have you asked your friend what they've used for research? sounds like they have a plan, maybe hit them up? If we see a housing market downturn that I believe we'll see by q3 next year, all 20-30 houses will lose value, a certain % of renters may not be able to pay. I would guess, though, that they have a plan for this. It would be interesting to know what that plan is, so if you ask, please share. thank you.
 
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Covid-related complications aside, this is not a good time to buy into real estate as an investment from a timing perspective. The current appreciation cycle is very long in the tooth.

I'm trying to get my last tenant out (with little luck so far) and I will NEVER be a landlord in California again. Here's a good example of why.

The state is slowly adopting ridiculous SF-style tenant "protections" that will drive more and more people out of the business.
 
Way back in this thread Rental property income was listed as one of the best sources of income for retirement. I would like to see the cost /benefit vs dividends. I'm sure risk/reward comes into play a lot.

Its hard to get around taxes anywhere, but I have found that you have to go out of state to find the right rent to purchase price that cashflows from day 1.

I could cash flow with the place that I live in Campbell, but I bought it in 2007.

I'd be interested and capable of buying something out of state, it's just a significant hurdle for me (mentally) to shell out that much money for something sight unseen and trust local management companies to deal with tenants and rent and maintenance.
 
Covid-related complications aside, this is not a good time to buy into real estate as an investment from a timing perspective. The current appreciation cycle is very long in the tooth.

I'm trying to get my last tenant out (with little luck so far) and I will NEVER be a landlord in California again. Here's a good example of why.

The state is slowly adopting ridiculous SF-style tenant "protections" that will drive more and more people out of the business.

re: rent capping at a % increase each year - how does that square up against the new proposals on changing property tax increases by current value vs purchased value?
 
Down to one rental now. Had problems with renters in a house not paying. Took a few months to get them out. Got them out February so that was luckily.

Second renter lost his job due to covid. Reduced rent from $1200 to $800 just to keep money coming in. In 9 months I went from $2600 a month coming in to $800. Everything was paid off so I could absorb the hit. But if I had 20 properties do that, I would be bankrupt.

I am thinking of getting another rental in 2021. Both rentals were in northern Nv which has great laws for owners.

Covid-related complications aside, this is not a good time to buy into real estate as an investment from a timing perspective. The current appreciation cycle is very long in the tooth.

I'm trying to get my last tenant out (with little luck so far) and I will NEVER be a landlord in California again. Here's a good example of why.

The state is slowly adopting ridiculous SF-style tenant "protections" that will drive more and more people out of the business.

Good reminder about owning rental properties in CA. With Reno so close, maybe it's a better area to look at. Of course if you really wanted to be hands off, then the map is wide open.

The timing thing is tough. You hate to throw money away, especially percentages of large numbers, but there just doesn't seem to be any correction activity in sight.
 
If looking at rental properties look at high end places. My current rental is a condo in downtown Reno. Precovid I was getting $1200 for 650 sq feet. You can get a house for around $2000 a month.

All the tenants have been very good professionals. I use a placement company to find renters. even the current one who is out of work wants to keep paying not not screw up his credit. They also all seem to take pride in where they live. The place has always been left in good shape. I have had about 6 tenants in 8 years.

The problem with a place that small is people move on once they get used to the area.
 
speaking of which, anyone own income properties and know of any good resources to read up on? i have a friend who "owns" like 20-30 houses in a few different states but he just rents them and has property managers fix things when he needs them. i guess since the loans are leveraged its not a big deal but i found it odd that he has that many loans out at 30 y/o.

I know about a dozen people who were doing that in 2008. In 2010 they were all stony broke and owed large amounts of money to banks, and lost their houses.
 
Covid-related complications aside, this is not a good time to buy into real estate as an investment from a timing perspective. The current appreciation cycle is very long in the tooth.

I'm trying to get my last tenant out (with little luck so far) and I will NEVER be a landlord in California again. Here's a good example of why.

The state is slowly adopting ridiculous SF-style tenant "protections" that will drive more and more people out of the business.

1000% this.
 
If looking at rental properties look at high end places. My current rental is a condo in downtown Reno. Precovid I was getting $1200 for 650 sq feet. You can get a house for around $2000 a month.

All the tenants have been very good professionals. I use a placement company to find renters. even the current one who is out of work wants to keep paying not not screw up his credit. They also all seem to take pride in where they live. The place has always been left in good shape. I have had about 6 tenants in 8 years.

The problem with a place that small is people move on once they get used to the area.

Was looking at some condos, specially Shoreline Villas in Reno because they're pretty affordable and it looks like a nice complex, but those HOA dues are a real turnoff.

I know about a dozen people who were doing that in 2008. In 2010 they were all stony broke and owed large amounts of money to banks, and lost their houses.

Right? :laughing
 
There are places in Foster City that are ~1200 sq ft, 2 bed / 2 bath, $850k sale price....with $800 / month on top of that in HOA fees.

I can top that.. in DALLAS .. $7-800k 2br in a high rise with 1.5-2.5k+/mo in HOA... property tax is another beast altogether

:wtf
 
I can top that.. in DALLAS .. $7-800k 2br in a high rise with 1.5-2.5k+/mo in HOA... property tax is another beast altogether

:wtf

WTF indeed...but I'd also bet that's closer to the top of the market for Dallas, while it's like lower 1/4 of the market for the bay area.
 
There are places in Foster City that are ~1200 sq ft, 2 bed / 2 bath, $850k sale price....with $800 / month on top of that in HOA fees.

When I was working in SF, back in the day. And fuck, this was easily 25 years ago, I took a look at job in an apartment on Broadway in Pacific Heights. This is the truly expensive area. It was a co-op building. You bought the apartment and then paid a monthly co op fee.

The owners were a mom and her forty year old son. Sonny looked like he had never worked a day in his life, and wasn't about to start doing so anytime soon.

Posh comes to mind. Anyway, all the way back, then the co op fee was $5k a month. I imagine it's twice that now.
 
speaking of which, anyone own income properties and know of any good resources to read up on? i have a friend who "owns" like 20-30 houses in a few different states but he just rents them and has property managers fix things when he needs them. i guess since the loans are leveraged its not a big deal but i found it odd that he has that many loans out at 30 y/o.

When you do the ROI, the bigger loan you get, the better the ROI. More money to buy another unit. The renters pay the Taxes, Principal, Interest, management, ect.

I 'own' 1 bedroom here and many bedrooms out of state. Similar situation.

The book "Rich Dad, Poor Dad" is how I started. Its more business philosophy than nuts and bolts, but its a easy read.

I'd be interested and capable of buying something out of state, it's just a significant hurdle for me (mentally) to shell out that much money for something sight unseen and trust local management companies to deal with tenants and rent and maintenance.

Its easier than buying a home here. I am on my 4th property managers. I bought my first out of state property ~2006. You can fly out there. Its a tax deductible work trip. Lots of tax benefits.

The more properties you have the Property management give you a volume discount - say down in the 6% range.

My mom is a real estate agent and always wanted me to buy a large place around here. I ran the numbers of buy here vs income properties out of state and rent here. The numbers are much better with income properties out of state.
 
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I can see the appeal of real estate, using the banks money to generate income. Not liquid enough for me though. I like being able to get out of an investment overnight if needed. That need has never really come up though but having the option is like insurance for peace of mind.

I probably wouldn’t sleep well knowing I have what turn out to be deadbeat tenants living in a property I own and dealing with eviction notices and ransacking repairs.

Note you are renting the banks money and using the renters money to pay your rent. :teeth

"Using other peoples money"
 
Nope, and that's why I'm staying out of it. I bought 10 shares a while back and I'm just sitting on them that's it. Not even gonna attempt to trade that one actively.
 
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