Investing 102

[GregWeld]

Originally Posted by frankv11

california is definitely a tenant's state. I bought a triplex at trustee sales recently. 2 units were occupied and 3rd one was vacant (was told by neighbor) by the time I got trustees deed and recorded. some one had moved in and demanded cash for keys and so did the others ( rediculous amount otherwise I would have payed out). in california tenants get a 90 day notice before you can even begin eviction process. I will not buy rent controlled real estate , that is another ball game
so any how , got an eviction lawyer working on it.
3 units 1B - 1B each, 2000sqft , 10,000sqft lot
plan A
Rehab them completely. refi and hopefully get all my investment back while generating about $1000.00 a month.

plan B same as above but add another unit. zoning and lot size allows it. need to work out numbers w architecture and $$$ / sqft etc....

I got a pretty decent deal so I think there is enough room to get all of my initial investment and I'll do 90% of the work my self.
It is really hard to get to get a deal at auction like todd said. people are paying market value and above at times. A lot of Hedge fund money out there, I hear.
If you know the game and stay persistent it pays off. hoping to get out there again soon. just not to sure where market is going and don't want to get caught at the peak of the " W "

It's these kinds of tales that keep me out of the individual unit investments.... I invest in large apartment LLC's that are professionally managed -- get really nice returns (7 and 8% annual cash interest) ... upside cap, if any when they're sold... income tax depreciation.... and no phone calls about someone's toilet plugged up!

[Vince@Meanstreets]

Originally Posted by GregWeld

It's these kinds of tales that keep me out of the individual unit investments.... I invest in large apartment LLC's that are professionally managed -- get really nice returns (7 and 8% annual cash interest) ... upside cap, if any when they're sold... income tax depreciation.... and no phone calls about someone's toilet plugged up!

That's where investing into an organized property maintenance company would come into play.

With proposition 19 in play back in 2010 your other reference would have been a great move but you would have to keep it low key. I was planning a nice 10,000 sq ft green house where we would cultivate "artichokes" and sell to whole sale sellers. Since 19 failed I will not risk the move. I love my guns too much on that risk. I haven't been a user since the 80's but I think it could have been a good cash crop.

Since we are on a commercial flow, what would you do with 12 acers of high desert just out side of Lancaster? 5 miles from hwy 395 and hwy 15?

Mini-mall? Retail coops? Self Storage complex?

[GregWeld]

Originally Posted by Vince@MSperfab

Since we are on a commercial flow, what would you do with 12 acers of high desert just out side of Lancaster? 5 miles from hwy 395 and hwy 15?

You don't even want to hear what I think about investing in Landcaster, or that area, let alone investing in ANYTHING that's in California...

I love California - but not as an investor. Way too many tree huggers and laws there. The criminals have "rights" - the renter that doesn't pay has "rights" - the border hoppers have "rights". No thanks!

Dump the property and buy some good stocks....

[Bucketlist2012]

Originally Posted by GregWeld

You don't even want to hear what I think about investing in Landcaster, or that area, let alone investing in ANYTHING that's in California...

I love California - but not as an investor. Way too many tree huggers and laws there. The criminals have "rights" - the renter that doesn't pay has "rights" - the border hoppers have "rights". No thanks!

Dump the property and buy some good stocks....

Haha....No doubt...That is why I will one property...The one I live in..I may move in the next few years to my forever home, but I will not keep this one..
Mainly for the reasons you mentioned..

I don't need a squatter laughing at me while he doesn't pay for several months...My health cannot take the stress and I won't do the jailtime for what I would do...

I would still stay in California due to family, but I don't have the stomach for the laws and rights given to squatters...

[glassman]

Some of my clients that are high end boutique resalers have said there are two California's for investing, coastal and "other". They've all said stay away from " other". There are exceptions to that of course, but when were in the game of numbers...

[frankv11]

When I buy such property. I have already taken into account eviction , holding time , repairs etc... All that has to be factored in. As long as the numbers make sense and oppurntunity strikes and if I have the means I'll be all in.

For example on above mention property. If there is no drastic change in market. I should get all of my investment back in six months. it will pay for it self while generating a profit and if there is a bit of room maybe ill pay my self a bit on the front end. With today's interest it would be a sin not to keep it. If I could keep one or two of those a year. Maybe I'll be able to get a professional management firm when I'm 45
Plan C , which is not really in my plans would be to sell and profit an avarage of $70k before taxes.
Now that is just my point of view we are all at a different stage,money wise career, family goals etc... So most definitely not for everyone but do what you know works for you.

[GregWeld]

Good post Frank... and the part I like the best is that you understand that everyone has differences. So ideas are just that... ideas -- and they can be
modified... used in part or in whole etc.

Doing what someone understands and has intimate knowledge of - to me - is the best way to invest. They see and understand the pitfalls. They have a better sense of changes - good or bad etc.

The main part of this entire thread is just to get going and do SOMETHING - save - invest - start early. Make your own "luck".

[Vegas69]

I like your statment about making your own luck.

I was speaking to a physician client of mine yesterday and he was talking about how lucky he is to have his position. Then he started talking about all the training, meetings, interviews, and decisions he made over the years.

I went on to tell him luck likely had some play but a majority of his luck was self made. You don't get lucky being a couch potato.

If you want things to change, YOU must change. Whether it's you skill set, education, health, relationships, finances, whatever....

[GregWeld]

Originally Posted by Vince@MSperfab

Mini-mall? Retail coops? Self Storage complex?

My brother in law builds and invests in Mini Storages. He has people that have been doing just that - for 25 or 30 years now. They have a very specific set of demographics/cost per square foot/size of property etc that absolutely must be adhered to. Any time they've ignored them - the property hasn't worked out.

Having said that...

These things are the most amazing cash cows I've ever seen. Most of the time Eric tells me that they're all rented out before they ever get an occupancy permit finished. The ones they build have on site live in management. For most of the units there is very little effort on managements part... the few that fail to pay get locked up and the contents sold to people that do that kind of work. He told me once that the biggest job is keeping the electronic gates working 24/7.

[Bucketlist2012]

LUCK..

If you read my signature, you understand what I think of luck..
It is the meeting of preparation and opportunity..

It takes both to make it work..