We’ve just completed a review of the data for sales of 2-4 unit income properties in Silver Lake over the past six months. For more on the methodology, please see below. Meanwhile, here are the headline numbers: Median estimated gross rent multiple: 12.7x annual rents Median estimated CAP rate: 5.5% Median sale price as % … Continue reading “Silver Lake Income Properties In High Demand”
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How do apartment buildings increase in value? And how can you benefit?
When you put a bunch of money and time into an asset, you want it to increase in value. Obviously. So you might ask: How does an apartment building increase in value? Remember: An apartment building investment made correctly should cashflow to you every month, so you make money as you go along. But an … Continue reading “How do apartment buildings increase in value? And how can you benefit?”
What can go wrong with an apartment building
Anyone who tells you that any investment is risk free is full of ish. People thought government bonds in Europe were risk free and look where that got them. In order to make sure you don’t think I am full of ish, here’s a list of the things I can imagine going wrong with an … Continue reading “What can go wrong with an apartment building”
Why Westlake Won’t Gentrify
Westlake won’t gentrify for three reasons: the housing stock, the density of apartments and rent control. Regarding the housing stock: Westlake is comprised mostly of apartment buildings built around 1920. Some 1920’s buildings are nice, with great lay-outs, beautiful details, and, in some case, parking. The buildings in MacArthur Park are not those kinds of … Continue reading “Why Westlake Won’t Gentrify”
The Time I Tried to Give Mr. X $5,000 and He Refused
My voice was quivering when I made my final plea: “Please, Mr. X, just take the $5,000 and move out before the sheriff gets here.” The guy refused. He and his wife stayed right up until the sheriff arrived to lock him out of the apartment. I had to appreciate the pride he carried within … Continue reading “The Time I Tried to Give Mr. X $5,000 and He Refused”
How to keep the IRS from stealing your sh*t
Bad news: The government wants to take 50% of the profits from your building. Good news: Some nice legislator long, long ago stuffed the concept of depreciation into the tax code, keeping the tax man from succeeding. What’s “depreciation”? It’s a fake loss that allows you to use to reduce the amount of income you’re … Continue reading “How to keep the IRS from stealing your sh*t”
From the Offer through Removing Contingencies
The advent of services like Redfin and Zillow have made everyone into a real estate genius. You can see what’s for sale, what’s sold, the comps, everything. Don’t let that make you think you know what you’re doing. You don’t. Buying real estate is really complicated. To get that wonderful property you see on Redfin, … Continue reading “From the Offer through Removing Contingencies”
Why you should NEVER release money to a seller prior to closing
If you learn nothing else from this post, learn this: Never release money from escrow to the seller prior to the closing. Let me tell you a story: On our first deal, my brother and I let an inexperienced broker talk us into offering to close in 30 days. 30 days is fine for a … Continue reading “Why you should NEVER release money to a seller prior to closing”
How to find out what an LA property owner paid
One of the hardest things to do when buying a property is figuring out what price to offer. You obviously want to pay the lowest price possible. But most owners are not willing or able to take a loss. So you need to consider what the owner paid for the property. There many different tools … Continue reading “How to find out what an LA property owner paid”
How Prop 13 advantages Los Angeles apartment owners
How would you like to be in a business where the law dictates that your biggest expense grows more slowly than your revenue? That’s what happens for owners of rent controlled apartment buildings with under-market tenants in Los Angeles. Here’s how: As an apartment building owner, your biggest operating expense every year is the property … Continue reading “How Prop 13 advantages Los Angeles apartment owners”