I was recently asked by a client to explain why she should consider using debt to buy an apartment building. After all, having a mortgage would decrease the amount of money she had left at the end of the month. And, since she has a bunch of cash and she’s buying buildings to build a … Continue reading “How paying a mortgage can INCREASE your cashflow”
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A confession
I’m a Redfin junky just like everyone else. I spend some time every day looking at single family houses in Eagle Rock, the Hollywood Hills, etc. I also look at properties in Big Bear and along the coast in Oxnard and Ventura. I even occasionally look at big spreads out west where land is ludicrously … Continue reading “A confession”
More about wealth managers
Further to my previous post about wealth managers and why they’ve never called me, here’s an interesting NY Times article about the business practices of the wealth management team at JP Morgan Chase. It’s a pretty interesting piece and I would recommend giving it a read, but, if you’re busy, here’s the money quote: “These … Continue reading “More about wealth managers”
How banks (should) think about risk
Have you ever wondered why banks think in terms of debt service coverage ratio (DSCR) and loan-to-value ratio (LTV) when they’re considering whether to lend you money to buy property? They’re really thinking about two different things: 1. Whether you’ll be able to pay the mortgage (DSCR test). This is where the DSCR comes in. … Continue reading “How banks (should) think about risk”
How to buy an apartment building when you don’t have income
Sometimes people come to me with the following problem: They have a bunch of cash, but they don’t have much (declared) income. They want to buy an apartment building but they don’t know how. It turns out that it’s much easier to help these people buy 5+ unit buildings than it is to help them … Continue reading “How to buy an apartment building when you don’t have income”
How to decide what to offer
Every time I help someone buy an apartment building, we get to a moment where we need to figure out what our “best and final” offer will be. Literally 100% of the time, my client asks me what I think it should be. And this is maybe the one question in the entire process I … Continue reading “How to decide what to offer”
Questions (redux)?
I’m still looking for more questions about apartment buildings from readers. I speak with many of you every day, so I know that you’re not all little real estate geniuses (not that I am, by any means!). There are definitely things you’re unsure of. And if you’re unsure, you can bet your bottom dollar a … Continue reading “Questions (redux)?”
Atwater Village Rent Survey – June 2012
Continuing our look at Eastside rents… As usual, we looked at ads posted on Craigslist for apartments within the boundaries of Atwater Village as defined by the LA Times neighborhood mapping project. A few things to note: These are asking rents; you could potentially negotiate them down This particular survey took place towards the end … Continue reading “Atwater Village Rent Survey – June 2012”
Do I see any good deals?
Recently, people keep asking me if I see any good repositioning / flip deals to do. And my answer boils down to this: Yes, but only for certain types of investors. Here’s what I mean: Right now, prices for apartment buildings, especially small apartment buildings, are high and rising. A year ago, you could buy … Continue reading “Do I see any good deals?”
Why no wealth manager has ever called me
Do you know that no wealth manager has ever called me about getting his clients into apartment deals? I’m not saying I’m famous or anything, but this blog does come up fairly high in the Google results if you start looking for information on apartment investing in Los Angeles. There are literally thousands of people … Continue reading “Why no wealth manager has ever called me”