Just had what I think is an interesting debate over on Facebook with my friend Conor Neu, a very successful trader. Thought it was worth re-printing in part here: I originally wrote: “Success as an investor is about figuring out how to take big bets where you lay the risk off on someone else and … Continue reading “What makes a great investor?”
Category: Buying
More thoughts on Toland?
We’re still discussing this property: Toland Offering Memorandum We’ve had two very useful contributions so far. You can check them out here. Want to get involved? Take a look at the original post, then put in your $0.02. Do you like the property? Is it cheap or expensive? What should a buyer be looking for? We … Continue reading “More thoughts on Toland?”
Who’s in?
We’re still looking for readers to contribute to our multi-family analysis from yesterday. Are you interested in learning how the pros evaluate property? Take a look at the questions I posted yesterday, grab the marketing package on the property: Toland Offering Memorandum. And post some observations / comments for the rest of us…
Right now, you need soft eyes
There are no perfect deals right now. Think about it: People don’t generally sell perfect buildings where everything is going great. They definitely don’t right now, when the alternative to owning the building is to hold the money in their money-market account earning 0.25%. Does that mean you shouldn’t buy anything? No. There are definitely … Continue reading “Right now, you need soft eyes”
How to think about debt on a single family house
Have been helping a few people make FHA offers on 3-4 unit apartment buildings. The lenders are very interested in making sure that the buildings are self-sufficient (in other words, that the cashflow from the buildings covers enough of the mortgage payments, taxes, etc. so that the building isn’t a drag on the borrower’s cashflow). … Continue reading “How to think about debt on a single family house”
What’s a prelim?
When you buy a property, you want to be pretty damn sure that you’re getting clean title. In other words, you want to be sure that no one else has any claim to the property you are acquiring. During the inspection period described in the purchase agreement, the buyer has the chance to review and … Continue reading “What’s a prelim?”
The Magic Number for FHA Loans
12. That’s the magic number for FHA loans on 2-4 uni apartment buildings. It stands for 12x the annual rents. Why is 12x grm the magic number for FHA loans? 12x a building’s total annual rent (including the fair market value rent of the unit you will occupy) is basically the maximum price you can … Continue reading “The Magic Number for FHA Loans”
More on the state of the apartment market
This is a verbatim quote from an email from an agent listing an apartment building in a nice part of the Valley: “Yes, it is available, but seller is now asking $50k over listing price. Need an offer all cash at listing price or above no contingencies. That is the only way.” I’m keeping the … Continue reading “More on the state of the apartment market”
What is the Los Angeles REAP program?
Spend enough time looking at Los Angeles apartment listings and you will find one that says something like “Property in REAP. Looking for an all-cash buyer”. Or, much worse, you might get a letter from the Los Angeles Housing Department (LAHD) threatening to place your property in REAP if you don’t comply with their demands. … Continue reading “What is the Los Angeles REAP program?”
Our latest project
We recently closed on a 5 unit property in Echo Park which we’re doing with a partner. They put up the dough and we’re handling all the work of buying out the tenants, designing the renovation, doing the actual construction, and then leasing the newly-renovated units. When all is said and done, our partners will … Continue reading “Our latest project”