Rental Property

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ixamxkevin
Posts: 10
Joined: Tue Mar 29, 2016 3:05 pm

Rental Property

Postby ixamxkevin » Sun Mar 19, 2017 11:52 pm

Hi All,

I am trying to learn more about investing in rental properties. Any suggestions on books, articles, etc to read would be awesome. Some questions if possible...

1) Is this a good time to purchase a rental property with interest rates being lower? I would not be able to purchase the property in cash and would have to take out a loan.

2) I currently live in Bakersfield CA. Where can I go to find more information on rental property in this area? That is, if the rental situation in this area is good?

Thanks for any input

Best,
Kevin Wang

Rmats
Posts: 10
Joined: Tue Mar 14, 2017 5:55 pm
Location: CA Bay Area

Re: Rental Property

Postby Rmats » Mon Mar 20, 2017 12:10 am

Check out https://www.biggerpockets.com. They have a pretty good community. The Fed is expected to increase rates again twice this year so now is a good time to lock in a low rate.

DVMResident
Posts: 1006
Joined: Mon Aug 01, 2011 8:15 pm

Re: Rental Property

Postby DVMResident » Mon Mar 20, 2017 12:30 am

My go-to fiscal resource for RE is "What Every Real Estate Investor Needs to Know About Cash Flow And 36 Other Key Financial Measures" Frank Gallinelli. This book will walk your through the math of rentals and empower you to evaluate each property. My go-to legal and tax resources is NOLO: Every Landlord's Tax Deduction Guide. There are also state specific legal guides. NOLO does a good job of making complex topics understandable.

To question #1: No, it generally is not a good time to buy rental properties. Most markets are overheated, especially in CA, though I don't track Bakersfield specifically. The low interest rates are being offset by the high prices.

Question #2: Much of the information is public (Redfin, Zillow's sale history), though local networks are very helpful for scouting upcoming units. There is a pretty steep learning curve here. I'd suggest starting with reference material and applying to everything this that pops up in your target area for 6~12 months to start to understand your local market as it related to the rental market: school lines, transportation access, flood risk areas, etc.
Last edited by DVMResident on Mon Mar 20, 2017 9:41 am, edited 2 times in total.

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Bogle_Feet
Posts: 721
Joined: Tue Jan 14, 2014 6:56 pm

Re: Rental Property

Postby Bogle_Feet » Mon Mar 20, 2017 3:52 am

Do you also have stock and bond investments? Keep in mind that real estate is taxed at a higher rate. If you're madly in love with real estate then consider a real estate index fund or stock. No headaches.

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knpstr
Posts: 1149
Joined: Thu Nov 20, 2014 8:57 pm
Location: Southern Michigan

Re: Rental Property

Postby knpstr » Mon Mar 20, 2017 7:03 am

Biggerpockets is the website forum you'll want to look through.

Landlording - Leigh Robinson
Millionaire Real Estate Investor - Gary Keller
Books by John T Reed

Those should get you started.

Real estate investing is a "job" in the sense you can't ignore it completely like stocks. But it isn't a "job" like and 9-5. It certainly isn't headache free by any means. I read up on resources and books about 1 year straight before pulling the trigger.

1. Low rates are good for debt service costs. But beware as rates continue to raise, the value of you one's property will tend to go down (or not grow as fast).

2. Just start at Realtor.com and familiarize yourself with property values. Look at it daily, recently sold, how long listings have been listed, etc...

Good luck.
:beer
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

Liberty1100
Posts: 140
Joined: Fri Nov 21, 2014 12:36 pm
Contact:

Re: Rental Property

Postby Liberty1100 » Mon Mar 20, 2017 7:38 am

I second biggerpockets.com, but I warn you that they seem to wear rose-colored glasses sometimes.

I recommend picking up:
1) The Book on Rental Property Investing: How to Create Wealth and Passive Income Through Intelligent Buy & Hold Real Estate Investing! - It provides you with everything around purchasing and what it takes to make it a real investment vs a job.
2) What Every Real Estate Investor Needs to Know About Cash Flow... And 36 Other Key Financial Measures - This book provides you with a foundation of the numbers and terms used in the financials of rental property investing.

Sidney
Posts: 6563
Joined: Thu Mar 08, 2007 6:06 pm

Re: Rental Property

Postby Sidney » Mon Mar 20, 2017 7:45 am

Spend some time with other people who own rental property. Perhaps arrange for a few of your friends to call you for a favor in the middle of the night or just as you are about to sit down for Thanksgiving Dinner.
I always wanted to be a procrastinator.

renue74
Posts: 629
Joined: Tue Apr 07, 2015 7:24 pm

Re: Rental Property

Postby renue74 » Mon Mar 20, 2017 7:54 am

Sidney wrote:Spend some time with other people who own rental property. Perhaps arrange for a few of your friends to call you for a favor in the middle of the night or just as you are about to sit down for Thanksgiving Dinner.


There's a prevailing "rental property is a job," mentality that many folks have. It can be as much or as little a job as you want it to be. I own 4 properties and do get the occasional "I have a water leak," text message.

If you pursue rentals, you can price in a property manager if you don't want to get those calls. Or you can put together a team of go to vendors. I have an HVAC, electrician, and plumber for all my mechanical go to issues. I just had a plumber change out a hot water heater this past weekend. Other than me texting him and telling him it needed to happen...that was my role.

Alto Astral
Posts: 604
Joined: Thu Oct 08, 2009 10:47 am

Re: Rental Property

Postby Alto Astral » Mon Mar 20, 2017 11:44 am

I personally know somebody who does this. They know basic plumbing and electrical work and get vendors for bigger jobs. From what they say, they are content.


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