This is the next installment of a 7 part series exploring ideas of why real estate is such a good investment. The focus will be on single family and multifamily real estate, but a good idea is a good idea, enjoy.  Building is a straightforward way to add value. There are really two classifications of it. Either remodeling or constructing. In terms of remodeling, as mentioned in a prior post, it is important to find a 'quarterback' that knows what and who to ask. Improvements should be thought of in terms of how much value it will bring, it has been said that kitchen and bathrooms are the highest return on investment. https://www.remodeling.hw.net   has a very good annual report ( linked here for Los Angeles, see last page ), some highlights is that a MINOR kitchen remodel returns 105% of the money put in. Other things include the expected, Grand Entrance (108.1%), Garage Door (123.8%) and perhaps unexpected, Deck Addition, wood (98.8%), Windows, double pane (102.6%)New ...

This is the next installment of a 7 part series exploring ideas of why real estate is such a good investment. The focus will be on single family and multifamily real estate, but a good idea is a good idea, enjoy.  There are a few advantages to real estate investing in this way, one notable one is the use of leverage. If investing in an alternative asset class, such as stocks, you would buy "on margin" for 50%, meaning, you put up $1 and you borrow $1. In real estate, traditionally, you put up 80%, meaning that that you put up $1, and the bank puts up $4. It technically means that you are the junior partner in this joint venture and you should expect the senior partner to ask for more assurances. For residential real estate, 1-4 units, government-back loan, is no fundamental reason that real estate should have a 30 year repayment term. If you think about, the repayment term is the amount of time that a bank is committed to lend you money at a certain rate. They cann...

This is the next installment of a 7 part series exploring ideas of why real estate is such a good investment. The focus will be on single family and multifamily real estate, but a good idea is a good idea, enjoy.  Alas, today we will be discussing the main thing people think about when they think about real estate investing, selling the asset high after buying low. The biggest advantage to selling real estate is the value added you can do yourself. There is no requirement to hire anyone to do any repairs on the property, as real estate is sold as is. You can do your own marketing, your own negotiating, there does not have to be anyone between you and the market unless you choose for there to be. You choose your partners at terms you both agree with. With that great power, comes great responsibility. Though you can do it yourself, it is more advisable to partner with those who do it every day, rather than every so often. Consider that a real estate transaction employs a...

This is the next installment of a 7 part series exploring ideas of why real estate is such a good investment. The focus will be on single family and multifamily real estate, but a good idea is a good idea, enjoy.  Today we are exploring using real estate as a rental property. It is the most common use for investment residential real estate, the first question is whether to go with short-term rentals, or long term (fixed term) rentals. For short-term rentals (Airbnb or similar), first make sure about city ordinances, for example,  City of Anaheim  has extremely restrictive rules relating to short term rentals. The rules can be many, burdensome and ever-updating, in fact, I would not recommend doing short term rentals in Anaheim at all. In addition to cities, HOAs (Homeowner's Associations) are common in areas that have high Airbnb demand, and  they have not been friendly to it either . Secondly, please note that short-term rentals have the primary com...

Today's topic is a bit of a macro topic, we would like to look at why exactly is real estate such a good investment. Please consider this 7-part blog post to be a primer rather than the authority on the topic, its purpose to think about things in a new way. There are seven things we can do with real estate: Use it  Rent it Sell it Finance it Improve (Build on) it Tax Benefits Legacy Today we talk about 'using' real estate. As simple as it sounds people do not fully appreciate home-ownership as a concept; there is really only 4 living status you can have: own, rent, live with family, homeless. The road to homelessness is not as far as people think.  78% of Americans are living paycheck-to-paycheck . If a renter lost their job, eviction proceedings will likely begin 3-5 weeks from when the rent is due, depending on landlord. If a homeowner (in California) is laid off, they have up to 3 months to pay prior to receiving a notice of default, then 3 months before ...