shop elsewhere!! :)

my husband and i call RENO home, but 3 of our 4 properties are in small town, minnesota.

the bay area probably has a few random deals, but i wouldn't count on it.

good luck!
--g

Positive cashflow is possible, but there are factors, including purchase price of the property.

San Francisco has one of the 3 highest priced real estate markets in the country (with Los Angeles and New York), so the prices there will be higher than in most areas of the country. There are bargains to be had, though, if one looks for them.

It would seem, though, that the thing to do is not invest for the long term. Look for the short term flips ... where one may be able to make $15-20,000 buying from Peter only to sell to Paul before the purchase from Peter is actually complete and pocketing the difference.

Or ... if one had it, they could put enough money down to keep the monthly payments lower and result in an increased positive cashflow. Of course, that has other dangers (if there truly is a bubble that bursts or something else happens you could be out of a lot of money) ... but there are potential rewards, too. You might get it today and tomorrow there is an announcement that Microsoft is moving to SF and they want your building ... and they're willing to pay $1.4 Mil for it.

As the saying goes, investing your money is risky ... not investing is risky, too. As for how most investors deal with markets like yours ... I can't say how anyone else would do it, but I'd look for properties that have been for sale for a while or those that are underpriced by $5-10,000 to buy and flip.

Some people are tired of reading books ... but there are 2 that I think are essential ... Creating Wealth and No Money Down (or one of its variations ... no money down for the 90's or no money down for the 2000's) all by Robert G Allen. They give great insight into purchasing real estate in all sorts of markets.

Hey mate- The market conditions of SF and most of California do not lend themselves to positive cashflow with no money down.
...You have to go to other parts of the country to get that, and you are also faced with the challenge of finding trustworthy and reliable people to look after your investment (fortunately, I currently have several contacts in other states, and have been able to do this sucessfully).

...BTW- If it is interesting to you, I do happen to have a *very* nice home in Austin for sale right now, which can be effectively and professionally managed for you with no hassle.
(It has designer lighting, hardwood floors, stainless steel appliances, and is on 1/4 acre of land, in a great neighborhood, right in the heart of the city).

I'm selling it for $249K, because I'm looking to get on to another project. But at current mortgage and rental rates, you would easily get a $400 a month net cashflow from the property. Additionally, if you were to build out a rear unit, you could easily bump that up to about $1000 a month.

If that sounds interesting to you, please feel free to drop me a line, and I can send you pictures, further details, etc.

Not in the Bay Area. This area is for appreciation and other areas are for income. The best thing is to buy single family homes in the Bay Area with a negative cash flow, and duplexs or fourplex in other areas, like Texas, Colorado or Oregon. The positive from there covers the negative here, but you get the local appreciation.

Dave, you are right. It's hard today in the bay area to invest. If you count your taxes and insurance as part of your monthly expenses, and get into a loan product that is fully amoratized, then you are looking at a BIG negative cash flow. However, as my husband and I are real estate investors, Realtors and Mortgage Brokers in the bay area we look at it this way - taxes and insurance are not paid monthly to an escrow company (why have them earn interest on your money when it could be working for you?) they are paid when they are due. We use programs like interest only and low start rates to be able to keep the monthly mortgage at a more manageable amount. We buy property in good locations that we can make minor cosmetic improvements upon, hold onto if the rent is right, and then exchange it into something else (instead of an ouright sale so that we won't pay taxes.)

In answer to your question, I don't think that positive cash flow is possible here in the bay area without a substantial down payment or exsisting equity.

Before you invest in real estate, have you taken advantage of the $500K (married filing jointly) that you can make tax free every 2 years?

I know a lot of people buying out of state (Nevada, Oregon, Arizona) but we choose to stick to what we know and avoid all the travel and headache of buying in another state. That way we can also manage our own properties (thereby saving money and keeping control of our tenants).

The key is to “Buy sound, well-located property with profit potential.” as Bob Bruss says. In today’s real estate market, buying an investment property and sitting back to wait for it to appreciate in market value by itself is pure speculation, though a lot of people have gotten richer over the last few years it is far less certain now.

I highly reccommend you check out this website if you are truly interested in real estate investing and wondering which "guru" to believe.

www.johntreed.com/Reedgururating.html

sure, i see these deals. TX has the strongest cash flow in the US right now, it's the #1 investments I've seen.

AZ, OR, rural areas are strong. No appreciation though.

Salt Lake City is well priced now, it should swing back. Office buildings in CA are fine. Conversion deals are sweet if you move fast.

I have a bunch of forclosures, if you want those...return is good, cash flow is soft though. You pretty much make your money on sale, which is 3mo to 1yr after purchase. I have 9 in NV, 2 in OK, 2 in NM.

Sooo, if you just want cash flow, get a 4plex in some town over 50,000 but under 300,000 and you should be fine.


www.RogerV.com
email me off-tribe for fastest response - roger at rogerv dotcom

Hey,

Yes it is possible. There are many people in my RD coaching program who are looking at positive cash flow deals. You just need to make sure to factor in the average costs and reapers. Keep a buffer zone of cash incase of an emergency. Of course it is possible in business as well and investments.

Although I am focusing on the business building aspect right now, I plan on getting into the real estate market soon. I just need to build up some cash reserves first.

Then it’s a matter of finding the right deal. No money down deals are dangerous unless you have a little money saved away incase your tenant moves out or you have a 4 month vacancy or you could go bankrupted and lose the property to the bank with just one or two months vacancy and ruin your credit.

what cities in texas are cash flowing and what product type?

let me vouch for the california office market right now, it still StINKS. the cap rates are stuck in 6-7% range with hardly a basis point spread over where you borrow money. YES, the leasing market is picking up and demand is strong, but investing in commercial product here is totally competitive and there is not a good risk/reward balance in core markets. if you want cash flow in commercial, go to another state or tertiary markets in calif - NOT bay area, SoCal, san diego, etc.

i will give you the DL, when properties are so high look for butchering the cow and that is all. Go to Kansas markets like that where you can buy a house for 120k rent it out and cash flow it for 500 bucks thats the market you want. You need to learn new markets and know that there is a good time to buy cash flow or kill the cow. Unless you need to put capital gains some where and hold onto a large sum hold onto property in SF for 600k and cash flow it for the 2 years then kill the cow and make the 2 years of equity but finanacing it with such a large mortgage is a big risk especially when your getting started.

Positive cash flow is easy to achieve... you just have to go where the numbers support it. We live in the SF Bay Area ourselves and between my partner and I we currently control over 60 properties, with only our home being in California.

We regularly buy rental properties in the $30,000 to $50,000 range that rent for $400 to $500 per month. We can't keep every deal we find though so we also sell/assign some to other people. In fact we have a 4-plex available right now for $110,000 that brings in $1450/month rental income. Don't know how much longer we'll have it, but at this moment we do.

Anyway my point is that it's easily done in places where the numbers support it. We buy in areas of stable employment, and stable rentals. Basically they're "boring" markets. We're not going to see double-digit appreciation, and we don't need to because the properties are profitable NOW. We typicall get between a 20% to 100% cash-on-cash ROI in our first year. It really isn't that hard! =)

Oh and feel free to contact me if you want, always happy to share what we do.

Jonathan
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www.CashFlowRealDeals.com
www.RealEstateInvestingExperts.com