I bought a house in Salinas last year and have been earning positive cash flow since last August, and the price has come down quite a bit since then. 10% ROI is quite easy. You can get up to 20% ROI on the best deals.
The fact that you have a few hundred K in cold hard cash is a huge advantage. Learn how to do title research and bid at government foreclosure sales at the courthouse.
Check out http://www.fidelityasap.com for the sales in the past 7 days. (For example, choose the city of San Jose, and search for the word "sold". Ignore the ones that whose sales status is Sale Status: Back to Beneficiary, nobody wanted these. We want to see what experienced investors bought). And we see, as an example:
1317 Soto Ct San Jose, a 3/2 1200 sq ft house built in 1969(zillow.com) selling for $220K. Notice that no one bid against this lucky buyer. Spend, I dunno, $20K fixing it up, worst case. Get a mortgage for 25% down, 7%, 30 year fixed. That's $55k down, $1100 a month or so in PITI. You rent the house out for $2000 a month(check craigslist for real numbers).
So you're getting $900*12 / $75K = 14.4 % ROI AND they are paying off your mortgage for you AND you're saving on your taxes. And the house will appreciate in value, you hope.
The general rules is, the ROI is higher for more ghetto neighborhoods. Modesto, Stockton, and Salinas has higher ROI than the Bay Area, but they are 1.5, 1.5 and 1 hour away from Santa Clara, respectively.
It's not rocket science. It's important to be patient, learn the rules, and compare lots of numbers, but the hardest part is having the MONEY, and you've got that already. I'm an young engineer with a day job, the above I picked up over about a year and a half on the side.
The reason I'm posting this is to meet other people interested in this stuff. Drop me a message at istarist @gmail.com, if you are.
I'm surprised everyone here dances around the issue rather than using brute force.
I own 4 alarm clocks, which I set to go off at 5 minute intervals. I also stuff small wads of paper into the alarm on-off switch, to force myself to use the snooze button. 20 minutes from the first alarm, I have 4 alarms going off a few seconds apart.
I bought a house in Salinas last year and have been earning positive cash flow since last August, and the price has come down quite a bit since then. 10% ROI is quite easy. You can get up to 20% ROI on the best deals.
The fact that you have a few hundred K in cold hard cash is a huge advantage. Learn how to do title research and bid at government foreclosure sales at the courthouse.
Check out http://www.fidelityasap.com for the sales in the past 7 days. (For example, choose the city of San Jose, and search for the word "sold". Ignore the ones that whose sales status is Sale Status: Back to Beneficiary, nobody wanted these. We want to see what experienced investors bought). And we see, as an example:
1317 Soto Ct San Jose, a 3/2 1200 sq ft house built in 1969(zillow.com) selling for $220K. Notice that no one bid against this lucky buyer. Spend, I dunno, $20K fixing it up, worst case. Get a mortgage for 25% down, 7%, 30 year fixed. That's $55k down, $1100 a month or so in PITI. You rent the house out for $2000 a month(check craigslist for real numbers).
So you're getting $900*12 / $75K = 14.4 % ROI AND they are paying off your mortgage for you AND you're saving on your taxes. And the house will appreciate in value, you hope.
The general rules is, the ROI is higher for more ghetto neighborhoods. Modesto, Stockton, and Salinas has higher ROI than the Bay Area, but they are 1.5, 1.5 and 1 hour away from Santa Clara, respectively.
It's not rocket science. It's important to be patient, learn the rules, and compare lots of numbers, but the hardest part is having the MONEY, and you've got that already. I'm an young engineer with a day job, the above I picked up over about a year and a half on the side.
The reason I'm posting this is to meet other people interested in this stuff. Drop me a message at istarist @gmail.com, if you are.