Saturday, November 4, 2017

Perfect Owner User / 1031 Exchange on Iconic Balboa Island

Three units for sale on the best retail street in Balboa Island. One residential unit over two retail stores. Both stores are leased with >$6,000 monthly income. The 2 bedroom residential unit has just be completely renovated to a very high standard. This would be an ideal investment property with personal use benefits.

Mixed use properties are more difficult to finance, but that may be an opportunity for a cash rich buyer or someone who can find alternative ways to finance.

Listed at $2,350,000. Call me for details.

Thursday, October 26, 2017

Rental Property Investments Orange County, CA

Let's talk about the investment opportunities available to you within a 1 hour Southwest flight south. Most of Silicon Valley and the Bay Area has become very expensive to buy investment properties.  Good alternatives can be found surrounding one of the best growth cities in SoCal: Irvine. 

Why Irvine?  This city is master planned and very pro-business. It is building many new office parks and buildings to attract great companies. This would be a perfect place to buy a rental property but not possible in the multi-family arena. The city did not build 4plexes or small apartment buildings. If so, they are owned by The Irvine Company - essentially the developer of all of Irvine since the 1950s.

There are very good opportunities for duplex, fourplex and small apartment building purchases in surrounding cities such as Santa Ana, Anaheim, Costa Mesa, Huntington Beach, Garden Grove and Westminster. Vacancies are low, rents are strong and new apartment growth is limited. These class B & C buildings are in excellent locations, stable and can be upgraded to increase rents. Quality property management is also readily available. I am sure you will find the rates of return better than Bay Area options.

Aside from straight rental investment options, consider the benefits of a rental property in a top beach location. There are small rental investment properties in great beach towns such as Huntington Beach, Newport Beach, Laguna Beach, San Clemente and others in Orange County. A purchase of a fourplex can be a great investment plus you can allocate one unit for family (or AirBnB) use.

Let's have a conversation about your goals. I am sure there are some good options here for you.

Tuesday, July 25, 2017

Dana Point Duplex for Sale and a Family Planning Guide

This duplex in Dana Point could be the ideal 1031 exchange or straight purchase for long term use.
($995,000 price, great area and condition, 2,198 square feet)
I am a big advocate of future planning. Many homeowners buy their first house, sell it and trade up when the kids arrive and then eventually face retirement in a large empty house. What is the next step? Sell the home and look for a nice condo near the beach? While all that is achievable, it does add stress, coordination and tax implications to the mix when you may not want them.
My simple plan:
Once you own your first starter home, and before the family starts growing, buy a rental property somewhere. It doesn't need to be in Dana Point or some other luxury location. It just needs to be a deal that will increase in value and cash-flow over time. As a current Orange County resident, I would look at small SFRs in Santa Ana, Long Beach, Westminster, Garden Grove. There are many other places to consider - I happen to like the growth patterns there.
Keep the house rented and in good shape for 10+ years. Sell eventually when the market is hot in that segment and 1031 trade into a 2 unit (in this case in Dana Point) where the market is less hot.
Now keep that property for another 10+ years until the kids go off to college, finish college and can support themselves. Be careful not to downsize too soon - some kids come back!  You probably have traded up the small starter home and bought a larger home in that same time frame. Assuming it is in a good neighborhood, rent it out. Move to the duplex in Dana Point.
If you have a nice house in a good neighborhood with low property taxes, you stand to get good, stable rental income and are advantaged by Prop 13 taxes and you get tax depreciation. All with no sales costs to eat into your equity.
Your duplex in Dana Point is also Prop 13 tax advantaged, sitting in a nice location where your family will want to come visit and again no new purchase hurdles and costs.
Finally, your large rental house is a great asset to keep up with rising living costs. Rents should increase every year and you continue to build equity. If values are going up 3-5% per year and your house if worth $800k - that is $24,000 - $40,000 of equity growth that you earn in your sleep.
Plan for the margaritas by the beach in your 60s now before it gets there too soon!
- Mario, almost 50...

Wednesday, March 22, 2017

Orange County Apartment Investments for Sale

The small apartment market in Orange County, CA is hot! There are not many listings and most are in escrow. That being said, I keep a short (and ever-changing list) of attractive deals.

4 units Lake Forest, CA: large, owner-occupied quality four units with ideal amenities: garages, large unit mix, quality design, clean street, great OC location

3 units Huntington Beach - townhouse style side by side units with garages walking distance to the pier and downtown

4 units Huntington Beach - super large 4 units of 8,000 square feet! Great water side location. High quality architecture, custom built - ideal for owner-user.

For an updated list of investment properties, connect with me anytime!

Tuesday, December 15, 2015

Loans for Investment Properties

There are many restrictions to financing a rental property - including the following:

Having more than 4 mortgages or more than 10 mortgages
Cash out over 4 mortgages
Cash out over 10 mortgages has a different level of restrictions
Purchasing an investment home over 4 mortgages affects amount of down payment
Loans over the conforming rate limit $417,000 or $625,500 in certain areas of California
Residential / commercial mixed use properties
Properties with 5+ residential units
Rental condos in buildings with a high renter ratio
Down payments fluctuate depending on all of the above scenarios.
FICO levels affect all of the above in cost and rate.

For help understanding the best financing available for your currnet home or investement proprty, please give me a call.

Mario Pinedo
Banc of California
Cell 415-269-6249
Office 949-381-2901
NMLS 1029116

Tuesday, January 20, 2015

Coming Soon: Cupertino Office Condo For Sale

We are putting a commercial office condo on the market this week in Cupertino. Approximate details: 1,700 square feet, 10 years old, two story unit with interior staircase, Monta Vista area of Cupertino. Offered at $735,000.  For more details please call me direct at 415-269-6249.

Monday, January 12, 2015

Expensive Apartment Investment Market in West Valley

It's amazing how expensive the apartment investment market has become in West Santa Clara County. As of today on the MLS, between Los Gatos, West San Jose, Campbell, Saratoga, Cupertino, Santa Clara and Mountain View, there are only two available four unit buildings for sale. One is in premier down town Los Gatos - but priced at approximately $891 per foot (that's rich) and the other is on Temple near Almaden Expressway and Blossom Hill - a fourplex listed for $1,250,000 (that's rich too). There are 10 buildings in escrow in those same areas from 3 units to 22. So basically, whatever hits the market generates an acceptable offer quickly.

It's definitely a good time to sell to maximize value!

Now we should talk about where to buy an apartment building investment property. I have a few suggestions.

There are other parts of California to consider (LA County, Orange County, San Diego County) that have high occupancy rates, good economics and increasing rental rates at far lower costs to acquire. Example: for $799000 you can easily acquire a four unit building in Orange County, Consider 3,100 square feet on a 9,500 sq lot with $57,600 in current rents.

Remember Southwest Airlines costs $72 per leg if you book in advance! Let me know if you want to review some real time examples.

Tuesday, September 23, 2014

7 Unit Walk to Beach Apartment Building for Sale in Santa Monica

I just reviewed a wonderful 7 unit fully occupied apartment building, walking distance to the beach in Santa Monica. This is an excellent property for a long-term hold. Existing rent control in Santa Monica means that when tenants do vacate, old rents will go up to market rents. In some cases this is over $1,000 per unit. The location and the quality of the building also makes for a perfect building to keep  one unit for personal use. Flights on Southwest Airlines are $120 round trip if your book early! The building is offered at $2,500,000 and will require a very hefty down payment of $1,500,000 due to the low existing rents. But, to be able to buy a building in that location at $357,000 per unit and $402 per foot is rare. This is an excellent opportunity for a patient investor.

Friday, September 12, 2014

Adjustable Rate Mortgage ARM vs. 30 Year Fixed Rate Loan?

"Always get a 30 year fixed rate loan!" or "Don't pay the higher interest rate on a loan that you will refinance later" or "You will sell that home when you need more space so why get a 30 year loan" - Have any of these advices been offered to you when considering which loan term to choose?

Those three suggestions are wise and unwise depending on your situation now and what you plan to do in the future. Can you predict the future? The answer is no and yet,  you can give probabilities to the future to help your decision.

First some facts:  The average home in the US is owned for approx 7-10 years. The average condo is owned for less than that. So - that may rule out the 30 year fixed rate loan immediately, A 30 year fixed rate loan today may have a 4.5% interest. A 7 year fixed rate loan today would be around 4%. So, if you are keeping the home for a shorter period of time, why pay approximately $500 extra per year for each $100,000 that you borrow? (I am sure somebody reading this is thinking what is $500 over 1 year - that is worth the comfort of a fully fixed rate loan)

Most shorter term fixed rate loans today are fixed for 3, 5, 7 or 10 years, amortized over 30 years and typically become annual adjustable rate loans after the fixed rate period.  There are different structures with other ARMs (adjustable rate mortgages) but this structure is very common.  The comfort of knowing exactly what your payment will be is either 3, 5, 7, 10 or 30 years depending on which fixed term you choose. The amount of interest rate that you pay rises typically from the shortest term to the longest term. It would be safe to say that you can get a mid 2% rate in the 3 year range and a 4.5% rate in the 30 year range. That difference may be significant depending on  your current and future plans for the property.

Let's say you are buying a small starter home with plans to want a larger home in 3 years. If you plan to sell the home in 3 years, then a 3 or 5 year fixed rate loan may be perfect. But... what if you decide to buy a larger home in a few years as planned and keep this first home as a rental property? Now, you have a loan which will start adjusting every year (or monthly) which fluctuates your cash flow.Future hindsight may tell you that a 7 or 10 year fixed rate would be better. It's sad that we cannot rely on future hindsight now!

Now take my mom as an example (sorry Mom!). She is retiring in the next few years. A 30 year fixed rate loan may be the best choice for her. Refinancing or dealing with an adjustable rate payment when going into retirement (fixed income) is not ideal. Solid, secure financing makes sense then.

Where are you in this spectrum of home ownership? Let's talk and flush out the best plan for you. Mario cell: 415-269-6249 call or text

Or see my site:  www.HomeLoans.LA

Friday, July 11, 2014

Duplex Fourplex Apartment Building Statistics in Santa Clara County

At this week's Bay Area Apartment Broker's Forum meeting in San Jose, guest speaker Tom Scott of Cambridge Management Company brought some interesting statistics from the Santa Clara County Recorder's office.

2-4 Unit Properties:  15,144 total properties - 787 sold in 2013 - 5.2% of the inventory sold - 19 year average hold

5+ Unit Properties: 5,719 total properties - 554 sold in 2013 - 9.0% of the inventory sold - 11 year average hold

There is almost a double hold period for duplexes and fourplexes compared to larger apartment buildings.This could mean that the ease of ownership on a smaller building is greater and therefore those owners hold the properties longer. Or, someone with a 5+ unit property makes more money faster and therefore sells in a faster time frame. Those are my two suggested reasons.

What do you think?

Owner Occupied Duplexes for Sale in Silicon Valley

Today there are 25 duplexes for sale in Santa Clara County that are listed under the maximum loan amount for FHA financing. What does this mean?

For 3.5% down payment, you can buy a duplex in Silicon Valley, live in one unit and rent out the other unit. This provides you with maximum financing ability, a tenant who will pay you rent to offset the mortgage and tax depreciation on the rental unit to offset taxes. This is a great way to start your investment portfolio. Call me for details - Mario Pinedo, CCIM 415-269-6249

Monday, June 23, 2014

Two Large Lot Mid-Century Aparment Investments in Orange County for Sale

Probate sale of two nearby multi-family properties - all bungalow style duplexes on large lots in Orange, CA. These are well located fully occupied investment properties available for sale via an approved probate process. The large lots, single story, duplex/bungalow units generate longer term tenancies due to more personal space and no up/down tenants. Perfect properties to have private patios & yards. Excellent parking too. Outstanding 1031 exchange replacement properties. For more info on these rare apartment properties, call Mario Pinedo on his cell 415-269-6249.

Monday, June 16, 2014

3 Multi-Family Rental Investment Units for Sale in Grass Valley, CA

There is a very nice rental property investment in Grass Valley, CA for sale. On one lot is a single family home + a duplex building behind. Three stabilized rental units for $357,950.  Excellent 1031 exchange replacement property. Professionally managed currently and can be continued. Beautiful foothills town of Grass Valley is a retirement destination for many San Francisco Bay Area residents. For more info, please call 415-269-6249.

Monday, June 2, 2014

Nice 4plex for Sale in San Jose!

4,088 square feet on an excellent street in San Jose's Cambrian area for $1,279,000 just hit the market.  Very nice quality property and size for the $$$. For more deals that I like in Silicon Valley, The Bay Area or abroad - give me a call 415-269-6249.

Monday, May 26, 2014

Apartment Investments Orange County Southern California

I have recently been comparing apartment investment opportunities in the San Francisco Bay Area to Southern California. The Bay Area (and especially Silicon Valley, The Peninsula and San Francisco) is offering very low rates of return. Also decent investment properties are hard to come by with lots of buyers chasing deals.
These same dynamics are also happening in west Los Angeles. This area is in huge demand causing cap rates to be very compressed.
Alternatives to these areas are southern LA county and most parts of Orange County.
Solid, stable apartment buildings can be purchased in the low $200 per foot range. Fourplexes routinely can be found in the $700,000 price range for 3,500 square foot buildings in decent areas.
There are also great coastal locations with apartment buildings perfectly suited for 1031 exchanges. These premier locations can provide great rental rates and occupancy with potential owner-user unit allocations.

Friday, March 14, 2014

Financing Available for Rental House Portfolios

We have access to a strong lender offering one loan portfolio financing for single family, condo, townhouse, duplex and fourplex rental portfolios. Many investors who have purchased 5, 10, 20+ rental houses are experiencing problems getting additional financing for their next deal. Fannie Mae and others have put maximum loan restrictions above 10 financed properties or sometimes less. By aggregating your rental property portfolio into a LLC and financing the whole package with one loan provides an exciting solution,  Minimum aggregate loan amounts of only $1M. This is 4 houses or less in California. This lending platform is available throughout the 50 states. Call me for details 415-269-6249

Wednesday, January 15, 2014

Bank Owned Commercial REO Retail & Office Center Orange County for Sale

Taking offers in February 2014 is a well occupied, very nicely constructed mixed office and retail center in southern Orange County, CA.  It is a bank owned asset with remarkably good condition and net income.  Approximately 67,000 square feet situated amongst 7 buildings on a 5 acre parcel of land. There are a variety of office and retail suites to accommodate various users. The asset is being offered un-priced. Market valuation should put this asset in the $10-15M range. Call for more details.

Friday, November 15, 2013

All Cash Investor Buyers Can Finance After Close of Escrow

Many investors or home buyers are paying all cash to buy a condo, house or multi-unit property in order to win multiple offer situations, foreclosures or short sales. Placing a loan on the property after close of escrow may be a good way to recoup funds for use elsewhere. If a loan to pull money out of the property is done within 6 month of acquisition, then standard refinance rules apply. This method avoids the more costly cash-out loans.  Let's talk about this strategy in detail before your time frame is up.

Thursday, October 24, 2013

Single Tenant NNN for Sale

Just listed is a Single Tenant NNN property with McDonald's as a corporate tenant.
Cap rate is 4.75% - which is not wonderful. Upside is a 10% bump in rents in 12 months.
Future increases are 10% increases in rent every 5 years of base lease and option periods.
Ground lease - with no landlord responsibilities. This pad is part of a larger grocery anchored shopping center.
Price is $1,726,000 with a original lease expiration in 13 years. A big upside is a strong residential location in Miami, Florida.
There are some back woods locations for single tenant NNN deals - this is not one of those. Good 1031 exchange vehicle.
Have you considered selling your equity rich residential investment property? Let's run the numbers.

Wednesday, October 23, 2013

Sacramento NNN Strip Center for Sale with Starbucks Anchor

Just hit the market is a two tenant NNN Strip Center for sale in Sacramento with 10 year leases and great tenants.
6% cap rate, $2,662,408 price, Starbucks & Z Pizza leases for both tenants terminate in Aug 2023 and Dec 2024 plus options beyond that. At this price, you can achieve positive leverage if you add financing. Demographics are strong with $87,000+ average household income within 1 mile radius.