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2/2 Condo with wood floors and private patio – $1500/mo

December 8, 2010

Rebekah Owen, REO PRO! | Benchmark Properties | (650) 492-5958
277 Tradewinds Drive #7, San Jose, CA
Clean 2 bed 2 bath condo with large patio overlooking greenbelt
2BR/2BA Condo
$1,500/month
Bedrooms 2
Bathrooms 2 full, 0 partial
Sq Footage 992
Parking 1 dedicated
Pet Policy Conditional
Deposit $2,000

DESCRIPTION

Open design with living room dining room combo. Nicely maintained landscaping. Sports Center with Tennis Court, Indoor Pool, and Gym. You have onsite parking and easy access to shopping, restaurants and freeways.
see additional photos below
RENTAL FEATURES

– Central heat – Hardwood floor – Family room
– Breakfast nook – Dishwasher – Refrigerator
– Stove/Oven – Balcony, Deck, or Patio

COMMUNITY FEATURES

– Covered parking – Guest parking – Clubhouse
– Laundry on-site – Fitness center – Swimming pool(s)
– Tennis court(s)


LEASE TERMS

12 month lease locks in this low rental rate.
ADDITIONAL PHOTOS


Front

Cute Kitchen

Wood Floors

Large Living Room w Patio

Sparkly Clean

Fitness Clu, Tennis, Pool
Contact info:
Rebekah Owen, REO PRO!
Benchmark Properties
CA 00994952 TX 0555675
(650) 492-5958

powered by postlets Equal Opportunity Housing

Posted: Dec 8, 2010, 11:52am PST

How Do You Know When It’s Time to Dowsize Mom’s House

December 4, 2010

At lunch yesterday, we were discussing our parents – the good, the bad, the ugly.  Some are good with money, others not.  Some are in great health, others not. Some are fine taking care of themselves, others not.

This entire discussion began after learning that my friends mother had passed. This mother was managed well by her husband but, when he passed a few years ago, her demons were let loose. She had periods of paranoia, she gave away valuables, she disappeared.  She was manipulated by the bad brother, she was taken advantage of,  she was diagnosed with Alzheimer’s.

The family knew that mother’s memory was sporatic but no one knew how to broach the subject. The mother was feeling afraid and unsure but she covered it with false bravado. The family was concerned for mother’s safety but didn’t feel that it was their place to say anything. After all, she was the mother.

The tricky thing with Alzheimer’s is that the longer you leave the elephant in the living room, the harder it is to talk about it. Erratic behavior becomes the norm and the patient is less able to coherently discuss the issue.

In the beginning there are many “opportunities” to “notice” that something is off and to discuss it. I don’t recommend asking a question like “did you just run the car into the garage wall?’ The standard reaction to this would be one of defense and then a constructive conversation is lost.

Instead, try something like “mom, that’s the third time you’ve bumped into something with the car this week. I’m worried that the next time could be really serious” ‘It might be time to find other ways to get your errands done”

My grandmother was super stubborn and super independent. She refused to move close to the family and she refused to give up the car. When she passed I finally got a close up look at her car. It had scrape marks about two feet from the ground and all the way around the car. She had rubbed and bumped and smooshed every panel of that car. Today I am just grateful that she didn’t take herself and someone else out with her.

When it came time for my granddaddy, the second time he ended up in a ditch and had to get the car towed, my dad took his keys.

Each person’s parents age in different ways and each person handles it differently. Just remember, when your folks start reminding you more of your kids than of responsible adults, it may be time to start thinking about downsizing!
So, how do

The 5 Cs of Credit

November 27, 2010

When I started in real estate in 1988 it was illegal to have a numeric score associated with your credit report. We learned to get a general impression of the company, their leadership and their spending habits by reviewing their trade lines. How they used credit and the consistency of their re-payment. From this we generated a hypothesis of the risk associated with the borrower and made a credit decision.

Since then it has become uncommon to even know what a tradeline is. Today the client is just a number and no amount of cajoling can change that – especially since the underwriter is a twenty something kid just out of college and doesn’t hardly know what a tradeline is!! In college we learned about the 5 Cs of credit. To me they are a much more reliable way to gauge risk than a credit company’s logarithmic formula. Maybe that’s just because I can see the logic behind the 5 Cs while the credit companies won’t divulge their numeric reasoning.

So, here are the 5 Cs:

1) Character – also known as integrity. Does the person do what they say they will.

2) Capacity – the ability to repay. Often based on past evidence and/or a current paystub.

3) Capital – also know as a down payment. Folks are less likely to default if they have skin in the game.

4) Collateral – something of value that the lender can sell if the borrower fails. “The House”

5) Conditions – current market

When I analyze and investment, tenant or overall transaction based on the above, I get a very clear view of the borrower’s current position and I have pretty good instincts into how their behavior will follow. It works for me. And I hope it can be a tool in your analysis tool box.

What does an A rating mean anymore?

November 22, 2010

This morning I was reviewing a NNN leased investment in Memphis Tennesee. My folks are considering trading their apartmetn building for this type of investment because they still get monthly rental income but they don’t get all the maintenance and personality issues that they do with apartments.

On the flip side, my clients would be trading their 32 renters for 1 corporate tenant.  If the market should shift or if the company got sued, the entire burden of the lease and underlying mortgage payments could shift back onto my clients. The underlying lease is secured by the company and the company is an “A” rated company but, after the CMBS drama with AAA rated bonds, it got me wondering if I can really rely upon this “A” rating.

During the credit melt down starting in 2007, AAA rated mortgage backed securities were quickly devalued to junk bond status resulting in the the $638 Billion dollar bankruptcy by Lehman Brothers and a snowballing bank default that continues. As recently as Friday the 19th 3 banks failed.

In retrospect, the bankers trusted the AAA rated securities but all the AA rating means is that their history is good. Historically there has not been a default. According to Wikipedia, a AAA rated muni bond has historically had a 0% default rate and we used this as gospel. Unfortunately, this rating can not predict the future and, unfortunately again, there is no guarantee.

That’s the thing about investments, the higher the return, the higher the risk.

We Learned How To Win The Game As Kids

November 17, 2010

My friends daughter was sitting on the sofa, bored. Her boyfriend was at school and there was no one to play Wii with her. Please! she bleated with a big sad-eyed look. The other day they were all playing a baseball game and it had seemed like fun so, I gave in and sat down.

 

“What are we playing?” I ask as she hands me a controller.

“Monopoly”

 

It’s been a hundred years since I  played Monopoly. I remember it as a board game with yellow and blue money. It seemed to take forever and I was fairly good at it. Mariah kicked up the game and chose “Jungle” monopoly theme. The game is the same, roll the dice, buy properties, improve them and charge crazy rent on them. The goal is to create a Monopoly so when folks are in your side of town then have to stay with you and you can charge them rent.

Mariah knew that she wanted to own property, that she wanted to improve them and that she wanted to collect rent. She took every opportunity to do that and ultimately she won.

Now, Isn’t that what I do at work?

1) I want to own property.

2) I want to improve my properties.

3) I want to collect rent.

As long as I collect rent every month, I make more money than I spend and I “win”.

 

Evey once in a while I go to jail for a while but even then, my properties are still out there making me money.

 

Seems pretty simple, doesn’t it?

Your tenants are my clients, too!

November 16, 2010
I’ve been doing property management for 20 something years. I first started out with my own properties and slowly added a client here and there – mostly by referral. My degrees are in finance and I can crunch a number with the best of them but I don’t think that’s the skill that’s needed when managing a property. Sure, I want the work done and at a reasonable price but if there is one key I guess it would be to treat everyone like people. Isn’t it the key to life anyway?
Got this email this morning:
Rebekah,
You have the nicest people working for you.  I am sure it has to do with your wonderful, giving personality.  I have enjoyed everyone who has come to my door.  Thank you sooo much for taking care of my door, windows and heat.  The door is amazing!  I almost fell in the first time it opened so easily and locking it is a joy!  It has turned cold but I don’t feel the cold like I did through the windows.  I haven’t turned on the heat yet but I’ve been warm and I know they did extensive work on the roof etc.  Anyway, I so appreciate you for helping me out and I am a happy tenant!!  Have fun and Keep Laughing!  Dyan
Which I immediately passed on to my handyman. He’s a great guy and when I tell him how happy my tenants are he just beams 🙂
I’ve had my share of flaky repair guys – like the one that almost burnt down an apartment building when he was careless with an acetelyn torch! Or the guy that didn’t tighten the shower knobs so when my tenant got in the shower and touched the knobs they fell off!!! Nothing worse than being naked, covered in soap and holding the faucet knob in your hand!!
Kinda funny now 🙂
Had a guy ask me the other day why he shouldn’t hire a young stud to manage his properties. My standard answer is “I’ve already made all the mistakes he hasn’t a clue about!!”

I sound like one of those crusty old realtors in the polyester suit and raccoon eyed makeup;”Young man, the year you started pre-school I sold my first apartment building.”

San Jose Investor Deals!

November 15, 2010

I am a real estate broker. I don’t work for the government or google or the teacher’s union. I won’t be getting a pension check or a gold watch after 30 years of service.

I was on track to leverage my investments into a nice $6K/mo income by the time I was 50, when the real estate market dumped.  It’s since been 3 years of crappy income but my investments have held on pretty strong. (I had to drop some of  the rents when market rents dropped but I got into the properties smart and the lowered rents still cover the mortgage.) And I think it’s a great time for a few more!

Before the dump we were buying in Dallas.  It just made financial sense especially with the craziness in the California market. Instead of buying one $750K house here (or 1 fourplex with $500K equity and no cash flow) with $2500 income per month ,  we were buying TEN $75K houses with $1100/mo PER HOUSE income for  $11,000/mo Gross Income.

Those deals are still available, and we are doing them every month, but I am starting to see deals here, in San Jose, again.

This last week I saw two investments that I like – a lot – and I’m gonna share one with you today:

Tradewinds Drive

This is a working class neighborhood with lots of rentals and there is lots of competition but let me tell you what I like.

Right now you can buy a 2 bed 2 bath 992sf condo for about $185K (These were going for $450K about 36 months ago). Since I am an investor, I need to put 30% down =$55,500 with $129,500 remaining loan @4.5% = 656.16/mo PI. Tax and HOA bring this to $193 + $345 = $538 for a grand total of 1194/mo. (Blah Blah Blah, I am not selling you loans, go shop APRs and all that financial disclosure stuff. This is JUST rough number crunching)

Today these same condos are renting for $1450-$1650/mo so lets take $1550 as an average so you’ll get $356/mo POSITIVE CASH FLOW or $7.7% return on your down payment IF THE PROPERTY VALUE STAYS EVEN.

We all know it’s gonna creep back up and as it does your renter pays your payment, you have a bit of cushion for repairs and such and in 30 years if you do NOTHING and the market stays even you’ll have $1550/mo income to live on.

I like Tradewinds because it’s a bit nicer than the neighborhood, has a pool and fitness club and the HOA takes nice care of the maintenance, upkeep and insurance for you.

Yes, you have to “deal with” tenants but if that’s a big deal, someone that does proeprty management – like I do – can manage your tenants for around $110/month and you still make $248 EVERY MONTH for as long as you own the property.

BTW, there is the tax write off and there will be interior wear, tear and updating that you can use the $356 to cover.

In the meantime you keep making your $150K/year or $72/hour and you never even have to talk to a tenant.

BTW, there is the tax depreciation and interest write off and there will be out of pocket for interior wear, tear and updating. You can use the $356/mp to offset this expense.

My goal is to get 3 of these. That’s about $12K/year for now and $4650/mo in 30 years.  But 30 years just seems to darn long!

Since I need to retire before I am 77 I’ll probably take the $356 and pay down the mortgage each month for a free and clear property in 14.58 years or 175 payments . I’ll be 62! Perfect!

I really do love real estate. There is a ton of money to be made, all the tax incentive to do it and the property will always be there. It doesn’t even matter what the market does because your tenants are BUYING THE HOUSE FOR YOU!

If you feel guilty about all the money you are making you can take a nice leisurely drive by your property on Sunday afternoon and act like you deserve the income.