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Your Best Real Estate Investment
I am personally investing in
these brand new duplexes in Los Angeles. From 1986 through 2011 I
invested in Orange County properties that I could drive by and show off to
friends and family. They were good buys for the area; but in December of
2011, I discovered a better Southern California real estate investment.
I met a developer buying tear-down lots, and building brand new duplexes in Los
Angeles that provide a better return on investment. I purchased my third
one of these new duplexes in June of 2016 – and just purchased my fourth new LA
duplex in October, 2016. I feel these new duplexes are safer investments
than the stock market, and offer better cash on cash return. These
duplexes are like a very safe stock that pays attractive and steady annual
dividends. With a 25% down payment; we are currently averaging around 8%
cash on cash returns.
I just closed escrow on my
fourth duplex October 28, 2016. Our management company started my tenants
on November 15 at $5,400 per month. My next door neighbor purchased a duplex in
2015, and they receive $5,000 per month. The most recent duplex closings
for my clients in the second half of 2016 are renting quickly at $5,000 to
$5,200 per month. These brand new construction properties are averaging a
If you would like to have
real estate as part of your investment portfolio; I feel these new duplexes are
the best combination of positive cash flow; potential for appreciation; and
ease of ownership. The current availability is near the bottom of this
page – but changes quickly as the duplexes are selling before construction at
the current listed prices. The current prices for our new duplexes are $750,000 to $780,000.
I have attached Exterior and Interior Photos of the properties. Feel
free to call me at 800-944-2441 with any questions.
do believe it is important to hold real estate in our investment
portfolios. I have found these duplexes to be the best real estate
investment in Southern California – and I think in the long run; pretty much
better than anywhere else in the country because of LA’s potential for
appreciation. I also love the full service management; which means I have
none of the hassle of being a landlord and still enjoy 100% ownership, the full
profits and control.
is a link to the 2014 USC Lusk Center forecast for the Los Angeles rental
Obviously averaging 40 home
sales every year for the past 30 years, I come across a lot of good real estate
buys for myself. I just haven’t found anything else that compares to
these duplexes. That’s why I purchased four of these new duplexes for
myself. I have also helped secure another 35 of these duplexes for
my clients and friends. We closed another escrow for a family that
purchased last year and liked their returns so much that they wanted a second
duplex. We have also had duplex buyers from as far away as New Jersey
referred to us. They flew out and purchase two duplexes. We also
just had two other families each purchase their second duplex after purchasing
new duplexes a year ago.
Real estate is one of the
strongest hedges against inflation you can own. If you saved $1,000 in your
cookie jar in 1960 – it would only buy $200 worth of goods and services 40 year
later in 2000. Over this time, inflation eroded 80% of the value of those
dollars. During the same period, Los Angeles real estate matched and beat
inflation. A home in Southern California that sold for $17,000 in
1960 was worth $220,000 in 2000 – a 12 times increase. Plus the real
estate generated additional rental profit over that time period making it an
even better investment. (By the way; the home that sold for $17,000 in
1960 is worth $550,000 today).
The best hedges against
inflation are real estate and precious metals. Real estate gives you the
advantage of a monthly income in addition to rising in value with
inflation. You can’t rent precious metals. They are not going to
provide monthly income for your family.
You can purchase this
brand new duplex with around $190,000 cash and a 30 fixed rate loan - and
receive $580 positive cash flow each month. The loan balance is reduced
another $750 with each monthly payment. You can save, spend - or apply
the extra $580 cash each month to the loan balance and pay off your loan faster
if you like. The choice is always yours.
Combining the monthly cash
profit with the monthly principle pay-down, your total profit is $1,330 monthly
– or $15,960 each year return on your initial investment of $190,000.
That’s over 8% cash on cash return – Every year – without even considering
new duplexes are 2 to 4 miles south (about 5 to 10 minutes) of USC and Staples
Center. The builder personally owns over 300 of these units and has a
full service management company that fully manages the property for only $130 per month for each unit. The rents average $2,350 per unit - or $4,700
per duplex each month. As an owner, we don’t have to be involved with day
to day; month to month; or even year to year issues. I like that the
builder owns so many of these same units in the surrounding area that they have
a complete warehouse and full time crew to take care of any repairs that may
arise. Also, the duplexes they build and service all have the same
features; windows, heating, electrical, plumbing systems, fixtures, and
appliances. They buy replacements in bulk at a discounted cost and store
in their warehouse so any repair is very quick and affordable compared to any
other investment property an investor can own. This is like the Costco of
design is excellent and well thought out. The builder has improved the
model over the past 10 years of building
over 700 duplexes in the area – and has
perfected the floor plans. These units are 5 bedrooms and 3 baths, each
with a main floor bed/bath. These homes appeal to families that want long
term rental homes in this area. In fact, another great feature of these
properties is they average 96% occupancy
rate. This means fewer turnovers, less vacancy, and more net profit for
the owner every year.
construction amenities are outstanding. Of course everything is new and
built to the latest strict Los Angeles County codes. These homes all have
dual pane windows, ceiling fans, beautiful kitchen and bath fixtures and
cabinets including granite counter tops. The landscaping and exteriors
are very attractive. Each duplex includes a 2 or 3 car garage and ample
off street parking. Checkout the photos I have attached.
personally exchanged a Los Alamitos duplex I owned for 30 years and purchased
my first two of these duplexes. I closed escrow on December 30, 2011.
The cash flow is much better with these new duplexes, and I like the long
term outlook for property appreciation in this area. I am applying the
positive cash flow to the principal balance and paying my loans off in less
than 10 years. When paid off; each duplex will return over $3,000 per
month net profit. Of course the monthly profit will be higher if the
economy experiences inflation. That’s the beauty of having real estate in
your investment portfolio. Real estate is the investment that matches
inflation. These duplexes are like a cork on top of the ocean. If
the tide rises, the cork rises with it and stays on top.
I ever need money in the future, I can always sell a duplex – or even half a
duplex to a partner for the cash. Selling or holding in the future will
be 100% my decision because I own 100% of the property. It is real
property. Even in 10 years; these duplexes will still only be 10 years
old - which is very new compared to any other investment property I can
purchase that comes close to these numbers. I also love the full service
management; which means I have none of the hassle of owning rental property and
still enjoy 100% ownership profits and control.
are links to information about changes coming up in this area of Los Angeles.
are some financing examples:
25% Down 30 Year Fixed:
Pmt: $2,973 (30 year fixed 4.75% Int.)
monthly gross income: $5,000
positive cash flow: $390
(Plus $717 of
the loan payment is applied toward your loan balance raising your return on
investment to $1,107 per month – or $13,284 per year. This is a 6.8% cash
on cash annual return on your initial down payment and closing costs of
$195,000. And this is before adding potential appreciation - or your
depreciation write-off tax savings. These are estimates and your costs
and returns can be a little higher or lower. The new duplexes are averaging
$5,000 to $5,200 income per month. At $5,200 per month rent; you
annual cash on cash return is around 8% annually.
investors are purchasing all cash and enjoying a
$40,000 NET return on their
investment each year for their $760,000
purchase. This cash purchase provides an annual cash on cash return
of 5.25%. Cash investors recognize
owning this new duplex is better than the 1% return they are earning in the
bank, bonds, or US notes - and safer than a volatile stock market. This
consistent 5% ROI is before receiving the extra benefits of tax deductions and
potential rise in value with inflation.
With investment property in your retirement plan, you no longer
have to fear outliving your money.
wonderful thing about real estate is rental income tends to rise with inflation.
If inflation doubles - the duplex’s value and rental income can also double and
match inflation. Real estate is the hedge against inflation that we all
know and understand - in addition to its valuable function as shelter.
in the bank today will generate some interest; but as an asset it provides zero
appreciation. In fact inflation causes the value of your cash in the bank
to depreciate each year. Our duplexes offer the added benefit that
property tends to increase in value with inflation – the exact opposite of
depreciating cash. This improves the already great return on investment
of these duplexes even more.
Feel free to call me direct at: 1-800-944-2441 with any
if you would like to view these investment properties.
the best of success,
Re/Max College Park Realty