Judge My 2019 to 2022 real estate moves (First Timer)

Hello been lurking here since before 2019, used the knowledge and speculation from here and many websites to make decisions regarding investing and whether to go into real estate or stocks.

Anyway I can provide more background later but on to the subject judge my decisions related to my RE investments as first timer spanning year 2019 to 2022. At the moment this is humble bragging but maybe I made mistakes that I dont identify as a newbie. If it was stupid idea be brutal let me know how it will all come crashing down.
First I will provide the moves then the justifications after this post marinates for a bit

April 2019 - 1st Home Purchase COE
Location - East Contra Costa County
Price - $300,000
Int Rate - %3.25 30 years
Downpayment - 0
Closing Costs - 0
Other Costs - $15,000 improvements / rental preparation
Mortgage PITI - 1672
Rental Income - 2100

3 Bed/1Bath House
Less than 1000 sq ft
Front Porch
No garage LOL
Small Tiny Side yard, on big lot with easement
Neighborhood - THA HOOD shootings at the far end of the street every month, no impact on ownership since

Jan - May 2022 - 2nd Home Purchase COE
Location - Marin County
Price - $700,000
Int Rate - %2.875 30 years
Actual Closing costs - $0 (due to using proceeds from future sale to pay all downpayment and closing costs)
Downpayment - 70,000
Closing Costs - 12,000
Other Costs - Potential Minor Repairs of $5000
Mortgage PITI - 3500
Rental Income - Prospective Tenant at 3600 (Says I could have charged more)
Current Estimated Value - $850,000 (aprraised at $805,000 recent comps place at 850,000)
Equity - $220,000

2 Bed/1Bath House
Less than 1000 sq ft
Front Porch, Nice Rear Privacy Deck
Attached 1 Car Garage
2 Car Length Driveway
Small Tiny side yard
Neighborhood - Nice neighborhood new owners all around, not many rental, some day care homes nearby. Low end home values in the city

June 2022 - 1st Home Sale COE
Location - East Contra Costa County
Price - $450,000
Proceeds - Around $100,000
after taxes, commisions, closing costs
Proceeds used to pay myself back for costs of 2nd Marin County Home Purchase

My deal analysis results (whether true or not or unrealized)
1.Flip $150k equity to new house with current equity of $220,000
2.Home value from $300,000 to $850,000
3.Better interest rate %2.875
4.Move investment position out of volatile housing market to stable in demand market,unsafe neighborhood to safe neighborhood, better tenant pool, better schools
5.Marin house can serve dual purpose as investment or owner occupy, East CoCo House only for Investment
6.Easier to self manage rental at Marin House Compare to East CoCo House (Live in the Peninsula)

1.Cash flow decrease from around $500 to $100 (Unless what tenant said is true and can charge more)(Not true cashflow due to maintenance cost so may be negative)
2.Small downsize from 3 Bedroom to 2 Bedroom, However the 2 bedroom is only 52 sq ft less than the 3 bedroom and has a garage
3.Restart 30 year mortgage loan, delaying payoff
4.Forced to pay taxes on capital gains due to no 1031 exchange because I bought new house first, no time to wait due to interest rate rising. Loss of $30-40k (increase in equity $70,000 equity make up for it?)

So yea quick background I bought in 2019 expecting housing crash listening to youtube RE bubble boys and scanning RE Forums, but gut telling me get in the game at any cost so I bought rental in the hood. Expect to flip house after 5 to 7 years

Fast forward Dec 2021 after seeing record appreciation and writing on the wall slowing housing market, decide to reposition to stable area. Lost offer on house in san pablo because my son spilled milk (long story), new offer in Marin didnt want to go contingent on home sale in east CoCo House. Jan 4th rates jump crazy so I locked in purchase and closed.

Then sold East CoCo house, risky because East CoCo house was on market for 1 month, experience price decrease from 470k to 450k, took 1st offer and closed this month.

Risky because I bought the new house then sold the old house instead of the other way around. If I waited to sell then buy, interest rate is now over 6%. I go by my gut when I make moves, maybe Im stupid or maybe just like taking risk. Im done in RE next move is Roth IRA and 401k at the bottom of this cycle.

Did I miss anything in analyzing the pros and cons of the deal? Let me know if Im retarded haha

Sorry, if I missed it but really quickly why didn’t you 1031 exchange out of the East CoCo house into a same or bigger property (assuming can afford it) on the peninsula side? Defer or practically wipe out some of any capital gain by later moving into property. I did that with my Oakland 4plex awhile ago and it was the best move I ever made (well, maybe 2nd, I bought my 4/4 Sunset home off market for $100K under market and offmarket and now my cpa neighbor thinks it is worth 3M). I am now living in the exchange property after properly renting it out in compliance with 1031 rules (rental to rental) and as you know the peninsula blew up (granted, like most places). When I pay Uncle Sam his cut, at least it is a way bigger pie to work with.

Ok good question I barely glossed over it in the op, buttt

Yes I really wanted to 1031 exchange into a failed offer on an east bay house, after early January rising rates I was on time crunch and locked in my 2.875 rate. Next offer on Marin house would not entertain sale contingency and would not wait. So for me the buying window was closed but I could always sell later in my opinion IF the deal made sense to me, in my analysis above the numbers added up despite paying heavy taxes ughhh it hurts so bad though.

Had I started this process middle of last year I probably would have been able to sell then 1031 exchange into the new house, but as you see I couldnt even sell the house until June and it was on the market since March.

I love your strategy and is probably what I should have done if I had more foresight to pay attention to the markets which caught me off guard and forced me into early move in my timeline to reposition once I had some equity. Original timeline was 5-7 years, actual was 3 short years lol.

Also I was bullish on the East CoCo location due to recent infrastructure developements, and it was turning around until the pandemic hit and the city government regressed and just went insane like literally commiting crimes, multiple officials arrested by own police. Also homeless encampment due to open down the street this coming year :slight_smile:

Oakland to Sunset home is quite the upgrade very jealous. I love the northbay and hope to occupy the new house someday

Oh, actually Oakland to San Bruno… (even better turns out…) The Sunset home was my first primary home buy. The Oakland property was something I bought soon right out of college per the advice of my RE tycoon Big Bro…

Ahh I see, San Bruno nice accessible, I also was reccomended to invest in RE as most of my coworkers are small time landlords

Yeah, I grew up with landlording in my blood. My grandmother (RIP) was the brain trust who knew RE in San Francisco was a gold mine. Back then, they scrapped and scrapped to buy the apartment building that we all grew up in (one flat) and then rented out the rest. So, I knew about tenants from Day 1. Then, after graduating from college and working, my Big Bro taught me to go and buy RE to get some write-offs. The rest is history…

Thats really cool that your family passing on those skills to the next generation, I hope to do the same for my son by teaching him how to manage our rentals. Hope to finish an ADU in our primary and rent it out once in laws vacate and we have our 2 bed rental.

My parents were lucky enough to buy a house pre 2008 but mis managed by re financing 3 times to go on vacations and buy new cars lol. Will be unable to pass on the property to us and need to sell to retire :(. Didnt even bother telling me until I asked about it years later as an adult. Wont even tell me what mistakes they made with the house just overall lack of consideration for their 3 kids not willing to pass on any wealth or knowledge

Yeah, that sucks…

You can start building wealth with your generation and your kids will have something :slight_smile:

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Wow, that sucks!!! Unfortunately, I don’t have kids so honestly not sure what we are going to do with the assets. I guess my wife’s family in Malaysia/Singapore will get it all. That is why I need to retire and go enjoy myself in Asia!!!