I'm new to REI and would love to connect with others in the area. As a newbie, not sure if I should invest locally or out of state.
@Yonna Collier Welcome!...that's a question that comes up quite a bit and starting locally is the way to go especially if you can buy your primary using low money down options such as a house with ADU or a duplex which you can purchase with as little as 3.5% down using an FHA loan.
@Yonna Collier One thing that could help you overcome that "not sure if you should invest locally or out of state" feeling would be to compare San Diego to other towns across the nation with numbers. This way, the numbers decide for you!
Recommend investing locally first if you can. If your goal is to house hack and/or purchase something owner occupied I'd recommend taking advantage of an asset that is going to appreciate well overtime. Especially w/ your ability to leverage debt and come in w/ low money down w/ an owner occupied loan.
One train of thought is to diversify your RE portfolio just like anything else. So ask yourself, where is my money best used in which situations? Remember there are 4 portions of your return. CF, APR, tax savings, principal paydown. The SD market is prime for the long term, low money down owner occupied (at least initially) play. When you see the compounding gains you'll make on APR over time on a spreadsheet it tends to connect the dots.
In regards to CF, SD market has great CF over time but INITIAL CF is poor compared to other markets. However, rents are increasing between 3-4% a year here and the rental market is just as competitive right now as the purchase market. An increasing rental market will always follow an appreciating housing market. So, CF is actually quite good here when you really dig in.
Hope this helps,
Welcome to BP, @Yonna Collier ! Are you wanting to invest in residential or commercial property?
@Yonna Collier welcome to BP and congrats on starting your REI journey!
Thank you all for your feedback and insights! Much appreciated. I look forward to beginning my journey in REI and plan on staying local for now, focusing on 2-4 MF units. Also, we currently own our primary residence so not interested in house hacking...wish me lots of patience as I dig through tons of info on creative financing options....20-25% down on SD property is a bit daunting.