How to make money in Southern California

Question

What do you think is the best way to invest in coastal Southern California?

The median home price is gonna be roughly $400,000, the 2% rule is a dream think more like the .2 to .5% rule here.

Do you buy small multi families for minimal appreciation and a chance to break even?

Do you try to focus on the city/county economic indicators?

Do you try commercial value add?

Compete with 1000s of flippers, and wholesalers?

What is the way to find a competitive advantage and bring something better or new to the table here?

Have at it guys.

Karen Margrave · Answer

@Parker Cox That is a loaded question as @Jo-Ann  Lapin mentioned.  The truth is, it depends on your specific financial situation and how much you have to invest.

When relocating to southern California we thought the market would be in doing fix/flip. However; there were so many offers on properties that they were going for over value. We decided to get in on new construction. Unfortunately, finding land that was priced anywhere close to where it needed to be to make a successful project was impossible, and it still is. However; we jumped in and are doing spec new construction. Our  first project was a breeze. The 2nd is the hardest in our 30 years of building.  Two others are so far going along like clockwork

There's Vacation Rental properties, condominiums, modular (as mentioned above), etc.

If you'd give a little more specifics on price range, etc. I could give you more ideas. You might want to get in on new construction, or another niche. In fact, I've looked at stuff down by Oceanside in the past.

Jo-Ann Lapin · Answer

What a loaded question!!. I think you need to think alternative. The market has the biggest Baby boomer population. They need single level housing. With land being at such a premium especially coastal. Maybe modular/ manufactured single level could be a feasible option. Never go against the market. Just an idea.

Dennis Kidd · Answer

Happy Sunday to all....

Question regarding open houses. My wife and I stopped by a open house in an area that we think might be decent for SFR investment. We plan to buy fix and hold. What questions do we ask the agent, and what are we looking for when touring the property to determine if it's a good deal?

Thanks in advance

Dennis Kidd · Answer

Thanks all for the great info. I'm in the process of learning and building a plan.

I agree that there has to be a way to get started in this high priced So Cal market.

All of these podcast with people talking about $40-$50,000 properties, I just shake my head. Ya right !!!!!

Does anyone ever get interviewed from this area with ideas and success stories?

Brian Gibbons · Answer

I write on seller financing, and the best Cali Seller Financing RMLO is

http://sellerfinanceconsultants.com/seller-finance...

From their site..

Seller Finance Services and MLOYour mortgage loan officer can be a vital part in providing seller finance services when selling your home with out a Realtor.  By now you know about the necessity to use a Licensed Mortgage Loan Originator, (MLO) in your transactions involving Seller Financing. And at the same time, we are now proud to announce that we are providing Nationwide Seller Financing processing services which means that a licensed MLO in your state can work with us and thus have access to our forms in your transactions in every state to maximize Dodd-Frank compliance and salability of the note that is created.As well, as our approved MLO list is being built, we are offering to approve up to 10 MLO

Jimmy Syamphone · Answer

SDCIA is a great resource for investors in San Diego. I have been to a handful of their meetings when I am down there and I have made some good connections. It is a good place to network with all types of professionals in the real estate industry. Highly recommend it.

Garrick Oconnell · Answer

It all depends on you!

I can tell you I have met flippers, wholesalers, and developers at SDCIA and NSDREI that are doing deals and finding success.

Subject to seller financing is a great niche, if you feel comfortable follow it and become and expert then DO IT. Check out some real estate investing meetings and talk to other investors. SDCIA has a huge library where you can rent books as a member well worth it!

Parker Cox · Answer

Thanks to everyone for all the responses, and its not so much a tale of complaining, but more genuine curiosity about what others feel works in our market.

Recently, I came across the idea of subject-to and seller financing, which I thought was a very interesting prospect in the high priced areas like San Diego.  Any thoughts?

Jim Keller · Answer

Parker

I work in the Inland Empire the medium home price is $345,000 I have done many of them this year.  Vurtually all of my deals have been under this price.  We also have a condo going in Anaheim, Ca. we purchased for $250,000  this is a flip for us as well.  We found an lease purchase in Anaheim too, this has been a great deal for us, only $10,000 cash for the option and we only pay a lease payment as I fix the home so I can sell it for more.

You can do it..... we all have to start somewhere.

Jim

How to make money in Southern California

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