Buy & hold in California Central Valley

10 Replies

Hi All,

My son is looking for a positive cash flow houses with 20%  down payment in Central Valley area. He is  26 living in San Jose area as a software engineer. He wants to buy his first rental. We really appreciate to hear(experience) from those who have bought in Central Valley. What cities have better/stable rental demand?

Thanks Again

Has he thought about multi-family (2-4 units)?  I'm more familiar with the Southern California market, but I would imagine that getting a house to cash flow with 20% down is tough throughout the state.

"I would imagine that getting a house to cash flow with 20% down is tough throughout the state."

While I'm not in the central valley, in rural California, there are lots of cashflow opportunities.  I just sent in a high bid confirmation on a $153k 2/2 with additional unit over the garage, newer construction, that will rent for $2,300 or so.  Several hundred a month in cash-flow, and this is not one of my better deals.

You can easily find SFR's that cash flow using the BRRR strategy. It is not impossible to find properties that cash flow using traditional financing but it will be tougher. I invest in Sacramento because I live here and there are still deals to be found but if I were just looking for the strongest affordable market in the CV, I would look at Turlock/Merced/Atwater. Merced County has led the CV in job growth for the past 3 years. I have been scouting a bit in Atwater and Winton for a different business venture and was pleasantly surprised by the area. My impression is that it is better than investing in Stockton/Modesto/Fresno at the same price points.

Originally posted by @Joe B.:

You can easily find SFR's that cash flow using the BRRR strategy. It is not impossible to find properties that cash flow using traditional financing but it will be tougher. I invest in Sacramento because I live here and there are still deals to be found but if I were just looking for the strongest affordable market in the CV, I would look at Turlock/Merced/Atwater. Merced County has led the CV in job growth for the past 3 years. I have been scouting a bit in Atwater and Winton for a different business venture and was pleasantly surprised by the area. My impression is that it is better than investing in Stockton/Modesto/Fresno at the same price points.

Winton, Livingston Merced and Turlock are my current stomping grounds!  If you need drive by pics  let me know!

I also like Turlock for the State University and great downtown! There are a few rough areas (what town doesn't have them? lol) But it really is a great area! Good schools and friendly people! Lots of older homes, that can make great rentals!

Merced also has a new University, but housing is not close by. (Check out google maps to see the University). Merced went nuts with the last boom and there were many foreclosures.

Originally posted by @Agnes Jacquet :
Originally posted by @Joe B.:

You can easily find SFR's that cash flow using the BRRR strategy.

Joe, how do you monitor rehabs remotely?

 Skill, experience, and a foot on the ground. I still run my construction company remotely. It is construction (new builds) not rehab company.