Wholesaler · Santa Cruz, CA · Member since 2014 · 79 posts · 12 votes
I am believing that the CA market or at least No CA - Bay area has topped out... I have been considering selling my house for some time now and am in contract at over ask. I have been purchasing SFHs in Atlanta that are cash flowing..
I am curious to hear if others think I am crazy. I want to retire on the income from these rentals.
My partner and I - after 15 years actually want to live in one house. So, I have a place to land. Chime in or give me things to think about!!!
All of my properties are in Atlanta and I have a project starting off there, so, I'm packing all of my furniture and stuff into storage here, in California, and driving cross country on Friday, to Atlanta.
I figure I'll stay 6 months to a year and do a few more things, before I'll come back to Cali.
There you go! I don't think you are nuts at all. I own rentals in Atlanta too, I wouldn't buy there now as much but there are still deals there, and I think owning investments over a primary is excellent! It's my motto at least.
I used to live in Atlanta, don't want to move back, but I just rent here in LA while I buy elsewhere. Either way--moving there or staying here--works!
I really like Atlanta. It is beautiful, lots of green space, it is diverse - traffic sucks, but I guess if you have to commute to an office, life would suck no matter where you are. I love being my own boss. Have to keep my eye on the prize so I get to stay in this business.
Keep good thoughts for the two rehabs I have going on...
There you go! I don't think you are nuts at all. I own rentals in Atlanta too, I wouldn't buy there now as much but there are still deals there, and I think owning investments over a primary is excellent! It's my motto at least.
I used to live in Atlanta, don't want to move back, but I just rent here in LA while I buy elsewhere. Either way--moving there or staying here--works!
Ali, I agree with you. I don't like living in Atlanta either and prefer California. But I just found another little niche and find it worthwhile to do a few more deals in that niche and need to be present for that. But it's fun to be able to be flexible and go where the opportunities are.
Are the prices going up in Atlanta, over saturated with investors? Is that the primary reason you would not buy in Atlanta to much anymore? I am from San Jose California and I am looking for somewhere other than California to invest in.
I still am finding off market deals... they have to be vetted by legs on the ground you can trust as well as legitimate documentation; leases with contact info so you can reach out and talk to the tenants, someone to review the property for you that is competent with regard to understanding HVAC, Electrical, Roof and Foundation... All properties that are off market will need a little work or have tenants that are below market rents, but taking the first year to right the property and re-rent for as much as possible is my overall plan that I execute. You hear all about Texas as a place to invest, I just don't love Texas. Open to other places that others might offer up as not already saturated, but with jobs and people moving there...
I know of other markets with higher returns (if for no other reason...)
Saturation is definitely an issue, but in terms of how many rental properties are there now. It's made a big difference in my vacancy times during tenant turnovers. Not in a good way.
The appreciation boom already happened in Atlanta. The prices were sooo much lower and the returns sooo much higher in 2011-2012. Then nearly overnight towards the end of that year, the prices jumped about $20k and have only gone up since then. So the prices are topped out now, no appreciation (not much at least) left for now, and the returns have become much lower.
However, with that said, there is still cash flow there! Unlike other markets around the US, so it's not the worst place you can buy...
The hedge funds and investors demolished inventory there from about 2011-2014. Slim pickins' after that.
But like I said, if nothing else, there are just higher returns in other markets with less saturation.
I think that if you are planning to move from Santa Cruz to Atlanta in the very near future it could be ok, but would otherwise pass on selling. I agree that N. Cal might be at/near a peak, and so might Atlanta. Consider that it will likely cost you around 10% to sell (just transaction costs) and if/when the market in N. Cal hits a soft spot, it rarely dips more than 10% ... in most cases a soft RE market in N. Cal means that it goes flat (not up, not down) for awhile, but it rarely lasts that long. Beyond that, if you want to ramp up your investments, create some extra cash flow, and get more aggressive, you could cash out refinance your N. Cal house (no tax and much lower transaction cost, but higher risk and mortgage payments) and invest the money ... not my cup of tea personally, but it could work in your favor if you are sensible and careful about it and know what you are doing.