Trapped In High Barrier Areas

[Tad Fisher]

Hi Everyone,

I'm a new investor, living in Los Angeles, trying to make a first purchase while having a full-time job. My business partner (my brother who lives in San Francisco Bay Area) have saved up a solid amount of money and want to make a purchase where one of us will be local to help manage. Unfortunately we both live in such expensive, and possibly overheated, markets and are worried any purchase in either of these markets could be a terrible first investment! Should we change our thought process and look to make an out of state purchase where our capital goes farther but we won't be able to keep as close of an eye on it? 

Any advice would be much appreciated! 

Thanks!

Tad 

[Jay Hinrichs]

you dont have to go out of state if you don't want to.. there are plenty of moderately priced areas in CA. 

CA prime spots are a long term buy and hold play.. as we know the CA market is subject to some swings in values some can be dramatic.. but over time the state has shown some of the best performance in the entire US... but if your one who worries about value on a daily basis then RE can drive you nuts... if you have a long term investing horizon then you buy and hold and if and when we hit a trough you hold through the trough.. you only lose money when you sell at poor times.