Sacramento Multifamily

23 Replies

Hi all,

I am currently looking around the Sacramento area for a duplex or triplex to invest in. I am hoping to move into one of the units and potentially create some cash flow. I would really love some suggestions on different neighborhoods throughout the Sacramento area that would be better suited for multifamily investing or tips from anyone familiar with this area!

Thank you!

Taylor

Evening,

Unless you are looking for less than desirable home to live in you will want to focus your search on downtown, land park and the surrounding area.  You won't find a triplex that is good outside of that area.  You can find some duplexes in Fair Oaks, Carmichael to downtown and possibly Elk Grove but not many other areas I'd consider.  Don't expect a great return.  The home prices are fairly high so the returns aren't that good.

I have lived in the area for almost 40 years and have several homes here.

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@David Hutson   thank you for the advice. I have found a couple duplex properties in the areas you listed. 

The couple properties I have seen in good neighborhoods outside of downtown are between $335,000 and $350,000. With only putting 3% down, the total monthly expenses seem to range from $2,155 to $2220 depending on the interest rate. And the units rent for approx $1025 and $1075. Which those numbers already would create a negative cash flow. 

I am curious what advice anyone has on if these properties should be passed up or if I should just eat the negative cash flow for the time being until I can re finance or sell as the Sacramento area is rising.

If I were you i'd finance a condo to live in yourself, and go out of state and find properties that actually cash flow.  Finance those and make good returns.  The Nor Cal market's already sky high, you are getting in late in the appreciation game. 

@Taylor Comer  

Just because they are listed at a price does not mean that's the price you would pay as an investor. If it doesn't make sense and I would say negative cash flow does not make sense then you need to adjust your offer price to what you would be comfortable with as an end return. If you are only looking at MLS type avenues for deals there could be a whole lot of offers between you and your first property. Since MLS is open to most buyers your pool of competition will be very large and most likely someone will over pay for the property that is either not an investor or an investor that fudged the numbers to rationalize the "deal" to themselves.

@Taylor Comer  

that is the million dollar question :). If you can find a true wholesale deal that might be an option, or Driving for dollars, or direct mail campaign, or bandit signs, or, or ,or the list goes on and on. You ultimately will need to go after what will work best for you. For me it was lots of offers on MLS properties that got laughed at by the folks I was making the offers to until 1 that finally stuck. I think in the summer time though I might look into other avenues of deal flow as MLS right now for investors is like looking for a needle in haystack type investing for our area. It can be done but it might take you awhile.

@Chris Vail  That is sure what it feels like! Thank you for that advice, I'll have to look around at the other avenues to see what I can find.

@Jake Weir  I have found a couple properties that have 2 houses on one lot, but they are mostly in the Oak Park area, and specifically the parts of the Oak Park area that are still not getting better, if that makes sense!

You have gotten some good advice as to locations in which to look. Another option may be in the North Highlands area, which is a working class neighborhood. But, be very careful as there are good and bad areas within this concentric circle.

Best of luck in your pursuit!

@Taylor Comer  For what you want I'd look along the 80 corridor between Cal Expo to just before Roseville.  There are pockets around each exit on the freeway that may have what you are looking for.  Also along the fringe of Oak Park along 99 and Franklin/2nd Ave.  You may find a property that was converted to a triplex around there.  Just don't get more west than Franklin or more south than 2nd ave as that's where it gets really expensive.  On 2nd Ave north is where the rehad/transition is moving. That is where my fourplex is and I see properties in that area but haven't looked at them.  You may be able to get into something that hasn't gone up a crazy amount yet.

Norht Highlands has many pockets but I don't think you'll find the type of property you are looking for there.  No triplexes that I can think of and the only fourplexes are the McCuen style, which sounds different than what we talked about.

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@Taylor Comer  

I know the North area of Sacramento pretty well. Are you pre-approved or is this a cash sale? Either way, I may be able to help you find something. Properties go quickly. We often have deals that are off market also. Send me a pm

Talked with my realtor this weekend and she said - and I have some agreeance with her - that this year will see some "fence sitters" put property up for sale.  Everything feels pretty "normal" now in general.  With great interests now - I would expect to see a healthly RE season when it start to warm up.  Stay vigiliant and don't force a deal - you'll find one.

Don't count on appreciation to help lower your payment in the future. Mortgage rates are very low now. How can they get lower?  Have you looked into the Carmichael or citurs heights areas?   I can email properties in that area to show you what you can buy.

Hi everyone does anyone recommend a great realtor that works with investors and has investment properties some one that will help find a good cashflow deal.  Which areas should I be looking to invest in Sacramento ?

Originally posted by @Oscar Campos :

Hi everyone does anyone recommend a great realtor that works with investors and has investment properties some one that will help find a good cashflow deal.  Which areas should I be looking to invest in Sacramento ?

 Finding a good cash flow deal on paper isn't that hard, the hard part is funding a good cash flow deal in an ideal location. You aren't really going to find multifamily homes in A B neighborhoods so you are left with C through F. You can look in Carmichael, Citrus heights, Rancho cordova, South sac. 

Originally posted by @Oscar Campos :

@Derek Jones

I'm looking for single family homes in at least b neighborhoods I'm going to be  patient thanks for you info on neighborhoods to look in to thanks 

 If you're looking for b neighborhoods and sfr. Good luck. The housing market is hot right now and prices are up. You can try looking in Elk Grove, Roseville, Rocklin,Folsom but prices start around $350k.