Hi I’m a newbie in real estate investing . I am trying to purchase a sfh or apartment ! I stay in California and I don’t mind commuting back and forth as long as it’s not too far . I was wondering what are the best areas to invest in for rental homes ? AZ? NV? Anywhere in California ?? Thank you.
Hi I’m a newbie in real estate investing . I am trying to purchase a sfh or apartment ! I stay in California and I don’t mind commuting back and forth as long as it’s not too far . I was wondering what are the best areas to invest in for rental homes ? AZ? NV? Anywhere in California ?? Thank you.
It’s always best to stick with the area you know the best. If you are priced out of the market it may not make sense to invest out of state for smaller properties so you should look at going big if you can.
@Brian Nguyen, as mentioned there is a lot of info that is missing to give any meaningful feedback.
But successful real estate investing comes from having an intimate knowledge of the area you are investing. Out of state can be done, but you are relying on other people a lot more, particularly contractors and property managers, who as a whole are not known to be the most reputable of professions. If you find some good ones, great.
Alternatively, looking at passive investments or syndications could be an option to get into real estate, out of state, but with a professional company that will handle the work of managing the assets and the managers.
@Greg Dickerson how did you guys gain all the knowledge you needed to start feeling confident investing in real estate ? Did you guys take classes ? Courses ? Bigger Pockets ?
A. My goal is to retire early . I want to eventually purchase rental homes specifically for cash flow !
B. I have $100k cash .
C. Ideally I would like to self manage. I have a lot of time but I’m open to PMs also . Let’s just say I’ll hire a PM .
D. If I manage my self I’m willing to go maybe to Nevada , Arizona , basically any stays surrounding California . If I hire a PM I’m willing to invest further East !
E. My goal is to generate cash flow from multiple properties (of course build up my empire ) . Potentially both . Appreciation would be nice I wouldn’t mind having both .
F. Investing in SFH OR MFH, to be honest I'm not too sure ... I honestly just want something to start that'll generate some cash flow and build up from there . What do you think about apartments ? Are apartments a good buy as a rental property ?
Hi @Brian Nguyen. Good for you for getting started. I have connected with several California investors who are eyeing Phoenix and surrounding cities because of the close proximity to CA. Right now we continue to be a sellers market, according to our market statistics. That is changing and I believe there will be more opportunities for buyers as inventory rises and some sellers become more motivated.
When that will happen is not clear, but potentially in the next 3-6 months (complete speculation, as no one can predict the future). I track all the market stats and we can see there is a slow change. This will benefit buyers who would be able to negotiate for concessions and other benefits.
All successful investors start with one purchase. Do what makes you comfortable...in a market that is convenient for you to travel to so you can check on your investment.
@Brian Nguyen yes apartments are a good investment. There are pros and cons to apartments, as well as SFH.
I'm moving from SFH into Multi because it will allow us to scale faster.
As @Greg Dickerson mentioned it's best to pick an area where you know and feel comfortable with, that will help with your comfort / confidence level.
There are a lot of books, webinars, and podcast you can learn from. I'd caution that you don't get analysis paralysis. Set a goal, do your due diligence and take action.
I believe as @Melanie Johnston stated the market will become a buyer's market in the coming months. Don't rush into a deal, but don't pass on one because you expect everything to be just right.
Once you find an area you're comfortable with I recommend you find an agent / broker and a contractor to build a relationship with. Again, do your due diligence on these people. They can help you reach your goal, or they can take you for a ride.
Thanks Carl !! How would one do their due diligence on the contractors and real estate agents ? How can I tell if they’re trust worthy ?? Thanks Carl !
@Brian Nguyen when I found my agent / broker and primary contractor I listened to what they were recommending then got a 2nd or 3rd opinion. When I saw that they were consistently working with me, with my best interest in mind even when it was against their interest I knew they weren't going to take me for a ride.
Example 1: Agent / Broker...I had a contract on a house with some repair contingencies built into the contract. This was back in 2004. I was going to walk away after closing with $5,000. The day before the closing I did a walk through and saw where the owner cut some corners on the repairs. I had the agent terminate the contract for what essentially would have been a $50 repair.
Consider that I walked away from $5,000 at closing plus future profits, and the agent didn't get his commission for what amounted to $50. Years later the agent mentioned it and I asked why he didn't make that point at the time. His response, "it's what you wanted and since you were still learning I thought it best to not push you into a deal you didn't like." I have closed every deal since 2004 with this agent / broker.
As for my primary contractor, in the beginning he was responsive to my calls / request. He was fair on his pricing. Starting out I would get 3 bids on a job, he consistently came in at the average or a little lower, but his work standard is excellent. He also did what he said he would do when he said he would do it. We've been working together 17 years.
When you start working with a contractor I recommend you avoid giving a deposit. If they need supplies go buy them and have them delivered at the job site.
If you do give a deposit have a written contract that states when payments (to include the deposit) will be paid connected to a specific performance.
I wrote an article on exactly what to look for and how to find it. Make sure you are purchasing in growing cities with a large population base. Make sure that it is an easy flight or short drive. Once you find a market, work diligently as building your team as well.