An investor would invest in either location, depending on a number of factors, including:
- The long-term strategy of the investor: are they investing for ROI or cash flow? Cash flow is probably not possible unless the investor intends to hold the property and do vacation rentals.
- Does the property offer a flip or new development opportunity?
- Can the developer buy the investment at a price that makes the deal profitable?
- What does the zoning, entitlements process and development environment look like if the property is going to be flipped or developed? Is the property part of the Coastal Commission, subject to the Hillside Ordinance or other governmental regulation which restricts development activities?
- What is the price of the property - is there upside for the investor to do value-add and build equity?
This is a very generic question, but in general, the answer depends on the property and type of opportunity it presents to an investor.
Assuming by security, you mean the market shows consistent appreciation with little volatility compared to other places the investor could deploy their capital, I would argue that either location is somewhat insulated from the fluctuations seen in the macroeconomy. Both are high-demand, high-value areas that have shown consistent long-term growth.
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