Where to start as a Southern Californian?

Question

Hi BP investors!

I’m completely new to the real estate world. I’m fully aware that I will have to spend the next year (at least) educating myself.
However, I am a wife and mother with a full time job. So I would like ideas on where to focus my attention.
I was really interested in a short term rental and still am to a degree but due to saturation and increased regulations I am weary of going there.
I’m also in a very expensive area (Orange County). This makes returns on long term rentals very minimal and short term rental arbitrage nearly impossible (very risky).
I’m also looking to start with a $30k investment which doesn’t make many mortgages or loans for homes in this area possible.
So my question is are many of you investigating in California?
If so, what area?
If no, what states have you seen developing into profitable markets?
And what types of investments do you recommend for a beginner?

Thanks for all the help!

Karina

Nathan Gesner · Answer

You can't buy a phone booth for $30,000 in Orange County, particularly in today's market that has been steadily growing for years. You should educate yourself on how to find affordable markets that meet your goals. Check out Long Distance Real Estate Investing by David Greene in the bookstore.

Joe Homs · Answer

@Bessy Reyes I have been investing in California for over 40 years. Since California goes in cycles I would start out with educating yourself on these cycles so you better understand the local market. Continue that education about Real Estate in general that you can really use anywhere. There are different issues in all states and if you do decide to invest out of state make sure you know the rules before you jump feet first.

Currently most of us are flipping homes, but that is also becoming a tight market. Forbearance is ending in December, so look for some opportunities after then. Prepare for what is coming by educating yourself on distressed property sales, short sales, creative financing, and other tools to purchase homes.

Good Investing...

Nathan Gesner · Answer

Start by looking for states that are Landlord friendly. Then narrow it down to a particular city that seems to come close to the 1% rule. Continue narrowing your search to a specific neighborhood based on schools and other important factors. David talks about all this in his book.

Personally, I wouldn't do a lot of research in a city/community until I found a good property manager and REALTOR. But it's hard to build a relationship with professionals when they don't know how solid you are as a buyer.

Bessy Reyes · Answer

@nathan

@Nathan G. I have that book next on my list. I’m currently reading David’s book on the BRRRR method. Do you have any market suggestions?My goal is to spend a year just learning both about investing but also about out of state markets.

I’d appreciate any suggestions as there are a lot of marketplaces across the US that seems to be growing but I just don’t know much about.

I will also start reaching out to people in those markets for advice.

Thanks for all the help!

Bessy Reyes · Answer

@Joe Homs Sorry for the delay in responding but I just now figured out how to do so.

I really appreciate your response. It’s exactly what I was looking for. Both the reality but something to move towards.

I am now focusing more of my attention on how to buy a distressed property and then hold on to it.

I just started David Greene’s book on BRRRR method.

I’ll likely aim for out of state investing so I plan on reading Brandon Turners book on long distance real estate investing next.

I’m also reading forums to see what marketplaces seem to be up and coming. Hopefully allowing me to spend the next year finding and becoming familiar with an area and their cycle.

Again, thanks a lot!

Where to start as a Southern Californian?

Where to start as a Southern Californian?

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