New to RE investing in San Diego County

San Diego, California
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New to RE investing in San Diego County

Michael James
Member since 2023 路 8 posts 路 4 votes

I am currently doing a crash course to learn as much as I can, and hoping to take the plunge in the next few months. Any guidance on where to focus my education efforts would be appreciated. Also, if there there is a mentor willing to help me start this journey I will gladly welcome your wisdom and kindness.

Sincerely,

Michael James

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Jake BakerBusiness Member
Flipper/Rehabber 路 San Diego, CA 路 Member since 2020 路 1k+ posts 路 696 votes
2y

@Michael James

Best thing you can do is go to meetups in San Diego. You can see what others are doing and make good connections. 

I recommend buying a primary residence (with the intention to turn it into a rental eventually). It a great first step. You get better financing that way as well. 

[email protected]
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  • Jake BakerBusiness Member
    Flipper/Rehabber 路 San Diego, CA 路 Member since 2020 路 1k+ posts 路 696 votes
    2y

    @Michael James

    Best thing you can do is go to meetups in San Diego. You can see what others are doing and make good connections. 

    I recommend buying a primary residence (with the intention to turn it into a rental eventually). It a great first step. You get better financing that way as well. 

    [email protected]
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  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y

    Thank you, Jake! Yes, I am looking forward to attending local events and meeting people.

    0Reply
  • River SavaPro Member
    Lender 路 USA 路 Member since 2022 路 1k+ posts 路 1k+ votes
    2y

    Hi Michael, welcome to BP!

    Are you thinking about investing in SD?

    [email protected]
    1Reply
  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y
    Quote from @River Sava:

    Hi Michael, welcome to BP!

    Are you thinking about investing in SD?


     Hello River, thank you! 馃檹

    Yes, I am. Within 2 hours drive of the San Diego North County area.

    0Reply
  • River SavaPro Member
    Lender 路 USA 路 Member since 2022 路 1k+ posts 路 1k+ votes
    2y
    Quote from @Michael James:
    Quote from @River Sava:

    Hi Michael, welcome to BP!

    Are you thinking about investing in SD?


     Hello River, thank you! 馃檹

    Yes, I am. Within 2 hours drive of the San Diego North County area.


     Great area!! Curious if you are thinking about flipping/househacking at all

    [email protected]
    1Reply
  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y
    Quote from @River Sava:
    Quote from @Michael James:
    Quote from @River Sava:

    Hi Michael, welcome to BP!

    Are you thinking about investing in SD?


     Hello River, thank you! 馃檹

    Yes, I am. Within 2 hours drive of the San Diego North County area.


     Great area!! Curious if you are thinking about flipping/househacking at all


     No, River. Just purchase, rehab, and rent.

    0Reply
  • Julio GonzalezPro Member
    Specialist 路 West Palm Beach, FL 路 Member since 2008 路 4k+ posts 路 1k+ votes
    2y

    Welcome aboard, Michael! Your dive into learning for this new journey is exciting!

    -Julio

    561-253-6640
    1Reply
  • Andrew SyriosPro Member
    Moderator
    Residential Real Estate Investor 路 Kansas City, MO 路 Member since 2014 路 10k+ posts 路 5k+ votes
    2y

    Welcome to BiggerPockets Michael and best of luck investing!

    Podcast Guest on Show #121
    1Reply
  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y
    Quote from @Julio Gonzalez:

    Welcome aboard, Michael! Your dive into learning for this new journey is exciting!

    -Julio

    Thank you, sir! 馃檹 
    0Reply
  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y
    Quote from @Andrew Syrios:

    Welcome to BiggerPockets Michael and best of luck investing!


     Thank you. 馃檹 

    1Reply
  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y
    Quote from @Account Closed:
    Quote from @Michael James:

    I am currently doing a crash course to learn as much as I can, and hoping to take the plunge in the next few months. Any guidance on where to focus my education efforts would be appreciated. Also, if there there is a mentor willing to help me start this journey I will gladly welcome your wisdom and kindness.

    Sincerely,

    Michael James

    It kind of depends what you want out of real estate. A list of what is taught is at https://www.biggerpockets.com/forums/311/topics/1146250-how-... take a pad and pencil and write down teh areas that interest you.

     Thank you, Ken.

    1Reply
  • Tim Ryan
    Investor / Mentor / Contractor 路 Arcadia, CA Buying Out of State 路 Member since 2015 路 655 posts 路 622 votes
    2y

    Hi Michael. Welcome to BP!  I am in Los Angeles.  I have been investing out of state since 2009 and it's been great. Let me know if you are interested to learn about this.  I have no experience with San Diego other that I know it's extremely expensive and we are still at the height of the market ;)

    1Reply
  • Nate MeekerBusiness Member
    Real Estate CPA | California 路 Member since 2020 路 544 posts 路 251 votes
    2y

    @Michael James welcome! You are in a great market, all of my rentals, brrrs, and wholesale deals have been in Pensacola, FL. Direct mail and cold calling go a long way, I've scored some deals from realtor relations as well before it hit the market.

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  • Dan H.Pro Member
    Investor 路 Poway, CA 路 Member since 2015 路 7k+ posts 路 8k+ votes
    2y

    I have been successful in San Diego doing what you indicate, rehab and rent or BRRRR (Buy, rehab, rent, REFI, repeat). However, I have not purchased since Dec 2021 (purchase $4m that month).

    I can still find properties that can benefit from a rehab. My issue is after the high LTV REFI, they are large negative cash flow. this s because rates have doubled since Dec 2021. Therefore these rehab projects scream flip, but flipping is a job versus residential RE is not passive but it is far less effort than flipping.

    My point is that San Diego and virtually all markets have gotten much more challenging since the rates have doubled.   I think more so for the traditionally high appreciation markets that leverage traditionally has produced outrageous returns. 

    My best advice is used conservative underwriting. I am currently using -4% near term appreciation. This is because I am expecting near term appreciation at between -4% and 4% and I want my underwriting to be conservative. I do expect the long term appreciation to exceed CPI. Also when including reasonable PM cost (should be included regardless of if self managing), the 50% rule is fairly accurate on low b, high c properties at purchase. Due to prop 13 combined with high rent increases, the expense as a ratio goes down with time. Initially the prop tax on a 0.6 rent ratio property alone is almost 17% (20% on a 0.5 rent ratio). Mortgage also typically being fixed implies that cash flow typically improves fairly fast but if it is negative $1k/month or more (I have seen many purchased that if purchased with high LTV would be this negative) it will take time for it to become positive

    Second best advice is do not believe other people鈥檚 under writing.  

    You can PM me if you have any particular questions on the San Diego market in particular.  

    Good luck
     



    0Reply
  • Michael James
    OP
    Member since 2023 路 8 posts 路 4 votes
    2y
    Quote from @Tim Ryan:

    Hi Michael. Welcome to BP!  I am in Los Angeles.  I have been investing out of state since 2009 and it's been great. Let me know if you are interested to learn about this.  I have no experience with San Diego other that I know it's extremely expensive and we are still at the height of the market ;)


     Thank you, Tim. Yes, I would appreciate learning anything you are willing to share.

    0Reply
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