28 year old Newbie from California here... Currently residing in Southern California; however, I was born and raised in Monterey, CA. I purchased my first property (2 Bed 2 Bath condo) in Temecula, CA in 2014. I have always been interested in real estate investing so I joined the BP community to reach out and network with fellow investors. My first purchase has appreciated fairly decent (~50k in equity) over the past few years. This has really got me fired up and anxious to learn more about REI.
I am interested in learning more about purchasing multi-family units in California; although, prices are a bit high right now. I'd love to hear any advice or recommendations from investors who have much more experience than I do. Thank you!
Hey Chandler! Well it depends on what you want to do or what you want to accomplish with a property in terms of what people can recommend. If you want straight cash flow, that's one thing, if you prefer local hands-on and that's more important then that's another thing, appreciation is another (prices are high right now, yes), do you want to landlord or are you cool giving up that job to someone, etc. And by MFR, do you mean residential MFR (2-4 units) or commercial?
Hi Chandler, Temecula is a great market as is the rest of the Inland Empire, as mentioned before it really depends on how you want to invest I can recommend a couple cities for multifamily investing in the region. and discuss further if you would like.
Thank you Ali and Aaron for your response. I would like to invest in MFR's (residential) for cash flow as part of my retirement plan. Depending on the distance of a unit, I will more than likely hand it off to a PM. I have just started researching about investing OOS in the Midwest; however, I've heard a lot of people warning against it. I've also heard of people having a lot of success.
Aaron - Yes, I'd appreciate any recommendations for cities to purchase a MFR in the inland empire or surrounding areas. Thank you!
Welcome to the game @Chandler Canepa let's connect on BP!
Multi-units vary greatly in cost depending on the area. In Southern California, it'll be tough to find anything that cash flows well for less than $500k, although typically the more inland you go the better. I would highly recommend the Central Valley cities if you are looking for a cash flowing multi-unit property for less than $300k. There are a few really healthy rental markets there and it's really affordable.
For some reason, when I see people warning against it, it's people who aren't actually doing it. So not quite sure how they come to those conclusions. There are certainly risks in it, but there's risk in every investment and it's all about the mitigations.
I live in LA and have only invested OOS. If you want cash flow, it's going to be about your only option.
Reach out anytime if I can be of any help!
Hey @Chandler Canepa I have to agree with @Ali Boone . Investing out of state is risky when you don't do the research and find people to help you out. Fortunately, it gets easier and easier every time. I live in LA as well and invest in and around Tampa because cashflow is my goal.
There's an out of state real estate investors of LA group on Meetup you should check out. We do events every 2 months to connect out of state investors to share ideas and strategies. (I'd post the link here but I think BP would block it.) Message me and I'll share it with you.
Best wishes on your journey!
Wow, thank you everyone for your responses. What an awesome community! I won't be ready to buy until next year around June, but I'll definitely be doing research on all of the places you all have mentioned.
Welcome @Chandler Canepa . I own a Single Family house in Temecula that cash flows quite okay but that's because I bought it dirt cheap during the crash. Otherwise finding cash flowing properties in California is tough (unless you are buying properties cash and can suffice with a 3-5% return yearly). But the good thing about living in California is the high paying jobs compared to most other areas. As a result, I am able to bought properties for cash in Ohio that cash flow very well. Like others have said, it is about who is on your team there that really makes or breaks it. For Californians, OOS investing is the only way to go if you are starting off and want to accelerate your financial freedom, in my opinion. Unless you are house hacking, that's just a different story.
@Chandler Canepa , welcome to BP! You're in the right place. If your eyes do indeed turn to Florida, I'm currently working with several investors from California and New York who are seeking the same. I have market reports on the Central Florida (Orlando Metro) market.
@Maira Asad I always say- start by talking to other people who are already doing it. You'll start hearing certain markets get repeated by a lot of investors, and once you know where a lot of people are investing, you can then start weighing all of those against each other and realizing what it is about those places that are luring people into them. That's one way. Another is a lot of people want to invest in places they are from or know people in or travel to often. Those of course should be evaluated for whether they make sense for investing, but they are always options.
Happy to chat more if you want to message me anytime!
I agree with @Max Gradowitz , Central Valley investments have been really good to me and my family over the years.
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