Newbie in San Diego, but not investing here

15 Replies

Hi all. Joined BP a couple of weeks ago and quickly realized I needed to join the Pro side. Not because I am one, but because I want to be one. Anyway, about me: I live in San Diego, where every type of real estate is expensive. I have had a couple of rentals in the past. One experience was great and the last one was, well not so great. Before venturing in again I decided to make a couple a changes, 1. Look outside of Soutthern California, and 2. Get more knowledge. so I just bought my first out of state (San Antonio, TX) single family home and I am looking to do more. Advice and recommendations are not only welcome, but greatly appreciated. Thank you in advance and I look forward to learning from you and maybe someday partnering with you.

Hey Keith! Good call on the Pro account :) That's great you got a property in San Antonio. How did you get connected with that one?

Happy to chat anytime. I'm up in LA and have always bought out-of-state as well.

Thank you Antoine  and Ali.  I would be very interested in chatting with you guys soon.  I imagine LA is just as bad as San Diego, market wise.  Living in SoCal and buying out of state comes with its own set of clallenges and it makes it hard to do the due diligence necessary.  I would love to compare what I am doing with what has worked for you.

Ali, to answer your question, I started looking in the San Antonio area as a future retirement area and the agent I hooked up with is also a property manager. I fould the deal, a SFH, but he has been doing the leg work. He had the locks changed and a remnant the day after closing. Not making a ton, but it is a start.

Keith,

     Let me know if I can help. San Antonio is great but also generally overvalued in my opinion. Not an economist but it is feeling a bit frothy to me. Our prices are generally lower than Austin but wages are too. We are looking for for deals and struggling to find ones that make sense for our strategy. 

     I think long term we are way less volatile than some California markets (as seen in the last downturn) so there is some sense of security holding through whatever is to come - in my opinion.

     Good luck and welcome!

Hey @Keith Kaufman

Welcome to BP!

Sorry to hear that your local investments didn't go as well as you anticipated. I would urge you to not give up on the market entirely due to one bad experience, but that is a decision only you can make.

Having said that, please let me know if you'd ever like to chat about getting back in the market here in SD.

Always happy to help!

Kevin

@Kevin Fox,

Thanks. I am not saying I will never invest in California.  However, for a buy and hold strategy, the initial investment is pretty high and the cap rate is low.  From what I have seen, my cash income would be about the same as what I can expect for houses 1/3 the cost in the San Antonio area.

@Keith Kaufman I have been active in the San Antonio Market for several years now and from a cash flow stand point we have a great rental market. Pretty much the only area that I focus on is SFR rental property.

While I agree with @Will Pritchett on the over valued part I feel we are far less over valued as some areas of the country but you are buying for cash flow not some much as equity. That being said over the long term you are going to win.

It isn't hard in the market to find houses that should cash flow at least $300 a month. The great thing about buying SFR for a cash flow rental property for the long term is even if values drop in the short term because of a down economy rent prices increase because no one wants to purchase housing when home values are falling.

You just need to be a little careful in the area that you are trying to invest. Depending on your strategy you need to understand where the good rental areas are. If you would like I can send you a break down on the city by zip code for a reference. Just shoot me a PM

I also put out a monthly market report that I can send out to you if you would like.

Happy Investing!

 Keith, have you considered investing in the Houston metro area? What price point and criteria are you looking for? Let me know how I can help! 

@John Barr. Mostly looking north and northwest. Just bought an SFR that is providing positive cashflow in Helotes. Also looking toward Bulverde.

@Shenice B.  Haven't looked at Houston only because I will probably retire in the San Antonio area.  That being said, I am more interested in a good cash flow than I am a particular city.

Thank you both.

@Keith Kaufman You have the right idea for rental properties. the NE and NW, in my opinion, provide the best opportunities for cash flow and appreciation. 

I like the NW because we have a booming business district that is taking off along the 151 and I-10 corridors. The expansion of the infrastructure system is allowing people to commute much easier to get to those corridors. I will say that I have seen such a massive spike in the prices of homes over that way that it in such a short period of time rents have not been able to keep pace to provide great returns.

The vast majority of all of the properties that I have been working on lately have been over in the NE along the 35 corridors. I like this area because of its relation to all of the expansion between Austin and SA. While I have been seeing increases in prices I have also been seeing increases in rents because of the low inventory of good housing. You also have Randolf and Fort Sam Houston in that area so you have a very strong rental base. I am just finding properties with much better returns right now on that side of town versus the NW and W side of town.

If you have other questions about SA feel free to reach out.

@Keith Kaufman , welcome to BP! I'm also a new member, haven't gone pro yet, but you seem to know the California market well. I just moved to Sacramento, and am planning on investing here, if I can find sensible deals. I don't know the market well here, but it sounds like out-of-state might be the way to go. I would love to attempt Sacramento/Northern California, but home prices are high here, too. With out of state, do you use turnkey investing, or do you have another method? And again, welcome to the forums!

@Keith Torsen , thank you for the welcome. I decided to go Pro mainly for the calculators. I like to be able to save the calculations and go back with better numbers to see how that affects the deal. The ability to watch archived webinars is also a big plus. With regard to out of state investing. I started down that path accidentally. I had done a couple of deals in Southern California, selling the last one this last September and just had the proceeds from that sale sitting in a Money Market doing squat. My wife and I started visiting San Antonio as a possible retirement location. The agent I started working with is also a property manager and the idea was that I would buy my retirement home and he would rent it out in the mean time. However I quickly decided that people that could afford to rent in the areas that I wanted to retire in could also afford to buy there. So I decided to look at strictly rental properties. Properties that would provide a steady stream of income, but not transition to a future home for myself. I eventually found a deal in an area close to a major medical center, the University, and a military base. The school district is top notch and the homes are of a modest size 1500-1900 sqft single story. Well, I bought the first property in July and am looking for the next property as soon as the storm blows through. My goal is to have five long term rental properties in the area before I retire there in 2019 and then start employing the BRRRR strategy when I am closer to the properties.

So to finally answer your question, kind-of turnkey, as in the property that I am looking for is rent ready, but I don't work with a turnkey company as I prefer to use my own property manager to screen tenants.

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