New investor looking for a little guidance
San Diego, CA · Member since 2016 · 2 posts · 4 votes
New investor looking for a little guidance
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Realtor · Ogden, UT · Member since 2019 · 338 posts · 415 votes
4yHey Bryan,
I know these price hikes and rising rates are discouraging but as landlords, we have the opportunity to be the winning side of things. It's always tempting to want to look at other markets and see where the grass is greener but I've found that rents are rising almost as quickly as prices and deals continue to exist in all markets.
I'm in the greater Salt Lake area of Utah and though not as crazy price-wise as San Diego, we've still seen crazy price spikes. Nevertheless, rents have shot up as well and I've still been able to accumulate units in my local market where I know the market the best. I just have to make sure I have my rents and ARVs dialed in.
Me belief is that it's always better to start local so you can have a real hands-on experience even though that view isn't shared by all investors. I'm sure if you're spending the appropriate time and building the right network, you'll still be able to thrive in San Diego!
Good luck!
11 Replies
- Realtor · Ogden, UT · Member since 2019 · 338 posts · 415 votes4y
Hey Bryan,
I know these price hikes and rising rates are discouraging but as landlords, we have the opportunity to be the winning side of things. It's always tempting to want to look at other markets and see where the grass is greener but I've found that rents are rising almost as quickly as prices and deals continue to exist in all markets.
I'm in the greater Salt Lake area of Utah and though not as crazy price-wise as San Diego, we've still seen crazy price spikes. Nevertheless, rents have shot up as well and I've still been able to accumulate units in my local market where I know the market the best. I just have to make sure I have my rents and ARVs dialed in.
Me belief is that it's always better to start local so you can have a real hands-on experience even though that view isn't shared by all investors. I'm sure if you're spending the appropriate time and building the right network, you'll still be able to thrive in San Diego!
Good luck!
- Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes4y
Quote from @Bryan Zuelch:
Hello fellow investors,
I've been working hard for years to get to this point! I've got a nice down-payment an ACTUAL approval and basically my ducks in a row to start my first investment. My new problem are these crazy price hikes, I'm in the San Diego County and I dont know if I'm able to keep up with these prices?!! Does anyone have any advice or know of a good out of state market that might have more to offer a new( first time) investor?!
Thank you in advance!
I realize that prices are much higher, but look at the flip side... At least rates are much higher...
(oh crap. nm) - Member since 2018 · 138 posts · 56 votes4y
Advice in San Diego....if you gonna live in San Diego for the foreseeable future, I would consider buying what you can afford to live in....give consideration to house hacking in some form to lessen the burden. This may mean you dont get the neighbor hood you really want or you have to sacrifice on the size. As far as rates go they dont really matter because you have to make offers based on what you can afford now with the new rates......if they go down later you can refi....if they go up you'll be happy you got in at 5% (ish), which is still low by historical standards. Problem as a renter is: as rates and inflation go up you will have to bear the brunt of those increases in your housing cost, whereas as a owner your hedged against the increase.
If you WANT to look out of state I recommend you look at the closest state to you which is arizona.....yuma will be the first city there.....its about 2.5 hours away by car. Get on the 8 and head east. Prices there are still sane(ish). Its a small market that has a high snowbird population spike in winter plus a large military presence (2 bases) so you may be able to find an opportunity there and its still within driving range if you need to see what's going on (and you can walk your prospective properties). If that doesn't work move to the next. Keep in mind desert communities are kind of funky in that the land is usually not that valuable in itself. You have to be next to some kind of anchor, and some of those anchors are more transitory than what we see in San Diego where values are based on proximity to the beach (mostly). Realtor.com has good coverage of that market.
- 4yTwana RasoulBusiness MemberReal Estate Agent · San Diego, CA · Member since 2017 · 1k+ posts · 1k+ votes
@Bryan Zuelch Look into house hacking in San Diego before looking out of state. In San Diego you can put 3-5% down and owner occupy a property, out of state you'd like put 20-25% down so even with higher prices you likely would be putting less of your money into a property here for down payment/closing costs.
Just remember when you go to another market where prices are a fraction of San Diego and think about why it is so much cheaper....if you must go to another market, understand the local economy. If that local economy is booming due to 2 or 3 industries/factors such as a military base, think about what would happy to the value of local real estate if that military base closed down.
Compass5122 Reviews - Realtor · Spokane, WA · Member since 2020 · 138 posts · 87 votes4y
Quote from @Bryan Zuelch:
Hello fellow investors,
I've been working hard for years to get to this point! I've got a nice down-payment an ACTUAL approval and basically my ducks in a row to start my first investment. My new problem are these crazy price hikes, I'm in the San Diego County and I dont know if I'm able to keep up with these prices?!! Does anyone have any advice or know of a good out of state market that might have more to offer a new( first time) investor?!
Thank you in advance!
Welcome to BP, Bryan!
I could totally understand you with these prices. But that is awesome that you are open to investing out of state. Spokane, Washington has been booming also. Feel free to message me to know more about Spokane!
Also, what are you plans for investing. Are you planning of house-hacking or completely have it as an rental-investment?
I am currently house hacking also, and when I started I have limited funds but I was able to use FHA with low downpayment. I have some lenders that could have some loans, that you might be able to qualify! @Grant Schroeder
- Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes4y
Quote from @Bryan Zuelch:
Hello fellow investors,
I've been working hard for years to get to this point! I've got a nice down-payment an ACTUAL approval and basically my ducks in a row to start my first investment. My new problem are these crazy price hikes, I'm in the San Diego County and I dont know if I'm able to keep up with these prices?!! Does anyone have any advice or know of a good out of state market that might have more to offer a new( first time) investor?!
Thank you in advance!
Great job,Bryan!
You should consider investing OOS here in Columbus or Cincinatti. The price to rent ratio makes for great investments. Not to mention our appreciation has been 8% higher then the US national average, because of the high demand for affordable housing. I help investors buy properties here everyday. - Real Estate Agent · Seattle, WA · Member since 2019 · 301 posts · 188 votes4y
That's an awesome position to be in Bryan! It can certainly feel impossible sometimes, especially with the rising prices. My advice is just to find something that works for you and just go for it. Don't get too bogged down by the details. Focus on what you want and go for that.
- 4yGrant SchroederPro MemberLender · OR ID AZ CA WA CO NV TN MT · Member since 2018 · 598 posts · 312 votes
Quote from @Zierry Eme Carl T. Tagbas:
Quote from @Bryan Zuelch:
Hello fellow investors,
I've been working hard for years to get to this point! I've got a nice down-payment an ACTUAL approval and basically my ducks in a row to start my first investment. My new problem are these crazy price hikes, I'm in the San Diego County and I dont know if I'm able to keep up with these prices?!! Does anyone have any advice or know of a good out of state market that might have more to offer a new( first time) investor?!
Thank you in advance!
Welcome to BP, Bryan!
I could totally understand you with these prices. But that is awesome that you are open to investing out of state. Spokane, Washington has been booming also. Feel free to message me to know more about Spokane!
Also, what are you plans for investing. Are you planning of house-hacking or completely have it as an rental-investment?
I am currently house hacking also, and when I started I have limited funds but I was able to use FHA with low downpayment. I have some lenders that could have some loans, that you might be able to qualify! @Grant Schroeder
Thank you for the shoutout @Zierry Eme Carl T. Tagbas! Glad to help anyway I can @Bryan Zuelch!
- San Diego, CA · Member since 2016 · 2 posts · 4 votes4y
Thank you all for the feedback and will definitely be doing some research as far as all the great advice. :)
- 4yRemington LymanBusiness MemberReal Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
Quote from @Bryan Zuelch:
Hello fellow investors,
I've been working hard for years to get to this point! I've got a nice down-payment an ACTUAL approval and basically my ducks in a row to start my first investment. My new problem are these crazy price hikes, I'm in the San Diego County and I dont know if I'm able to keep up with these prices?!! Does anyone have any advice or know of a good out of state market that might have more to offer a new( first time) investor?!
Thank you in advance!
I know a lot of people that do OOS investing here in Columbus, Ohio
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