Hello,

my name is Stephan, living in the US for ~3 years and recently moved to San Diego ( my wife and I love it here). Due to tax reasons I will move money from my home country (Germany) to the US  ~200-300k and looking to invest in real estate.  Given the San Diego prices I wonder if its a better idea to look for opportunities in Las Vegas or Phoenix since they are a short flight away. I am not looking to buy a single house (too much concentrated risk).  I am happy about all tips how I could maybe invest in the San Diego area after all given my budget (1-1.5M given 20% down)

Sincerely

Stephan

@Stephan Ketterer Welcome to San Diego and BP. 

Your strategy will depend on your goals. Are you looking to primarily generate cash flow from this investment? Are you looking at it as a long term equity play? little bit of both? 
If you're not looking to buy a single family home, what type of properties are you looking into? 

San Diego is a great market but I know that price points are a little higher here and cash flow is not so easy to find. However, it is an appreciation market so long term it's a great place to invest. 

You also have the option of buying a distressed property and adding value to it so you can build equity from the start. Do keep in mind of course that doing so will require time, effort and education as opposed to buying a turnkey... 

Best thing you can start doing is to start looking at deals and evaluating them to get a feel of what the numbers actually look like here in San Diego and also in the different markets you're looking into. 

Hope that helps. Best of luck and Happy Holidays! 

@Stephan Ketterer Start with a 2 to 4 unit multi family in San Diego...San Diego real estate is higher priced for good reason...it is a great quality long term asset.  You'll have great long term appreciation as well as cashflow, contrary to popular belief.   

Originally posted by @Twana Rasoul :

@Stephan Ketterer Start with a 2 to 4 unit multi family in San Diego...San Diego real estate is higher priced for good reason...it is a great quality long term asset.  You'll have great long term appreciation as well as cashflow, contrary to popular belief.   

 I am curious where you think the appreciation will come from. On average, Americans cannot spend more on rent due to having  little savings(on average). So that leaves either people making significantly more money (I have a hard time believing that) or an external group of renters entering the market. Due to the high California taxation I wonder if that is realistic, definitely not people in tech as seen in the Bay Area. 

The past 12 months we've had nearly double digit appreciation and we are projected to have nearly the same level of appreciation the next 12 months.  Supply and demand and low interest rates have been giving housing quite the boost.  Since you mentioned the Bay area, I've worked with several bay area clients recently who have purchased and moved down here since their tech jobs have gone to permanently work from home...similar story to others in Los Angeles, Portland and Seattle.  San Diego is a great city and it is much affordable here than other major metropolitan areas along the west coast of CA.  

@Stephan Ketterer

Find a value ad 2-4 unit property. Ad value, raise rents. As previously mentioned San Diego real estate will continue to appreciate. Let me know what I can do to help.

@Stephan Ketterer

Many reasons to invest in SD: 

• Median sales price increase year over year approximately 10%
• Months supply of inventory down to 1.2 (lowest we've ever had). 
• Very low supply to high demand. 
• SD increases in rent 3-4% a year. An increasing rental market will generally follow a similar trend line w/ an appreciating market. Know that cash flow is actually quite good here, just not INITIAL cash flow generally. 
• Tech Boom is happening now here in SD. Prices started to skyrocket around June when Bay area, Boston, & NY tech related careers started to work remote and came here. 
• Inventory shouldn't change much over the foreseeable future. Running out of room to build and new construction isn't keeping up w/ demand.
• Recommendation is start w/ a 2-4 unit w/ a value add play. Majority of opportunity is in Metro SD, National City, Chula Vista and Oceanside / Carlsbad / Vista up in North County. 

Your total return will should great on a spreadsheet when factoring in compounding interest from appreciation over time, along w/ cashflow, prinicipal paydown, & tax savings.