Investing in Bakersfield? Areas to avoid?

Question

Hi everyone,

My name is Mahmoud and I am new to Bakersfield. I am interested in purchasing a rental property, particularly either a single family home in the low 100s, or a duplex in the low 200s. But, I am not sure about whether to look at east Bakersfield or Oildale, as I read mixed reviews on both areas. Ideally, I would want a property management company to manage the property as I am busy with work.

I was wondering what you thought about investment properties in Bakersfield. I see tons of houses for sale on redfin. Is it hard to find tenants to rent? How long would you say it usually takes to get tenants in the property?Thanks so much,Mahmoud

Thanks so much,Mahmoud

Mahmoud

Gene Hacker · Answer

Oildale has some ok areas but much of it is pretty rough. I do a lot of inspections for out of areas investors in oildale.  Some are decent but many are not so great.  The less expensive areas tend to have pretty old houses and there tends to be a trend of deferred maintenance.

I highly recommend spending a day or two driving around and taking notes on different neighborhoods and areas.  Bakersfield is small enough that you can get "the lay of the land" in a day or two.

You can also use google street view to "tour" the streets around specific subject properties.

Joseph Lopez · Answer

Hi Account Closed

Jeanine P. · Answer

Account Closed In addition either NW or SW good rental for sfh or multi. Eastide you will find better cash flow. I have wholesale properties on the Eastside often and specialize in probate and I see the difference in price, spread, roi and cap rate. However some parts of the Eastside are not so great. Try section 8 tenants for rental guarantee if you are concerned about the rougher areas.

Account Closed · Answer

My parents made a fortune off of RE investing in Bakersfield when the recession hit. We were getting homes in the best parts of Bakersfield for under $100k and they now have more than doubled in value. I have a few homes there as well.

Stay away from the East side of Bakersfield, only invest in the West as it's much more developed and the demographics are much better. The Southwest is great for SFH.

Only problem with Bakersfield, in my experience, is that it takes a while to find a good tenant. I currently have a very nice home for rent in the Southwest and it's been vacant for a while. I've received dozens of calls and inquiries, but thus far they all have either had a very low income (rent would be over 50% of their net income) or they have a criminal background. Once you find a good tenant though, they usually stay for a long time, so it takes patience and good screening.

Gene Hacker · Answer

@Mark De sagun, you may try reaching out to @Sanjeev Advani, he works with a lot of out of area investors.

I don't know if the worst areas of oildale will be gentrified in a meaningful way, maybe, it will be interesting to watch what happens.  1000 to 2000 new jobs nearby certainly will not hurt.

Jim Barksdale · Answer

My daughter went to Cal State Bakersfield started in 2009, We bought a nice 3 bedroom home that was about a mile south of CSB. Purchased it for about $115,000 with about $5,000 of my cash. mortgage was about $850 a month plus utilities. She had 2 girls that she played sports with from CSB that rented the other two rooms for $500 each. The 7 years she lived there, she always had two roommates. My daughter and I never paid for anything except a few upgrades. We sold it about 2016 for $200,000. She made about $80,000 cash and lived rent free for 7 years.

Bakersfield was good for her;  A good education, free rent and some cash for a down payment on a home on the central coast.

Crime is everywhere in Bakersfield. Some areas on the east side of 99, I wouldn't drive there at night. That being said, I'm looking all the time for investment there.

Good luck Jim

Mark De sagun · Answer

@Jeff Cagle @Joseph Lopez @Gene Hacker I'm new to REI and am looking for my first property. I plan to spend a day or two in the bakersfield/taft/oildale area to check it out. Would any of you know of someone who might be able to show me some properties in different bakersfield neighborhoods?

@Joseph M. Do you think that amazon fulfillment center is reason alone to look for investment in oildale? I feel like that area will gentrify and appreciate, but most of the stuff I read about that area currently is negative.

Jeff C. · Answer

Parts of East Bakersfield and Oildale are pretty rough. We do a lot of flips here and in some of these areas we have to have people stay in the properties until they're sold, as they'll get disassembled as fast as fast as we put them back together otherwise (this is an issue in Taft as well). These properties are also generally very old and many weren't of great quality in the first place. As an out of town owner who needs things to run on autopilot, if I were you I'd spend a little more and buy something of more modern construction in a better part of town. There's a big difference between nominal and actual returns, and that gap gets wider and wider the crappier the neighborhood gets. I do realize that many have made decent money at the very low end of the market, but that takes quite a strong stomach, and I believe also was a function of particular market conditions which aren't likely to exist again any time soon (IE these properties got absolutely crushed in the downturn of a decade ago and were picked up for a song. That isn't the situation now).

Joseph M. · Answer

Just read about the new Amazon fulfillment center that will be built in Oildale. It will bring about 1500 jobs, which is good for the area of course. Having a big name like Amazon come into an area is always good.

Couple articles about it

https://www.bakersfield.com/columnists/robert-pric...

https://www.bakersfield.com/news/amazon-plans-million-square-foot-fulfillment-center-next-to-meadows/article_3f1ae04a-aa28-11e8-9258-479cabb00bdc.html

Jacob Villalobos · Answer

From what I hear Oildale, is still confederate land. Beware

Investing in Bakersfield? Areas to avoid?

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