Is Lake Elsinore a good place to buy?

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Is Lake Elsinore a good place to buy?

Jordan Wight
Investor · San Francisco, CA · Member since 2019 · 26 posts · 33 votes

I'm starting to look at possible homes to buy as my first rental property. I'm new to real estate investing, so wondering if someone could look at the home in the below link and see if you think it's a good buy or not.

31173 Kansas St, Lake Elsinore, CA 92530

https://www.zillow.com/homes/31173-Kansas-St-Lake-...

1. My friend Chris owns a rental property in the same neighborhood and recommended it, but I want opinions from all of you!

2. A friend Chris is a real estate agent, and owns several rental properties in Lake Elsinore area. He looked at the house and strongly recommended it to Chris, but Chris didn't have the money right now, so that's how I found out about it.

3. The agent says it needs $2-3k of touch up maintenance/repairs. But it's recently renovated, so overall a really nice place and otherwise should be relatively low maintenance.

4. Lake Elsinore is supposedly one of the top 5 fastest growing communities in CA. True? Commuting distance to Orange County, and potentially LA and San Diego.

5. Square footage is only 1k. There are 3 bedrooms, other properties in the area seem to rent for $1600-$2200. So with purchase price of $265k that doesn't get very close to the 1% rule. Is this obviously a bad investment, or worth running more detailed numbers?

6. What else should I be looking at?

I had previously posted this is a general forum before I found out about the OC forum.

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Richard Bastar
Riverside, CA · Member since 2015 · 47 posts · 11 votes
6y

@Jordan Wight how did this go?

As of now, not many rentals in the area...so probably a good deal to look at, in the current times (only found about 4 or 6 rentals in the area on the internet, not including driving around seeing signs).  I think the Menifee/Murrieta/CanyonLake (if you can work that) are better areas.  I currently have one in Menifee and was looking at Lake Elsinore initially.  My rental taxes are 1.01...in fact, I've heard they're around the lowest in the area, but haven't actually confirmed that.  If it were me, I'd have to check pretty diligently on the other rentals in the area, to try and find solid comparisons (seems to hard right now 8/26/2020).  Seems alright though, and I wouldn't necessarily rule it out right away.  Then again, looks like your post is a year old...let us know.  Be interesting to see how things went.  OBVIOUSLY, it all (the deal in general) depends on your financing details.

Cheers, Rich

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  • Travis Troupe
    Member since 2019 · 1 post · 0 votes
    7y

    Hi, Have you tried any of the calculators on this site?

    0Reply
  • Kevin Lefeuvre
    Los Angeles, CA · Member since 2016 · 565 posts · 391 votes
    7y
    Originally posted by @Jordan Wight:

     other properties in the area seem to rent for $1600-$2200. 

     There is a huge gap between $1600 and $2200, but even at 1600, your gross cap rate is 7% which is well above any place in SoCal. But you may wait months before renting? I have no clue. If vacancy is not an issue and there is a good rental market there for this size of house then it's a deal. 
    Do you know if short term rentals are allowed there?

    0Reply
  • Kate Batals
    Member since 2018 · 18 posts · 3 votes
    7y

    Check the property taxes in that city. They have a high property taxes compared to Temecula and Murrieta. 

    0Reply
  • Christine Kankowski
    Real Estate Broker · Temecula, CA · Member since 2014 · 994 posts · 783 votes
    6y

    Rent for this would be under $1600-1800.   It is a growing area.  Surrounding areas like Menifee are growing as well, with good schools, etc. 

    0Reply
  • Richard Bastar
    Riverside, CA · Member since 2015 · 47 posts · 11 votes
    6y

    @Jordan Wight how did this go?

    As of now, not many rentals in the area...so probably a good deal to look at, in the current times (only found about 4 or 6 rentals in the area on the internet, not including driving around seeing signs).  I think the Menifee/Murrieta/CanyonLake (if you can work that) are better areas.  I currently have one in Menifee and was looking at Lake Elsinore initially.  My rental taxes are 1.01...in fact, I've heard they're around the lowest in the area, but haven't actually confirmed that.  If it were me, I'd have to check pretty diligently on the other rentals in the area, to try and find solid comparisons (seems to hard right now 8/26/2020).  Seems alright though, and I wouldn't necessarily rule it out right away.  Then again, looks like your post is a year old...let us know.  Be interesting to see how things went.  OBVIOUSLY, it all (the deal in general) depends on your financing details.

    Cheers, Rich

    1Reply
  • Jordan Wight
    OP
    Investor · San Francisco, CA · Member since 2019 · 26 posts · 33 votes
    5y

    @Richard Bastar - I didn't end up buying anything yet. Things got busy at my day job. But recently I've been looking into real estate again, and thinking about buying a turn key property out of state.

    1Reply
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