BRRRR Deals : South LA - Hawthorne - Torrence - Inglewood

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Targeting South LA and surrounding communities as far south as Long Beach for first 2-4 unit BRRRR deal.

I fully understand that many experienced investors will say they simply don't buy multi-family deals in Southern California and instead look toward Phoenix, Las Vegas and Texas (at least for markets in the southwest.)  But this argument seems to be specific to commercial apartment buildings.

I live in LA and would rather find my deal here if the numbers make sense. There is still a considerable housing shortage in LA. (And I don't feel ready yet to take on a rehab out of state, as I'm building my team here in LA)

MY QUESTION - Taking into consideration the Crenshaw/LAX Metro line opening in 2020 (which drastically changing the Crenshaw corridor all the down through Inglewood to LAX) as well as the LA Rams stadium opening in 2020, along with the renting housing shortage in Los Angeles :

Do you like Hawthorne, Torrance, Southgate, Inglewood, Long Beach markets?

Have you done any deals in these areas in the last 6-12 that you really like?

 

Experience Los Angeles investor say don’t buy multi-family deal in Southern California, but buy multi-family in Las Vegas??  Then those experience LA investor are only half right and half wrong, and those investor are only experience in LA, but don’t have enough experience in Las Vegas.  The truth about the multi-family in Las Vegas, most of the 4-plex are trash in class C-/D Area.  As an experience Las Vegas Investor, I would absolutely NOT to buy any 4-plex or multi-family in Las Vegas.  

Good luck to those experience LA investor buying trash 4-plex in Las Vegas. 

@Andrew Oliveri  I think this question might be better in the California forum.  Bigger Pockets has some good state specific forums and you'll get a few more locals to weigh in there rather than some dude down in Texas.  Just a thought.  Thanks!

@Andrew Oliveri

Those communities are outside of Los Angeles city RSO rules so that's a good start. Inglewood has the most liberal ADU regulations so if you buy a SFR, with enough land you can build a generously sized ADU that would essentially turn your SFR into a duplex. MF anywhere is so expensive you should be OK with little to negative ROI. I like Long Beach which is still somewhat affordable and offers amenities but be careful about the location. Southgate is good for MF and somewhat overlooked by most investors. Hawthorne is still very C- to D so you would trade cash flow for turnover. Just be sure the property is in Hawthorne proper and not Los Angeles or you run into the most draconian rent control laws in the land. Inglewood is already priced with the Crenshaw line and stadium but once the line actually starts running there may be another spike up. Torrance is so expensive. I don't see making any decent ROI. What makes Torrance attractive to tenants are the schools si of the price looks really good its probable not in the Torrance school district. My bet is on Southgate and Long Beach or Inglewood if you can swing the price.

@Coco Cook I would disagree with Hawthorne being C-/D.  It's well positioned and the worst areas in Hawthorne are a C at the worst.  Hawthorne is well positioned near Inglewood and has market pressure from tech companies like Spacex moving in.  Ring is moving from Santa Monica to Hawthorne and you see places like Eureka Burger and Base51 (https://www.yelp.com/biz/base51-hawthorne-3) popping up to cater to the demographic.  

Originally posted by @Andrew Oliveri :

Targeting South LA and surrounding communities as far south as Long Beach for first 2-4 unit BRRRR deal.

I fully understand that many experienced investors will say they simply don't buy multi-family deals in Southern California and instead look toward Phoenix, Las Vegas and Texas (at least for markets in the southwest.)  But this argument seems to be specific to commercial apartment buildings.

I live in LA and would rather find my deal here if the numbers make sense. There is still a considerable housing shortage in LA. (And I don't feel ready yet to take on a rehab out of state, as I'm building my team here in LA)

MY QUESTION - Taking into consideration the Crenshaw/LAX Metro line opening in 2020 (which drastically changing the Crenshaw corridor all the down through Inglewood to LAX) as well as the LA Rams stadium opening in 2020, along with the renting housing shortage in Los Angeles :

Do you like Hawthorne, Torrance, Southgate, Inglewood, Long Beach markets?

Have you done any deals in these areas in the last 6-12 that you really like?

 

Hi Andrew,

To me those cities are drastically different, and Long Beach has drastically different sub-markets.

It might help to pick either an (A), (B),(C) or (D) neighborhood within each city, and then you can compare Apples to Apples.

You might find some OWC's in those areas too.

Just my 2 cents.

 

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