Chino, CA · Member since 2018 · 11 posts · 7 votes
Looking into investing in Lake Elsinore or Moreno Valley in CA. When doing some research, I see that Lake Elsinore has high Mello Roos but appears to have some up and coming neighborhoods. Moreno Valley has some nicer areas I‘d plan to stick too. I‘m from Los Angeles and looking for some insight to investing in the Inland Empire.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Angela Hill I personally would try to avoid high special assessments on property taxes, they will eat profit for breakfast. Moreno Valley is also closer to the job centers of Riverside, and San Bernardino than Elsinore is. Be aware there are areas of Moreno Valley that have the high special assessments as well
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Angela Hill mello roos is typically only in the newer neighborhoods both cities have nice areas and both have their sketchier areas, not really sure what type of insight you are looking for though.
Chino, CA · Member since 2018 · 11 posts · 7 votes
7y
I’m looking to buy and hold. I’ve viewed homes in both areas and have found some nice turnkey homes to rent out. The cash flow is minimal but I’m just looking to get started in investing in an A/B area I can afford in Southern California. I’m looking for any insight as to whether buy and hold is smart in high Mello Roos area (Lake Elsinore) where I like the homes more or go with an area that’s my second choice (Moreno Valley) with no Mello Roos. Both are in Riverside County where property tax is somewhat high too. Thanks!
Mustang, OK · Member since 2018 · 154 posts · 110 votes
7y
I agree with @KJ L. that you need to identify what type of investing you'd like to do in either or both of those cities.
I have been to both of these cities and found approximately 15 properties that have been contacted that I would like to get under contract, to wholesale.
My objective is to wholesale first and build up some capital reserves, then eventually to buy a SFR to fix and flip. Wholesale 3-4 properties, then buy 1 to fix and flip, Wholesale 3-4, then fix and flip. Then buy a multifamily property and hold that joker for 5-10 years minimum and consider the option to sell and 1031 to a larger multifamily property, while still wholesaling, fix and flipping and buying rentals.
Choosing the city to invest in is great, but you also need to identify what & how you want to invest in those cities too.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Angela Hill I personally would try to avoid high special assessments on property taxes, they will eat profit for breakfast. Moreno Valley is also closer to the job centers of Riverside, and San Bernardino than Elsinore is. Be aware there are areas of Moreno Valley that have the high special assessments as well
Chino, CA · Member since 2018 · 11 posts · 7 votes
7y
Thanks Aaron! I was looking for that kind of insight from someone who knows something about these areas in the inland empire! I like hearing that Moreno Valley is closer to jobs in Riverside and San Bernardino and I will inquire about the special assessments. I’m looking in the 92555 or 92551, near Rancho Belago.
Real Estate Professional · CA · Member since 2011 · 22 posts · 12 votes
7y
Good advice here... and I think the great thing about real estate is you invest based on your goals. Soo if you don't mind a low cash flowing property it's up to you. Run the numbers including the higher taxes until your comfortable. That area of the 215fwy is booming with logistics centers warehouses.
Mustang, OK · Member since 2018 · 154 posts · 110 votes
7y
@Angela Hill Just a thought here that if you were to consider investing in Moreno Valley UC Riverside is nearby, so either SFRs or small apartment complexes would be good opportunities to consider investing.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Angela Hill those are good zips but are also a bit more likely to have special assessments if working with a realtor have them check property taxes on each property before you go anything before 2000 and you are probably clear though. You might also look in the NW part of 92557 up against the mountain the homes were built in the late 80s so no special assessments but they are very nice and close to the jobs.
@Kurt Michaelson most UCR students would not rent small apartment complexes in Moreno Valley due to the fact that they can be in rougher areas than the ones in Riverside that are only slightly higher priced. They will go for some of those larger homes in Box Springs though
Investor · Riverside, CA · Member since 2016 · 129 posts · 67 votes
7y
@Angela Hill I would suggest to you that anything on the retail front, including multifamily, is going to be tough to pencil. Perhaps @Aaron K. can chime in but I personally try to avoid most retail/MLS activity. The Inland Empire is not an untapped market when it comes to investors - buy and hold or flips. The entry point may be cheaper than coastal communities but there is a ton of activity already happening here. Also, be careful when folks try to pitch you some of the more distant inland communities because while they may sound attractive with retail pricing, they aren't necessarily the best locations and will feel the pinch first in a softening market. Networking with investors is the way to go and establishing relationships with wholesalers is key. It takes a lot of work and staying involved.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Rob Moran@Angela Hill retail can work, but don't expect miracles from it. Based on Angela's post this sounds like it may be a first investment purchase, in which case retail offers a few more security blankets like a realtor to walk you through the process, thorough inspection from an inspector, etc. Also if this isn't an ongoing search and you just want to purchase a single property and see how it goes it is tough to find something off market cost effectively because most people who do off market are spending on advertising, and many of the wholesalers don't offer the A class neighborhoods in turnkey condition that I think you've been looking at. However a lower price than the coast isn't everything have the realtor run rental comps so that you don't think something will rent for more than it will. In Mo Val or Elsinore the max is probably about $2k/ month in a really nice post 2000 build with 2,500+ sqft
Investor · Riverside, CA · Member since 2016 · 129 posts · 67 votes
7y
@Aaron K.@Angela Hill I certainly understand your points but my feeling is that to find something that has any cash flow at all, you won't find it retail, just my 2 cents. Of course, we don't know what kind of financing @Angela Hill will be using but with interest rates creeping up, and it's higher for investment properties, I don't like the math.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Rob Moran for cash flow (at least anything significant) with most traditional down payments I agree with you, however from what she's mentioned about Mello Roos I think she has been looking at nicer properties that wouldn't cash flow anyways. Some people are content to just take the principal paydown and appreciation I guess. That can turn into a house of cards if multiple properties are purchased and they are all financed so it is only "workable" on a small scale but it works for some
Chino, CA · Member since 2018 · 11 posts · 7 votes
7y
Thanks everyone for all this great information!
@Aaron K. @Rob Moran I'm looking to get started and get my first property under my belt. I want to stick to turnkey in a nice neighborhood.
Question - When I look up rent rates in MV, I see 4-5 bedroom/2500+ sqft homes go for $2100-$2400. Is that not what you find? I think Aaron you said you are in Property Management, is that assumption too high?
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
7y
@Angela Hill it depends on the area, that is definitely on the high end of rents for the area though, I am not a property manager but those will likely be in very large homes (2500+ sqft) that are post recession builds. If you give me some specs I may be able to formulate a better estimate.
Investor · Riverside, CA · Member since 2016 · 129 posts · 67 votes
7y
@Angela Hill Are you financing conventionally with 20% down? If this is a retail deal out in that part of town, I don't see how that pencils, but I don't know the exact sales price. I agree with @Aaron K. on rents.
Hi Angela, Lake Elsinore was definitely the best place to buy about 2 yrs ago, now prices are inflated. People are moving from here to Moreno Valley, so a purchase at the moment may be better suited there. However if the market drops, a property in LE is a far better choice. Very up and coming.
Angela, If you'd like to share the neighborhood I can let you know my opinion about the environment and growth, I was born and raised in Lake Elsinore. However I feel there are not a lot of smart investments at the moment, the prices have been inflated for a year and are dropping. Flipping would have been ideal about 8 mos ago.