General Cap Rate in SoCal Market
Hi everyone,
I am a new investor in Los Angeles, California. I have been studying and analyzing deals since May last year, and I am about to wrap a duplex in Whittier. As a starter, my strategy is to acquire multifamily properties, fix it, rent it out 5-7 years, and resell it. I assume that's the famous "brrr"?
From what I've heard, California is a tough market to practice such strategy compare to other states. Almost all the properties that I analyzed give me <5% cap rate. While keep hearing others setting their minimum investing cap rate standard at double digits (non-CA perhaps) or much higher than 5%, it makes me wonder: is it really the norm to have lower cap rate in California? Or Is there an error during my number crunching? Perhaps I need to revise my strategy...
Any input is welcome. Thanks :)