All Forum Posts by: Becca F.

@Madhan S.

You have the portfolio I dream of with many single family homes in California. I have a small portfolio including one multi-unit (apartment complex) in the Bay Area. I'm keeping my CA properties to pass onto my kids. 

You don't mention specifics such as your rental income vs. mortgage payments or prices your purchased these properties at. If you started 15 years ago, so around 2010 that was a good time to buy. And your property taxes are likely still reasonable with the 2% max increase a year from Prop. 13. In many other states the property taxes go up significantly, especially for investors. 

In reality there is no high cashflow on traditional long term rentals anywhere in 2025. Anyone who is telling you this for single family is trying to sell you something, putting 40% down, paying cash (now locking up large amounts of money) or doing STRs or other riskier strategy. 

I also invest OOS in Indianapolis metro area. I also lived in Indiana and rented out my Class A (nice suburb, great schools) home when I moved back to CA but I bought it in 2013 and have a low interest rate. Home has doubled in value in 10 years (not bad for Midwest) and I'm cash flowing  but my property taxes go up significantly each year. Insurance costs are reasonable. I bought 2 Class C homes in 2023 "cash flow on paper" (sold one of them recently to cut my losses). I'm -$300 to -$500 a month with repairs called in by tenant most months. It might be stabilizing now after 2 years. 

I'm assuming your properties are in nice areas of San Diego or SoCal? I can't speak to buying multi-family OOS since I don't own any MF properties OOS. You might consider NNN leases - don't have to deal with residential tenants and repairs. This is what CA Investor I know is doing buying commercial in the South and Midwest (fast food, coffee shops, medical office space) and his NNN tenants pay the property tax, insurance and maintenance costs).

I guess if you can work remotely with your high tech CA paying job and move to another state that could work but I personally wouldn't start selling your CA properties off without some well planned strategy. Please don't buy any $50k to $200k Class C properties OOS to try to "cash flow". It will be eaten up in repairs, capital expenses or tenant issues. I've talked to many CA investors losing money buying cheap properties.

Thoughts on this @Jay Hinrichs or @Dan H.? Guys sorry for tagging you but this is at least the 6th post I've seen recently from CA investors and this investor already has a nice portfolio built up. 

This is great info with the state by state and metro details! 

I think San Francisco has made a bit of a comeback after people leaving during COVID and with more return to office mandates. And there are some people who love living in the city.  I'm a little surprised that San Jose had slight declines. 

Thanks for sharing!

 I don't know anything about the NY or NJ market. The only thing I've heard is that upstate NY properties would cost less than NYC area. 

Your post mentioned "high cash flowing areas". I agree with Nicholas' comments about not cash flowing the first few years. This is especially true now in 2025 market vs. 2012-2018

Here are some general strategies that California investors I know are using (which may or may not work where you're looking and you'll need to factor in NY/NJ local rental laws)

- To lessen negative cash flow (not eliminate it): mid-term or short term rentals. This depends on the market. STRs are oversaturated in many cities. This is more labor intensive than a traditional long term rental and you need to furnish it and pay for utilities and WiFi/internet. 

- Rent by the room (called co-living by some): will usually get more rent than renting to an individual/couple/family but tenant dynamics (roommate situations) could be challenging

- Buy a property with an ADU (accessory dwelling unit). This seems to be more popular on the West Coast. Or add that onto your primary residence property and rent it out or live in the ADU yourself and rent out the main house. Construction costs could be high.

- Buying new build. The builder will often offer a lower interest rate. Research who's a good vs. average vs. terrible builder in your area. 

I'd recommend that you attend local meetups. You can talk to NY investors who buy in-state and out of state. You'll get different perspectives from those of us that don't even live in NY/NJ and are commenting on your post. Some of them may even let you walk their projects. Good luck. 

**Zoom calls... typing fast so forgive my typos

@Alexander C.

Btw I'm not an agent and don't work in the real estate industry. I don't receive any type of compensation, not even $1 if I refer you to an agent, contractor or other RE industry person

Just be careful and there's money to be made and not everyone has your best interests at heart. If you skim the BP posts you'll see a pattern. "California investor" are the magic words to be contacted by numerous people. Warning: don't partner with anyone you don't know well or lend any money (transactional lender or private lender) to anyone that contacts you on BP 

It's hard to quantify. Out of 10 investors that I directly talked to 8 out 10 had difficulties of some degree, some of them just bought maybe 6 months ago so we'll see what unfolds. Three had terrible stories (one was in St. Louis). Difficulties with Property Managers charging high fees, not sending invoice of repairs to investor (to me a red flag - it's her property not the PMs), high trip fees for repairs, not communicating with investors. 

Examples: 1) St. Louis story with 2 apartment complexes in gentrifying areas (what the agent told her): tenants had constant wear and tear on apartment units, many of them Section 8, she changed PMs and still didn't help, tenants had conflicts with other tenants, tenants tried to sue her, etc.  Investor sold after 3 years of trying of hoping it would improve 2) another Indiana one not in Indy but nearby county  - dishonest PM never checked on property or tenant, tenant vandalized property and stole appliances and water heater after being served eviction notice 3) Not really a horror story but investor sold 5 Indy properties, kept one for now, too much maintenance and high turnover. A few of the homes were operated as STRs. 

I've been on numerous Zoom class with other CA investors and meet ups. I'm not singling out Indy so here are other cities/states they had problems with: St. Louis (mentioned above), Columbus, Cleveland, Philadelphia, Alabama (Huntsville I think). Others mentioned problems generally with Class C out of state but didn't name specific cities. I think we see a pattern here. 

I think there is a risk with buying properties from a distance - the risk each investor wants to take is very individual. Also some investors have good performing properties balanced with properties with lots of problems so maybe it balances out. For what it's worth, I wouldn't buy Class C in California either. 

@Chaim Mal

I agree with Nicholas' and Daniela's comments. From her comment it sounds like you're on the East Coast near NJ/NY area. 

I talk to a lot of California investors and it's a huge gamble to buy out of state especially a market you don't know well. Many of us have lost money on "cash flow on paper" properties, specifically Class C. 

If I were you I would try to stay local or at least a 2 to 3 hour drive (if that's do-able for you). Good luck. 

@Vanessa Li

I talked to a couple of Bay Area investors recently - they bought new build in Utah, two of them. One bought for $499,000, will ask the other investor but I think her price purchase price is higher since she's do rent by the room (called co-living) so larger home. Another investor bought in Texas, new build. 

I think they're going for appreciation and a higher quality property after hearing all the stories of CA investors buying inexpensive properties, specifically Class C in the Midwest/Southeast and losing money. (Ex: CA investor I talked with bought 2 apartment complexes in St. Louis area, both Class C, was told it was in a gentrifying area. After trying to fix problems with new property manager, there was still constant tenant issues even conflicts among tenants, some of them were Section 8 creating lots of wear and tear from being home all day, tenant threatening to sue her, etc. She sold the both buildings after 3 years). I'm not saying all Section 8 is bad but I wouldn't go that route for the "cash flow".  This is worse than my story. 

The upside is with new build you put off some of the capital expenses for a while but you have to make sure it's a good builder. Would definitely have a local point person walk the property during the stages of the build and take video if you can't visit frequently (pay them for their time).

I would attend local meet ups in the Bay Area, Sacramento, LA area, or San Diego (still not sure what part of CA you're in). I think you will get much better perspective from having conversations from people in real life than all of us posting comments to you, which is very one dimensional. I go to meet ups frequently and am constantly learning. 

 That's what one California investor who moved to Vegas told me. The schools aren't as good as the Bay Area, where we have nationally ranked schools in highly desirable suburbs and one specific high school in San Francisco (kids get in based on grades and standardized test scores in middle school). For me a highly ranked school district wouldn't be my #1 criteria for Vegas (still important). My plan would be to eventually move into the rental home as my primary residence down the line when I decide to retire (the no state income tax in Nevada is big part of my decision if I move out of CA). 

 What?! Are you serious? I wouldn't say I was scammed (the legal definition) but I was taken advantage of. 

I've heard several stories from other California investors. Is this an Indy curse or something? 

I'm not trying to attack Indy - it could happen in other cities in the Midwest or Southeast. 

@Alexander C.

If you don't already own a primary residence is it possible to house hack? The East Bay is less than the Peninsula. 

I invest in the Bay Area and Indianapolis metro area. For context I did live in Indiana so I didn't pick a random market 2000 miles away. I rented out my Indy home (Class A nice suburb with great schools) when I moved back to California - I bought it in 2013 so different market back then. I've posted about this many times so I'll spare you my essay about Class C. 

- Talk to local investors, someone unbiased, not an agent, wholesaler or anyone trying to sell you something.

- Get in touch with property management companies and ask about tenant base and median rents in different neighborhoods

- I wouldn't buy any sub $200k Class C property. Any cash flow on paper will be eaten up. I've talked to numerous California investors who bought cheap properties OOS and lost money (myself included). I think it's a gamble, could do well but could do terribly. 

- Don't buy sight unseen. Fly to the market you're considering multiple times. 

- Get a sewer line scope and full inspection (go with an inspector recommended by other trusted investors. 

- Location, location, location

Feel free to DM if you'd like to ask further questions :)