patrick.net

Why CA when you can buy 5-10 somewhere else that cash flow better?

And are much newer that don't need the repairs.

Permanently high plateau.

Trump's likely to win re-election, so I doubt RE will tank anytime soon.

In 5 years, things are likely to change.

My $.02.

Seriously for the savings you can hire an out of state property manager and still come out ahead. Although CA will still want to tax your out of state earnings.

If you're paying all cash there's probably worse things you can do with your money.

You'll have your hands full already with California Property Taxes and HOA. With those and interest on a mortgage loan, it just doesn't pencil out for me.

Probably some Cool-AId drinkers here will "prove me wrong" with their point of view.

350k all cash with 230 HOA and 2200 pm rent

B.A.C.A.H. says

If you're paying all cash there's probably worse things you can do with your money.

You'll have your hands full already with California Property Taxes and HOA. With those and interest on a mortgage loan, it just doesn't pencil out for me.

Probably some Cool-AId drinkers here will "prove me wrong" with their point of view.

That is 6 nearly new San Antonio houses with ~1250 mortgage, ~1900 rent, 350/year hoa.

Two considerations:
Santa Ana is one of the lowest priced areas in OC, mainly due to crime and demographics (mostly Latino). This makes it the most affordable for lower income families who don’t want to drive an hour or more to get to work. And there are not many alternative options. Neighboring Garden Grove saw RE prices zip up more than 40% from 2014 and it has many of the same issues as SA, just not as extreme, so it was the first to appreciate. Now that GG is up, SA will have pressure to appreciate more, as working class families and singles move in. This may change the demographics a bit as well, which would lead to lower crime rates which would in turn lead to more desirability. And that would lead to a “Compton effect” where the changing demographics opened up a geographically desirable (close to everything) location to non-banger, non-illegal type of working class people who just find it to be affordable.

Second consideration is more cynical: SA is a sanctuary city in a sanctuary state, and a Mecca for FoB illegals. Trump’s second term will doubtlessly be marked by a doubling down on immigration enforcement, which could shrink the local population, driving rents down.
Then again, such actions might have the reverse effect. If SA lost a lot of its illegal population, it would become safer with better schools, and with its geographic location central to everything, it would be a massive BUY. So prices would go up and new, more responsible workers would take the place of the illegals.

All things considered, this is probably a great investment.

Waitup says

350k all cash with 230 HOA and 2200 pm rent

B.A.C.A.H. says

If you're paying all cash there's probably worse things you can do with your money.

You'll have your hands full already with California Property Taxes and HOA. With those and interest on a mortgage loan, it just doesn't pencil out for me.

Probably some Cool-AId drinkers here will "prove me wrong" with their point of view.

I’ve been wrong so often on the real estate market that I won’t comment on that portion. I will note that I see only one building anywhere near those specs and I have no idea how it gets near $2200/mo rent. There’s much nicer places in nicer neighborhoods for that much rent.

I take it back sort of. I see a second place with those specs. Shouldn’t bars on the windows tell you that getting $2k a month rent might be a challenge?

I don't think a recession is likely in 2020 but more likely in 2021 - a few years is a stretch, esp. with the coming election turmoil. That being said, isn't RE better for that anyways? It's possible that there will be no recession in the next few years if MAGA politics continue (i.e. Trump gets re-elected) but then I'd rather put the money in the stock market, If you buy RE all cash and rent it out that's somewhat recession proof I'd say. Different story if you buy for an increase in home prices which will not happen IMO, but as long as you collect rent this seems fine.