[Ren]

The only people I know who had a bad experience with either condo or SFR investment properties had that experience because they made a series of bad decisions – they didn’t do the math and paid too much, they bought in an area that was flooded with rentals or has no employment prospects, they got greedy and took an extra $100/month rather than get a quality tenant, or all of the above and more. I have three friends with houses in AZ, one with the greed issue, two without. Ask the greedy one what she thinks of rental property, and she’ll tell you her horror stories of constant evictions and damage and how it’s a terrible investment, completely oblivious to the real issue. One of the others has become fairly wealthy doing it with SFRs.

Even the skeptics in my life admit the same thing – the people they know personally who own investment property (usually their first home, now a rental) are generally better off because of it.

The only way a property will become a liability is if the costs increase at a higher rate than the revenue, which doesn’t happen the vast majority of the time thanks to inflation, unless you have a perfect storm of personal financial disaster and urban decay. In fact, properties that are a liability now will eventually become income-producing assets, as long as the owner doesn’t do something stupid, like pull cash out for a motorhome.

I have a relative who owns a house outright in Wallace, Idaho (population 900 or something like that). It’s ridiculously cold most of the year and there is virtually no employment, but she prices it right, so even with a 93-year-old house, she has a steady stream of positive cash flow and more than covers the maintenance.

[Ren]

The only people I know who had a bad experience with either condo or SFR investment properties had that experience because they made a series of bad decisions – they didn’t do the math and paid too much, they bought in an area that was flooded with rentals or has no employment prospects, they got greedy and took an extra $100/month rather than get a quality tenant, or all of the above and more. I have three friends with houses in AZ, one with the greed issue, two without. Ask the greedy one what she thinks of rental property, and she’ll tell you her horror stories of constant evictions and damage and how it’s a terrible investment, completely oblivious to the real issue. One of the others has become fairly wealthy doing it with SFRs.

Even the skeptics in my life admit the same thing – the people they know personally who own investment property (usually their first home, now a rental) are generally better off because of it.

The only way a property will become a liability is if the costs increase at a higher rate than the revenue, which doesn’t happen the vast majority of the time thanks to inflation, unless you have a perfect storm of personal financial disaster and urban decay. In fact, properties that are a liability now will eventually become income-producing assets, as long as the owner doesn’t do something stupid, like pull cash out for a motorhome.

I have a relative who owns a house outright in Wallace, Idaho (population 900 or something like that). It’s ridiculously cold most of the year and there is virtually no employment, but she prices it right, so even with a 93-year-old house, she has a steady stream of positive cash flow and more than covers the maintenance.

[Ren]

The only people I know who had a bad experience with either condo or SFR investment properties had that experience because they made a series of bad decisions – they didn’t do the math and paid too much, they bought in an area that was flooded with rentals or has no employment prospects, they got greedy and took an extra $100/month rather than get a quality tenant, or all of the above and more. I have three friends with houses in AZ, one with the greed issue, two without. Ask the greedy one what she thinks of rental property, and she’ll tell you her horror stories of constant evictions and damage and how it’s a terrible investment, completely oblivious to the real issue. One of the others has become fairly wealthy doing it with SFRs.

Even the skeptics in my life admit the same thing – the people they know personally who own investment property (usually their first home, now a rental) are generally better off because of it.

The only way a property will become a liability is if the costs increase at a higher rate than the revenue, which doesn’t happen the vast majority of the time thanks to inflation, unless you have a perfect storm of personal financial disaster and urban decay. In fact, properties that are a liability now will eventually become income-producing assets, as long as the owner doesn’t do something stupid, like pull cash out for a motorhome.

I have a relative who owns a house outright in Wallace, Idaho (population 900 or something like that). It’s ridiculously cold most of the year and there is virtually no employment, but she prices it right, so even with a 93-year-old house, she has a steady stream of positive cash flow and more than covers the maintenance.

[Ren]

The only people I know who had a bad experience with either condo or SFR investment properties had that experience because they made a series of bad decisions – they didn’t do the math and paid too much, they bought in an area that was flooded with rentals or has no employment prospects, they got greedy and took an extra $100/month rather than get a quality tenant, or all of the above and more. I have three friends with houses in AZ, one with the greed issue, two without. Ask the greedy one what she thinks of rental property, and she’ll tell you her horror stories of constant evictions and damage and how it’s a terrible investment, completely oblivious to the real issue. One of the others has become fairly wealthy doing it with SFRs.

Even the skeptics in my life admit the same thing – the people they know personally who own investment property (usually their first home, now a rental) are generally better off because of it.

The only way a property will become a liability is if the costs increase at a higher rate than the revenue, which doesn’t happen the vast majority of the time thanks to inflation, unless you have a perfect storm of personal financial disaster and urban decay. In fact, properties that are a liability now will eventually become income-producing assets, as long as the owner doesn’t do something stupid, like pull cash out for a motorhome.

I have a relative who owns a house outright in Wallace, Idaho (population 900 or something like that). It’s ridiculously cold most of the year and there is virtually no employment, but she prices it right, so even with a 93-year-old house, she has a steady stream of positive cash flow and more than covers the maintenance.

[Ren]

The only people I know who had a bad experience with either condo or SFR investment properties had that experience because they made a series of bad decisions – they didn’t do the math and paid too much, they bought in an area that was flooded with rentals or has no employment prospects, they got greedy and took an extra $100/month rather than get a quality tenant, or all of the above and more. I have three friends with houses in AZ, one with the greed issue, two without. Ask the greedy one what she thinks of rental property, and she’ll tell you her horror stories of constant evictions and damage and how it’s a terrible investment, completely oblivious to the real issue. One of the others has become fairly wealthy doing it with SFRs.

Even the skeptics in my life admit the same thing – the people they know personally who own investment property (usually their first home, now a rental) are generally better off because of it.

The only way a property will become a liability is if the costs increase at a higher rate than the revenue, which doesn’t happen the vast majority of the time thanks to inflation, unless you have a perfect storm of personal financial disaster and urban decay. In fact, properties that are a liability now will eventually become income-producing assets, as long as the owner doesn’t do something stupid, like pull cash out for a motorhome.

I have a relative who owns a house outright in Wallace, Idaho (population 900 or something like that). It’s ridiculously cold most of the year and there is virtually no employment, but she prices it right, so even with a 93-year-old house, she has a steady stream of positive cash flow and more than covers the maintenance.

[Ren]

[quote=ctr70]3. I do worry about the effect of gas prices on rents and values especially in the far flung regions of Riverside Co. Esp if they get up to $5-$6 a gallon. This fear favors buying close in SD condos.[/quote]

I wouldn’t worry about the price of gas. Your Temecula tenants will probably work locally, because taking gas into account, Temecula rents are actually comparable to north county inland. People who do commute to San Diego can easily afford to buy in Temecula, because it’s not like they’re commuting an hour to a $10/hour job.

[quote]What do investors think of condos in San Diego vs. SFR’s in Riverside Co.? Obviously San Diego is a much better rental market and more premium location than Riverside Co., but SFR’s are a more desirable asset b/c NO HOA risks. The cash flow numbers work for a lot of condos in SD County, and in good locations. The numbers do not work great for SFR’s in SD, even SFR’s in rougher neighs.

Personally I would only go SFR’s in Riverside. If I’m going to buy a condo I would go SD over Riverside in a heartbeat.[/quote]

In general, Temecula condos cash flow as well or better than anything in San Diego, and you’ll get a much newer condo in Temecula compared to one with similar cash flow in San Diego. HOAs in Riverside county also tend to be much more reasonable (there’s no excuse for a $300-$400 HOA with exactly the same coverage and amenities you can get for $200 HOA in Temecula). The only investments I’m considering at this point are Temecula and San Marcos condos and Temecula SFRs. The SFRs don’t cash flow as well as the condos, but it’s a good idea to have both. Don’t forget to add in the SFR maintenance items that are covered with condo HOAs – like decades of yard maintenance, exterior paint, fencing, a new roof or two, etc.

[quote]Any thoughts on Vegas and Phoenix? I know both are hurting bad. But like Riverside Co. you can buy way below construction costs and get new built SFR’s that cash flow. Yes I know there are crappy areas in both cities, but if you are careful you can pick the better areas. I hear they do rent up if you are very, very careful on neighborhood selection.[/quote]

You have to know the area extremely well or have an agent you trust. Just search Craigslist for rentals in those cities and you’ll see how saturated the market is. As attractive as the prices are, they should also scare you a little – if someone can’t qualify for a $300 mortgage, do you really want them as a tenant?

[quote]My personal goal is to get 6-10 houses paid off in 15 years as my personal pension plan. I have the down payments and can get 8 more conventional loans (I have 2 rentals already). I’m 40 yrs old right now. My plan is 20%-25% down on each and get them paid off in 15 years. Just need to choose where and what to buy!![/quote]

Similar to my own goals, except I’m not eager to get them paid off so quickly. You also may not be able to get 20% financing on investment properties, depending on the lender and your income/assets. I was told flat out “no way” to that by several banks, even though we easily qualify otherwise. I’m planning on 30%.

[Ren]

[quote=ctr70]3. I do worry about the effect of gas prices on rents and values especially in the far flung regions of Riverside Co. Esp if they get up to $5-$6 a gallon. This fear favors buying close in SD condos.[/quote]

I wouldn’t worry about the price of gas. Your Temecula tenants will probably work locally, because taking gas into account, Temecula rents are actually comparable to north county inland. People who do commute to San Diego can easily afford to buy in Temecula, because it’s not like they’re commuting an hour to a $10/hour job.

[quote]What do investors think of condos in San Diego vs. SFR’s in Riverside Co.? Obviously San Diego is a much better rental market and more premium location than Riverside Co., but SFR’s are a more desirable asset b/c NO HOA risks. The cash flow numbers work for a lot of condos in SD County, and in good locations. The numbers do not work great for SFR’s in SD, even SFR’s in rougher neighs.

Personally I would only go SFR’s in Riverside. If I’m going to buy a condo I would go SD over Riverside in a heartbeat.[/quote]

In general, Temecula condos cash flow as well or better than anything in San Diego, and you’ll get a much newer condo in Temecula compared to one with similar cash flow in San Diego. HOAs in Riverside county also tend to be much more reasonable (there’s no excuse for a $300-$400 HOA with exactly the same coverage and amenities you can get for $200 HOA in Temecula). The only investments I’m considering at this point are Temecula and San Marcos condos and Temecula SFRs. The SFRs don’t cash flow as well as the condos, but it’s a good idea to have both. Don’t forget to add in the SFR maintenance items that are covered with condo HOAs – like decades of yard maintenance, exterior paint, fencing, a new roof or two, etc.

[quote]Any thoughts on Vegas and Phoenix? I know both are hurting bad. But like Riverside Co. you can buy way below construction costs and get new built SFR’s that cash flow. Yes I know there are crappy areas in both cities, but if you are careful you can pick the better areas. I hear they do rent up if you are very, very careful on neighborhood selection.[/quote]

You have to know the area extremely well or have an agent you trust. Just search Craigslist for rentals in those cities and you’ll see how saturated the market is. As attractive as the prices are, they should also scare you a little – if someone can’t qualify for a $300 mortgage, do you really want them as a tenant?

[quote]My personal goal is to get 6-10 houses paid off in 15 years as my personal pension plan. I have the down payments and can get 8 more conventional loans (I have 2 rentals already). I’m 40 yrs old right now. My plan is 20%-25% down on each and get them paid off in 15 years. Just need to choose where and what to buy!![/quote]

Similar to my own goals, except I’m not eager to get them paid off so quickly. You also may not be able to get 20% financing on investment properties, depending on the lender and your income/assets. I was told flat out “no way” to that by several banks, even though we easily qualify otherwise. I’m planning on 30%.

[Ren]

[quote=ctr70]3. I do worry about the effect of gas prices on rents and values especially in the far flung regions of Riverside Co. Esp if they get up to $5-$6 a gallon. This fear favors buying close in SD condos.[/quote]

I wouldn’t worry about the price of gas. Your Temecula tenants will probably work locally, because taking gas into account, Temecula rents are actually comparable to north county inland. People who do commute to San Diego can easily afford to buy in Temecula, because it’s not like they’re commuting an hour to a $10/hour job.

[quote]What do investors think of condos in San Diego vs. SFR’s in Riverside Co.? Obviously San Diego is a much better rental market and more premium location than Riverside Co., but SFR’s are a more desirable asset b/c NO HOA risks. The cash flow numbers work for a lot of condos in SD County, and in good locations. The numbers do not work great for SFR’s in SD, even SFR’s in rougher neighs.

Personally I would only go SFR’s in Riverside. If I’m going to buy a condo I would go SD over Riverside in a heartbeat.[/quote]

In general, Temecula condos cash flow as well or better than anything in San Diego, and you’ll get a much newer condo in Temecula compared to one with similar cash flow in San Diego. HOAs in Riverside county also tend to be much more reasonable (there’s no excuse for a $300-$400 HOA with exactly the same coverage and amenities you can get for $200 HOA in Temecula). The only investments I’m considering at this point are Temecula and San Marcos condos and Temecula SFRs. The SFRs don’t cash flow as well as the condos, but it’s a good idea to have both. Don’t forget to add in the SFR maintenance items that are covered with condo HOAs – like decades of yard maintenance, exterior paint, fencing, a new roof or two, etc.

[quote]Any thoughts on Vegas and Phoenix? I know both are hurting bad. But like Riverside Co. you can buy way below construction costs and get new built SFR’s that cash flow. Yes I know there are crappy areas in both cities, but if you are careful you can pick the better areas. I hear they do rent up if you are very, very careful on neighborhood selection.[/quote]

You have to know the area extremely well or have an agent you trust. Just search Craigslist for rentals in those cities and you’ll see how saturated the market is. As attractive as the prices are, they should also scare you a little – if someone can’t qualify for a $300 mortgage, do you really want them as a tenant?

[quote]My personal goal is to get 6-10 houses paid off in 15 years as my personal pension plan. I have the down payments and can get 8 more conventional loans (I have 2 rentals already). I’m 40 yrs old right now. My plan is 20%-25% down on each and get them paid off in 15 years. Just need to choose where and what to buy!![/quote]

Similar to my own goals, except I’m not eager to get them paid off so quickly. You also may not be able to get 20% financing on investment properties, depending on the lender and your income/assets. I was told flat out “no way” to that by several banks, even though we easily qualify otherwise. I’m planning on 30%.

[Ren]

[quote=ctr70]3. I do worry about the effect of gas prices on rents and values especially in the far flung regions of Riverside Co. Esp if they get up to $5-$6 a gallon. This fear favors buying close in SD condos.[/quote]

I wouldn’t worry about the price of gas. Your Temecula tenants will probably work locally, because taking gas into account, Temecula rents are actually comparable to north county inland. People who do commute to San Diego can easily afford to buy in Temecula, because it’s not like they’re commuting an hour to a $10/hour job.

[quote]What do investors think of condos in San Diego vs. SFR’s in Riverside Co.? Obviously San Diego is a much better rental market and more premium location than Riverside Co., but SFR’s are a more desirable asset b/c NO HOA risks. The cash flow numbers work for a lot of condos in SD County, and in good locations. The numbers do not work great for SFR’s in SD, even SFR’s in rougher neighs.

Personally I would only go SFR’s in Riverside. If I’m going to buy a condo I would go SD over Riverside in a heartbeat.[/quote]

In general, Temecula condos cash flow as well or better than anything in San Diego, and you’ll get a much newer condo in Temecula compared to one with similar cash flow in San Diego. HOAs in Riverside county also tend to be much more reasonable (there’s no excuse for a $300-$400 HOA with exactly the same coverage and amenities you can get for $200 HOA in Temecula). The only investments I’m considering at this point are Temecula and San Marcos condos and Temecula SFRs. The SFRs don’t cash flow as well as the condos, but it’s a good idea to have both. Don’t forget to add in the SFR maintenance items that are covered with condo HOAs – like decades of yard maintenance, exterior paint, fencing, a new roof or two, etc.

[quote]Any thoughts on Vegas and Phoenix? I know both are hurting bad. But like Riverside Co. you can buy way below construction costs and get new built SFR’s that cash flow. Yes I know there are crappy areas in both cities, but if you are careful you can pick the better areas. I hear they do rent up if you are very, very careful on neighborhood selection.[/quote]

You have to know the area extremely well or have an agent you trust. Just search Craigslist for rentals in those cities and you’ll see how saturated the market is. As attractive as the prices are, they should also scare you a little – if someone can’t qualify for a $300 mortgage, do you really want them as a tenant?

[quote]My personal goal is to get 6-10 houses paid off in 15 years as my personal pension plan. I have the down payments and can get 8 more conventional loans (I have 2 rentals already). I’m 40 yrs old right now. My plan is 20%-25% down on each and get them paid off in 15 years. Just need to choose where and what to buy!![/quote]

Similar to my own goals, except I’m not eager to get them paid off so quickly. You also may not be able to get 20% financing on investment properties, depending on the lender and your income/assets. I was told flat out “no way” to that by several banks, even though we easily qualify otherwise. I’m planning on 30%.

[Ren]

[quote=ctr70]3. I do worry about the effect of gas prices on rents and values especially in the far flung regions of Riverside Co. Esp if they get up to $5-$6 a gallon. This fear favors buying close in SD condos.[/quote]

I wouldn’t worry about the price of gas. Your Temecula tenants will probably work locally, because taking gas into account, Temecula rents are actually comparable to north county inland. People who do commute to San Diego can easily afford to buy in Temecula, because it’s not like they’re commuting an hour to a $10/hour job.

[quote]What do investors think of condos in San Diego vs. SFR’s in Riverside Co.? Obviously San Diego is a much better rental market and more premium location than Riverside Co., but SFR’s are a more desirable asset b/c NO HOA risks. The cash flow numbers work for a lot of condos in SD County, and in good locations. The numbers do not work great for SFR’s in SD, even SFR’s in rougher neighs.

Personally I would only go SFR’s in Riverside. If I’m going to buy a condo I would go SD over Riverside in a heartbeat.[/quote]

In general, Temecula condos cash flow as well or better than anything in San Diego, and you’ll get a much newer condo in Temecula compared to one with similar cash flow in San Diego. HOAs in Riverside county also tend to be much more reasonable (there’s no excuse for a $300-$400 HOA with exactly the same coverage and amenities you can get for $200 HOA in Temecula). The only investments I’m considering at this point are Temecula and San Marcos condos and Temecula SFRs. The SFRs don’t cash flow as well as the condos, but it’s a good idea to have both. Don’t forget to add in the SFR maintenance items that are covered with condo HOAs – like decades of yard maintenance, exterior paint, fencing, a new roof or two, etc.

[quote]Any thoughts on Vegas and Phoenix? I know both are hurting bad. But like Riverside Co. you can buy way below construction costs and get new built SFR’s that cash flow. Yes I know there are crappy areas in both cities, but if you are careful you can pick the better areas. I hear they do rent up if you are very, very careful on neighborhood selection.[/quote]

You have to know the area extremely well or have an agent you trust. Just search Craigslist for rentals in those cities and you’ll see how saturated the market is. As attractive as the prices are, they should also scare you a little – if someone can’t qualify for a $300 mortgage, do you really want them as a tenant?

[quote]My personal goal is to get 6-10 houses paid off in 15 years as my personal pension plan. I have the down payments and can get 8 more conventional loans (I have 2 rentals already). I’m 40 yrs old right now. My plan is 20%-25% down on each and get them paid off in 15 years. Just need to choose where and what to buy!![/quote]

Similar to my own goals, except I’m not eager to get them paid off so quickly. You also may not be able to get 20% financing on investment properties, depending on the lender and your income/assets. I was told flat out “no way” to that by several banks, even though we easily qualify otherwise. I’m planning on 30%.

[Ren]

You shouldn’t count on appreciation at all with rentals. It’s all about cash flow, ease of renting, low maintenance (newer), pricing below market, thoroughly screening tenants, and the best part – letting someone else pay your PITI for 30 years.

For investment property, it will be much easier to find financing with 30% down.

[Ren]

You shouldn’t count on appreciation at all with rentals. It’s all about cash flow, ease of renting, low maintenance (newer), pricing below market, thoroughly screening tenants, and the best part – letting someone else pay your PITI for 30 years.

For investment property, it will be much easier to find financing with 30% down.

[Ren]

You shouldn’t count on appreciation at all with rentals. It’s all about cash flow, ease of renting, low maintenance (newer), pricing below market, thoroughly screening tenants, and the best part – letting someone else pay your PITI for 30 years.

For investment property, it will be much easier to find financing with 30% down.

[Ren]

You shouldn’t count on appreciation at all with rentals. It’s all about cash flow, ease of renting, low maintenance (newer), pricing below market, thoroughly screening tenants, and the best part – letting someone else pay your PITI for 30 years.

For investment property, it will be much easier to find financing with 30% down.

[Ren]

You shouldn’t count on appreciation at all with rentals. It’s all about cash flow, ease of renting, low maintenance (newer), pricing below market, thoroughly screening tenants, and the best part – letting someone else pay your PITI for 30 years.

For investment property, it will be much easier to find financing with 30% down.

[Author]

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