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Advice on buying investment property - best areas for growth and rental?

I am UK based buyer looking to invest in US housing to rent out.  I have a pre approved budget of $300k.  Looking at San Jose and San Diego but open to suggestions for other strong, stable areas with good potential for growth in an area with bouyant rental values.  Rental values would need to be at least $1800/mth.
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February 19 2013 - Evergreen
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Profile picture for gator70
Where I invest: I buy newer SFR for 160K with 10% down payment that rent for $1400 month now, when economy is better $1600 month
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December 31 2013
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Both of those regions will be low ROI or no positive cashflow. Other regions like Texas can be high cash flow but there is more risk. There are regions in California where the risk is lower and the cash flow is higher.
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December 31 2013
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If you are thinking of long term investments, a new and innovative but extremely beneficial investing option is fast becoming popular. [Promotion and website deleted by Zillow moderator. Please see our Good Neighbor Policy for more information.]
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December 31 2013
Have you thought about investing in commercial/industrial real estate?  You should have no problem finding a small single tenant, net leased industrial property within your budget. These properties generally have longer lease terms, lower expenses, and sometimes carry less risk. CAP rates are currently between 5%-7% in the Orange County market. However, It is hard to say if this is right for you without knowing the details of your financial investment objectives. 
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December 18 2013
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I would like to suggest Brentwood area from California  which is stable with good potential for growth. Particularly for long term investment & rented it is safe. The rental value of homes are not high as compare to other area.
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December 17 2013
If you still looking, I would suggest Manhattan. Market here is stable at bad time and increasing at good time. Rental is never a problem since the inflow and outflow of NY... But more cash maybe necessary for the city.
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November 18 2013
some good growth areas I'm seeing are in Temecula valley area, corona/Norco Chino and chino hills.  I know you mentioned San Diego but for $300k you are going to be inland in not the best area so growth wise not the best. The above mentioned areas all support exactly what your looking for.  Houses that are in your price range will be 1800sqf-3000sqf newer built in good neighborhoods.  The rents will be $1800-$2600 depending on where you buy.  I hope this helps
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November 18 2013
Probably way too late with this advice, but for an investment city that is really turning around right now you could look no further than Detroit Michigan.  This city will always have it's detractors (We come from the UK originally and feel it really is no worse than London!  We are now in US Property Portfolio and have real faith in what this city has to offer for the future) but the rental returns available to the shrewd investor speak for themselves.
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October 27 2013
If you are still interested, the Fort Collins (Northern Colorado) market is still very strong. 
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September 22 2013
I think you will have a hard time finding something within a $300k budget in the SF Bay Area...

Good Luck!
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September 22 2013

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September 11 2013
The Bay Area and San Diego and North San Diego Counties all boast rentals of at least $1800.   The rental values are not the problem.   I'm in North San Diego, and love it here... more and more people are moving here, great weather, great sports, etc.    I'd be glad to send you a list of some proprties so you could get a general idea of what you could purchase in your price range, and what the rental values are in those areas.  There are not a lot of homes in the $300K range, and one of the last propreties that was in that range had 28 offers on it!  We have a very agressive market right now.  And since you are so far away, you might also want a property manager for your property.  That is not something I do, but they usually charge about 8 - 10% of the rent, plus any expenses. 
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March 24 2013
There are many great areas out there, many mentioned already.  Each area of the country comes with it's own unique factors of what a strong rental is (cap rate, etc.).  I founded a start up company that offers platform for evaluating these different factors.  Check out my profile for more info. Good luck!
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March 23 2013
The Bay Area promises solid rental income. San Jose has more high paying jobs with cap rate can be 4-6%. The minus side is it has harder and harder to find condo/town homes with your budget. As for single family homes you are now out of luck. Outling cities are more affordable but unemployment, vacancy rate and rents are always lower.

Last year condo/.town homes appreciated 30% in general. This year they are moving up weekly. Young couples have to start somewhere and they do not want to pay rent so you are competing with them,

Cupertino, CA
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February 24 2013
Is there a strong reason you're looking at California?  A lot of the markets there do not produce good cash flows or rates of return (COC, cap rates,etc.).  Property values are quite high relative to the rental income produced by the property.

There are many other markets that can provide you greater cash flow and higher rates of return.  We have properties in 13 such markets, which you can review on our website.

If you want a goof balance of cash flow and future appreciation, then we can recommend several markets for you.

Feel free to contact us anytime.  We work with many international buyers.

[hotlink deleted by Zillow moderator. Please see our Good Neigbhor Policy for posting guidelines]
Norada Real Estate Investments
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February 19 2013
My suggestion is to look in the Desert area.  Palm Springs perhaps.  The second home markets are a great deal right now.  It's a good investment with long-term renters and vacation rentals, and then you always have the property yourself to visit or retire to.  I can refer you to a great RE/MAX agent/friend in that [hotlink deleted by Zillow moderator. Please see our Good Neigbhor Policy for posting guidelines]area.  
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February 19 2013
You will certainly get more for your money in San Diego tha San Jose. For your price point, you are looking at a 1-2 bedroom condo. I typically recommend buying in areas where young people congregate....either near colleges or military bases.

If you are intersted in pursuing San Diego, please give me a call. I've been here 21 years and know the areas extremely well.
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February 19 2013
Having lived in San Diego for many years and now in Silicon Valley, I think you'll find that $300k doesn't buy much in terms of a property that provides good income and appreciation.  Median homes prices IN AREAS WITH GOOD RENTS AND IMPROVING VALUES are closer to the $450k to $600k range.  There are 192 properties on the market in San Jose this morning priced $300k and under, most are condos (seldom good rental investments in this area) and the majority of the rest are in neighborhoods that aren't appreciating.  My suggestion is to research the target areas where you would invest within San Jose or San Diego and then make a decision based upon what's available in those areas that you could afford.  You may find you need to adjust your expectations, though you may get lucky and find a gem in your original price range.
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February 19 2013
South Florida is on fire right now.  Single Family homes in Homeowners Associations 4 bedroom 2.5 baths, 2 car garage, 2000-2400 sqft living space are running $180,000-$220,000.  Good neighborhoods and easy to rent.  $1,800-$2,000 month is typical and Cash on Cash retuns of 8%+
We are in a very hot market with a large number of investors.  Many homes are being bid up over investment grade.

I don't have time to even look at homes.  We make offers on 5-10 properties a day, sight unseen and hope our offer is accepted, then have 7-10 days for inspections.

Message me if you are considering South Florida (Palm Beach County)

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February 19 2013
 
Related Questions
Advice on buying investment property - best areas for growth and rental?
Profile picture for gator70
Latest answer by gator70
December 31 2013 | 19 answers
  • Asked by FuchsiaHyde
  • In Investing
  • February 19 2013
Mortgage Rates
 
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