Is now a good time to invest in Merced, CA rentals?

Profile picture for InvestorMark09
I recently read that Merced was the number one most undervalued market in the country. Is now a good time to invest in cash flowing rentals there? I am an experienced investor with cash, and typically look for properties where the monthly rent is 2% of the purchase price. Are these kinds of properties available in Modesto? I also am looking to make contact with a realtor experienced with these kinds of investment properties in Merced...
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January 04 - Modesto
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Answers (3)

Profile picture for Rocky G.H. Hawrysz

2% of the purchase price is a bit aggressive for the Central Valley. Even though the rental market is vibrant, it really hasn't kept up with the additional demand. Also, with this market it is more variable than flat. Rents will depend on location and the condition of the home. As an example a home that's $150,000 may rent for $900 to $1,400 and a home that is $400,000 may rent for $1,800 to $2,200.

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January 04
Profile picture for InvestorMark09
Thanks for the info. 

I am an out of the area investor who is familiar with some markets, but am looking for a local agent to help familiarize me with Merced and help me pick up a few rentals if it looks like a good investment
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January 04
Profile picture for sunnyview
Personally I don't like Merced. The new UC is plus, but will remain underdeveloped for years and the other economic bases seem weak. You probably have better choices for safe returns in NorCal rentals anyway.

I am curious. Are you an out of area investor looking for an agent to advise you or are you already familiar with the local markets?
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January 04
 

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