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Looking to buy an investment property, seeking for an expert in San Francisco

Hi,

I am looking for an investment property to rent out while waiting the house price to soar in San Francisco area.  I am hoping if anyone can give me some pointer on any good investment properties that have high rental return (cost of purchase / net rent income).  I have been looking at South Beach loft, but am not sure if I should look at houses in the more neighborhood area like Noe Valley and Marina.  Please let me know what you think?  

Thanks
  • September 20 2013 - South Beach
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Answers (6)

Lot of reasons, not the least of which they are upside down (short sale potential), negative cash flow, personal problems (divorce, lost job, etc) and property needs work that they can't afford to do. 

Also, if they live in another area that is far away from the property, it can be a hassle for them to manage.  Even property managers can be a headache!

In short, you will find many more investment properties by targeting investors than targeting owner-occupied properties.
  • September 21 2013
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Why would investor want out?
  • September 21 2013
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I'd go inland. Sacramento, Concord, maybe even Stockton.  Prices compared to rent work better there.  You can't buy an $800,000 home and get any kind of cash flow in San Fran.

As for financing, there are LOTS of people who would be more than willing to do seller financing.  A lot of investors bought there 7-8 years ago and want out.
  • September 21 2013
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When you are buying an investment property do not forget about financing. Many people who start investing don't always realize that buying an investment property or secondary home is different financially. Since investment properties are riskier for a lender to finance they require a higher down payment and high rate, so be expecting that. These are just some important things to keep in mind while looking for an investment property.

Well I hope this helps! If you have any other questions or if you would like a loan, feel free to contact me.

Good Luck!
  • September 20 2013
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If you are looking for good returns, I suggest searching for 1-bedroom and smaller 2-bedroom units. Their rate of return tends to be more attractive compared to lager properties or SFH's. Also look for units that are in smaller buildings since they tend to have lower HOA fees. Marina is good, also try Cow Hollow, Mission, Hayes Valley, NOPA, SOMA, and the immediate neighborhoods of SFSU, USF, UCSF and all hospitals. 
  • September 20 2013
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Profile picture for Tony Ngai
Buying into SF is a good investment.  In the Marinas, renters would enjoy the beach environment, while for Noe Valley, they would enjoy walking to the 50+ restaurant establishments on Fillmore.  The Marina is more establish, while Noe Valley is the new trend.

Rent wise it is about the same.  Price appreciation is fairly close.  With one of my clients 2 months ago, there were more bidding on properties in the Noe Valley than the Marinas.  Being in SF, commute will not be an issue.  It will come down to what you prefer and perhaps one day if you do plan to live there.
  • September 20 2013
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