How to Buy Rental Property in San Diego
How To Pick The Ideal Rental Property Investment “The Sweet Spot”
If you’re looking to buy an investment rental property, it pays to keep in mind who you’re trying to attract as a tenant. If you buy rental property at the bottom of the price point for a given area, you will most likely not be in the best school districts, and will attract a marginal tenant who will have trouble paying the rent and keeping up with the maintenance of the house.
If you buy rental property in too rich of an area, the rent must be high and you will find fewer people able to afford the rent. Also, people who can pay that high rent are really buyers, not renters, they’re just waiting for the right opportunity, and they’ll leave you with a vacancy.
The best place, what I call the “sweet spot” is the middle of the road. At that price point you’ll have plenty of applicants to choose from, and you’ll have quality renters who will appreciate and take care of your house. In addition, they like being renters, and will stay a good long time.
Where is the sweet spot? It varies for each area. It’s different in Carlsbad than in Oceanside. Basically it’s as low in price as you can go without getting into the areas where families don’t want to live.
|Too old and small||Too big and expensive||Just right|
Sometimes people who are buying their first rental property tell me they don’t care where the house is, they just want “a good deal”. I say that a good rental is better than a good deal. You might find a house that’s a good deal, but it will only rent to tenants who will be a constant problem for you. Believe me, tenant nightmares will erase any joy you have over finding a good deal very quickly. Better to buy a house that will rent to a carefree tenant.
So if you’re thinking about getting that first real estate investment, give me a call and I’d be happy to help you. My wife and I are active investors, and would love to give you the benefit of our experience.