Tips for Buying an Investment Property in San Diego 

Photo Credit: Flickr: Mark Moz

 

Buying an investment property is a huge decision, especially in the challenging San Diego housing market. As an exclusive buyer’s agent, I’ve helped many new San Diego real estate investors get their feet wet, and I’ve helped experienced investors grow their real estate portfolios. Here are some of the most important things to know when buying an investment property in San Diego.

When it comes to real estate investments, there are many different strategies to choose from. The best strategy for you will be based on your price range and your long-term plans.

Strategy 1: Flip a House. This is the most difficult, time-intensive, capital-intensive, and riskiest option. You would start by looking for a house that nobody else wants to buy - a house at a great price, but in very bad condition. This can be like finding a needle in a haystack! You would then go through the home, hire contractors to fix everything, remodel the bathrooms and the kitchen, put in all new flooring, etc. to make sure it is move-in ready when it goes back on the market. Ideally, you would then sell it and make a good profit. If you are new to flipping houses, you will also be in competition with a lot of savvy investors who have been doing this for years - they will be your competition.

Strategy 2: Buy and Hold. If you go with this strategy, there are several ways to do it, but at the end of the day, you will be a landlord.

The first option is to use the property as a San Diego vacation rental, rented out on a weekly basis in the summer and on a monthly basis in the winter. Vacation rentals typically only do well consistently when they are very close to the beach/sand/ocean. One perk of owning a vacation rental is that you can use the home yourself when it’s empty (although of course your goal is to keep it rented year-round).

The second option is to turn the property into a long-term rental. This is much easier to deal with than a vacation rental, as you don’t have the constant turnover of renters. You also don’t have to be close to the ocean to have a successful long-term rental. Basically any home or condo will work as a long-term rental, as long as the price and the rental rates make financial sense for you. Sometimes you can even purchase a home with a tenant already living there!

The third option is diversifying your real estate investment with a multi-unit rental (a 2-4 unit property). The idea here is that even if one of your tenants moves out, you still have other renters bringing in money while you fill the vacancy. You can even live in one unit yourself and rent out the others. !

In the “buy and hold” strategy, there are also a couple of different options for managing your property. You can hire a property management company to help find and manage tenants, but they will likely take 6-15 percent of your profits. You can also save the money and manage the rental on your own. The ultimate goal with the “buy and hold” strategy is to make a 5 percent or greater annual return on your investment (ideally after all of your expenses). As an added bonus, you will hopefully see the property value increase over the long term.

Strategy 3: Land or larger multi-unit properties (more than 4 units). While I cannot personally help you with these types of investments, I am happy to refer you to people who can!.

If you think that real estate investment is a good option for you, step one is to figure out your price range and decide which of these strategies best fits your long-term plans and goals. Step two is calling me to discuss my real estate investment services and how Globella Buyers Realty can help you find your first (or next) investment property!

For more tips and tricks for investing in real estate in San Diego, read my article "8 San Diego Real Estate Investing Tactics.

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Justin Gramm is the founder and principal broker of Globella Buyers Realty, your San Diego Exclusive Buyer Brokerage.

Exclusive Buyer Agents do not list homes for sale and never represent sellers. They have no "inventory" to try to sell you. They can represent you in purchasing any home. They are specialists at representing buyers only on the buyers' side of the transaction. Exclusive Buyer Agents work to get buyers the best price and terms when they buy a home.

If you have excellent credit and plan to buy a home or condo in San Diego County within 90 days, contact Justin Gramm to hire an agent on your side of the transaction. More about Justin Gramm on . Call Justin at (858) 437-2662 or E-mail.

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Justin Gramm, Broker
Globella Buyers Realty
Ph: 858.437.2662  -  Fax: 858-228-9801
4315 Corinth Street
San Diego, CA 92115
CA DRE License # 01714813
www.Globella.com

 

VIDEO: Meet Justin |  Agency 101 |  Buying a Home in 2017 |  About Globella |  3 Investing Strategies |  Buying a Home in 2016 |  What is an EBA? |  Agent Ethics |  About Justin Gramm |  The Dual Agent Trap |  Hot vs. Cold Market |  Top 1% of Realtors |  Accredited Agent (ABR) |  Relocating to San Diego |  Negotiation Expert |  10 Best School Districts |  Second Home Expert |  When to Buy? Part 1 |  When to Buy? Part 2 |  Testimonials/Reviews |  How I Work |  Buyer Agent Interview |  How I Get Paid |  Preapproval Questions |  Buyer's To-Do List |  Code of Ethics |  Who Wants to be Sold? |  Buying a New Home |  First-Time Homebuyers |  About Buyer Agency |  About the Name |  Buying Short Sales |  Privacy Policy |  Buying Foreclosures |  Buying a Condo |  San Diego Photos |  Condo Litigation |  Vesting as LLC or Trust |  Checking HOA Health |  Choosing a Lender |  How to Write an Offer |  Negotiating Your Loan |  WE SEARCH San Diego |  Buying with a VA Loan |  Hiring an Inspector |  Hazard Insurance Tips |  Loan Doc Signing Tips |  Moving Checklist |  2016 San Diego Market |  Buyer Resources |  Contractor List |  Buyer Strategy Session |  The Informed Buyer |  Buyer Services |  YOU SEARCH San Diego |  Agency Disclosure |  New Construction |  Avoid Moving Twice |  What is Dual Agency? |  Investor Services |  5 Reasons to Rent |  5 Reasons to Buy |  Contact Us |  Buyer Representation |  Property Taxes |  Help for Luxury Buyers |  Termites! |  Get a Home Warranty |  Paperwork Explained |  Home Buying FAQ |  Helpful Buyer Links |  Paperwork |  Testimonial - Samantha Z. |  Foreclosures |  My Blog |  San Diego Buyers Agent Review from Kevin C. |  Three Reasons to Buy in Encinitas San Diego |  San Diego Buyer Agent Review from Natacha S. |  Preparing a Short Sale Offer |  How A Short Sale Lender Analyzes an Offer |  Short Sale Lenders Approval Options |  Different Short Sale Lenders Act Differently |  Loss Mitigation vs. Foreclosure Departments |  Short Sale Defined |  The Ideal Short Sale Seller |  Why Do Banks Even Consider Short Sales? |  Some Listed Short Sales Are Not Closeable |  Testimonial Chuck Smith |  Testimonial Downtown Steve |  Del Mar Buyers Agent |  92101 Buyers Agent |  Review from Melanie & Michael |  Review from Erica M. |  Review from Daniel E. |  Review from Steve and Chi |  Review from Michael I. |  Review from John and Wendy |  Review from Allison H. |  Review from Frank S. |  Your Ivy at Carmel Valley Exclusive Buyer's Agent |  Your Sea Cliff Exclusive Buyers Agent |  Your Avery Pointe at Veridian Exclusive Buyer's Agent |  Your Lanai in Carlsbad Exclusive Buyer's Agent |  Your Pacific Gate San Diego Exclusive Buyers Agent |  Your SummerHouse Carlsbad Exclusive Buyers Agent |  Your-Park-at-Bankers-Hill-Exclusive-Buyers-Agent |  Your Aura Exclusive Buyers Agent |  San Diego Buyer Agent Review from Mary R. |  Is Fall a Good Time to Buy a New Home? |  Your Elms at Carmel Valley Exclusive Buyers Agent |  San Diego Buyer Agent Review from Dan B. |  Your Estates at Del Sur Exclusive Buyers Agent |  Your Canterra Exclusive Buyers Agent |  San Diego Buyer Agent Review from Ken and Cindy |  Three-Reasons-to-Buy-in-Hillcrest-San-Diego |  Three Reasons to Live in Normal Heights, San Diego |  San Diego Buyer Agent Review from Renaud P. |  Three Reasons to Buy in Bankers Hill San Diego |  Your Elms at Carmel Valley Exclusive Buyers Agent |  Your Estancia at Cielo Exclusive Buyers Agent |  Three Reasons to Buy a Home in La Mesa |  Your Upper Cielo Exclusive Buyers Agent |  Your Harmony Grove Exclusive Buyer Agent |  Your-Cottages-at-St-Cloud-Exclusive-Buyers-Agent |  Dog-Friendly Buildings in San Diego |  Three Reasons to Live in Kensington, San Diego |  8 Home Maintenance Tips for Spring |  Federal Interest Rate Hike and San Diego Homebuyers |  Review from Stewart H. |  Review from Roland M. |  Review from Duane and Nancy |  Review from Natacha S. |  Review from Shandi and Michael |  Your Savina Exclusive Buyers Agent |  Your Escaya Exclusive Buyers Agent |  Your Terraces at Robinson Ranch Exclusive Buyers Agent |  Your Signature Exclusive Buyers Agent |  Your Garrison Landing Exclusive Buyers Agent | 

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Globella's Real Estate Blog "For San Diego Home Buyers":

Real Estate Blog for San Diego Home Buyers | Solana Beach Real Estate Buyers Agent - 92075 | San Diego Real Estate Market Statistics and Trends 2nd Quarter 2011 | Cardiff Real Estate Buyers Agent - 92007 | Encinitas Real Estate Buyers Agent - 92024 | Coronado Island Real Estate Buyers Agent - 92118 | Point Loma Real Estate Buyers Agent - 92106 | Talmadge Real Estate Buyers Agent - 92115 | Clairemont Real Estate Buyers Agent - 92117 | Poway Real Estate Buyers Agent - 92064 | Carlsbad Real Estate Buyers Agent | Talmadge Real Estate Buyers Agent - 92115 | Clairemont Real Estate Buyers Agent - 92117 | Poway Real Estate Buyers Agent - 92064 | Carlsbad Real Estate Buyers Agent