Condo in Lake Merritt or SFH in Fruitvale?

[Tea Houck]

Hey Bay Area investors, I've been spending the last couple weekends driving around Oakland and going to open houses. My partner and I are intent on buying in Oakland as our primary goal is winning the 2 - 3 year game on appreciation. We may hold longer than 2 - 3 years depending on where life/jobs take us. For now, we rather bet on housing than stocks.

Here's the dilemma. Do we buy a condo in Lake Merritt or a SFH in Fruitvale?

Lake Merritt Condo:
Pros: less maintenance than a SFM. Lake Merritt, especially Adam's Point, is already a gentrified area. Uber is moving in just a 20 minute walk from Adam's Point in 2017. This could cause prices to inflate to SF levels.
Cons: HOAs are extremely high making most properties in Adam's Point cashflow negative. Plus, we may have missed the boat in terms of appreciation. Right now a 1bd 1ba is going for $550k. Will they get to SF levels where 1bd condos are going for $800k or more?

Fruitvale SFH
Pros: more likely to get a deal on a place that needs some renovations. We could get a place for $500K or less. Could renovate and add value. No HOA fees. Potentially cash flow break-even.
Cons: more maintenance costs for a SFH. Less sure what type of person our renter would be. Plus, the area feels like it's in the early stages of gentrification, but I don't have evidence that it will be more gentrified 3 years from now. Many parts still have higher crime and lots of unsightly buildings and businesses. Will it change?


I'd love to hear your thoughts about these two areas and about the two types of properties in them. Thanks so much in advance everyone!