small multi family in california vs your state

[Valentin Zalutskiy]

I have been looking and analyzing duplexes and triplexes in northern california for close to a year using the parameters I learned from Biggerpockets. I have found none that met the "good buy" parameters, and only a couple that still had a cash flow after deducting the recommended percentages for the costs. My question is how are the other states doing? 

My plan was to make my first purchase a duplex so I can start off my portfolio, but at this rate, I may have to buy a single family home.  I get that I'm new at this and don't have an in on the off market buys, but....this is very disheartening. 

[Johann Jells]

Originally posted by @Jason Hirko:

@Ali Boone Of course Texas! Downtown Austin? No, not as much. But you can find 25% gross annual returns in almost every secondary market in Texas from duplexes on up. I would rather spend $4MM on a 150 unit in Brownsville than $4MM on a 8 unit in some silly California market!

By "25% gross annual returns"  do you mean Cash on Cash or GRM?

Cashflow vs appreciation has been argued here on and on for years. It all depends on your market and timing. I've got a property here in NJ bought in 97 that cashflowed early on as a househack AND has appreciated CoC >56X. Yes, I put down $60k and it's now worth $3.5m (and is probably a teardown at this point). NJ, NY & CA have seen returns like that over the last 2 decades, TX not so much. Could I do that today? No. But I bought one in 2012 that has tripled in price. Appreciation markets are a real thing not to be scoffed at if you don't need the cash to live on. That's the bind that a lot of BP folks are in, they want to quit their day jobs rather than increase their equity.