Newbie Investor San Diego Buy and Hold Strategies

[Taylor Robinson]

Hey guys! First off I'd like to thank the BiggerPockets community for the wealth of information provided. I am extremely new to real estate investing, but have learned more from this community in the last few months than I ever could have imagined. I am interested in buying and holding SFRs/condos in the San Diego area, but have not been able to find anything that comes anywhere close to the 2% rule of thumb (I realize it's just a quick and easy rule and not the ultimate determinant of profitability), or the 50% rule of thumb (which in my mind is the "rental income must be at least twice the mortgage to cash flow" rule; please correct me if I interpret this rule incorrectly). I primarily use sites like realtor.com, Redfin, and Zillow to find listings. Are there other places I should be looking to find homes that come closer to the rules of thumb? Is anyone having success with buying and holding in San Diego? Thanks in advance for any advice! I'd love to hear your stories! Taylor Robinson

[Justin R.]

@Taylor Robinson Don't waste your time waiting around for "2% Rule" properties here.  Depending on specifics, I would also generally say you shouldn't waste your time waiting for "1% Rule" properties either.  And, please don't get sucked into thinking it all boils down to "cash flow" vs "speculating on appreciation" - that thinking is too simplistic.

That said, I personally don't find the SFRs and Condos for traditional buy-rent-hold to be investable at this point.  As @Dan H. suggested, I would focus my energy on lots that have/could have multiple units.  Even there, I'm only seeing value-add type opportunities.

If I had to use an analogy based on my sphere of visibility, I'd say buying in San Diego right now is like diving into a 4 foot deep pool.  The water is as refreshing and profitable as anywhere else, but you better make sure you've got good form 'cause your margin for error isn't so big.