All Forum Posts by: Greg Lieberman

My two cents.... 

Here is the purely math answer: It is already difficult enough to get an ROI in our market. Having a pool will add additional monthly and yearly costs. My pool is $125 per month for maintain, plus occasional other costs. If you feel you can get rents to cover those additional maintenance costs, additional insurance and compliances costs, have a little extra to make an ROI on that and be competitive with other properties, then it is worth considering.

Here is the liability answer... We also live in California which is traditionally more litigious than other states, less landlord friendly and known for changing the rules (on everything...) frequently. So if you, or your property manager and pool people, can keep current on all of the applicable rules, make sure the house is regularly in compliance, the house gets the ROI, AND you feel like the risk outweighs the reward, then it is worth looking into.

I don’t think there anything wrong with Rancho Cordova. It’s just not one of those places that comes up too often as a place on the top of a buyer’s list. Just the check the schools, crime stats and all that usual stuff to make sure you’re in a good area. 

Wherever you plan to buy, I wouldn’t wait to try and time the market. I have had a couple clients wait and then they couldn’t afford the same house they wanted. Last year I had a client that was trying to buy in October 2020 and didn’t actually buy until late summer of 2021. He probably lost tens of thousands of dollars worth of value.

I think if you plan on having the house for a while, don’t wait. Make sure it’s the right area and meets your criteria, but I would not suggest you wait and try and time it.

@Priyanka B.

Hi there! I’m an agent here in Sacramento, and know the area pretty well. This a market that generally won’t have cash flow (on year one) unless you are putting a lot more than 20% down. But it is definitely a market that has had lot of appreciation historically.

When we look at numbers, we look at how the property performs over its first three to five years. For those putting 20% down, it's pretty common to see negative monthly cash flow of about 150-200 on year one. That's with 5% vacancy, 5% for CapEx and about 6% for property management.

Right now the max rent increase is 6%. So if your property is charging market rents, it’s usually negative 150-200 the first year and then neutral to low cash flow in year two or three. If it’s already tenant occupied, they are rarely charging market rate, so the figures will be worse.

You still get all the tax benefits of depreciation, interest write offs, etc. and the value of the home likely increasing.

Usually when you see areas that have higher cash flow than that, they are the areas that tend to have more headaches or require more attention. So generally, we look at it like a spectrum: one side is more passive and less headaches, but has less cash flow. The other side requires more attention, but the ROI and cash flow are better.

If you want the less work and less cash flow option, I would look at areas like Folsom, Roseville, Rocklin and some neighborhoods in Sacramento.

The areas that are likely more work, but higher cash flow would be most of Citrus Heights, Antelope and some parts of Rancho Cordova and Sacramento.

Sorry this was long winded, but hopefully it helps. Good luck!

Are you only looking at new construction? You should be able to find homes from 1500 sq ft to 3500 sq ft in both areas. Regardless, both are great areas. I would go where the number make the most sense for you. 

I have spent a lot of time in that area over the years.  There are lots of schools all over West Roseville.  Two high schools west of Woodcreek Oaks.  Its about 6 miles to Sutter Roseville form Woodcreek/Blue Oaks Blvd.

Anything off of Fiddyment is newer and tends to be very desirable.  Great schools, lots of parks and trails, etc.  Mello-Roos is higher in Fiddyment Farm, Westpark and Westbrook (Westbrook has 60 year bonds), so I usually replicate a tax bill to make sure my numbers are accurate, when comparing it to more established areas that have lower taxes.  

Crocker Ranch (Blue Oaks/Crocker Ranch Rd) is a little more established, but just about the same in desirability.  They can also have higher Mello-Roos than some other areas as well.  

The Woodreek corridor is also a solid choice.  The Blue Oaks/Woodcreek area is brand new so you can expect the Mello-Roos to be higher than some of the "older" areas built in the 90's and early 2000's.

My wife did the Mello-Roos districts for the city for many years, so sorry if I geeked out on that a bit. ) 

@Ramki Dirisala

I think Roseville, Rocklin and Folsom are great options. I’m not as big of a fan of Elk Grove. But all three will have roughly the same appreciation and quality of tenants (assuming you are looking at similar properties).

My top choice would be Roseville. It has similar amenities to Folsom, but has the best utilities. You’re not likely to have rolling blackouts with Roseville Electric.

Roseville and Placer County also tend to be more business and landlord friendly than Sac County areas too.

This is all based on me being a realtor out of Roseville, a former policed officer in Roseville (medically retired: ankle surgeries) and my wife worked for the City of Roseville for about ten years and now works for Placer County. So I do tend to look at how the municipalities operate more than most.

Mine was $9,000 with Rocklin Heating and Air for a single stage system by Carrier, in April of 2019. My house is two stories and about 2600 square feet. My neighbor across the street lives in a 3200 square ft house and his was $12,000. But being that we are about to have a lot of triple digit heat, you can expect the demand and the price to be higher than the colder months. 
FYI: Single stage just means it blows at 100% power or it’s off. Versus dual stage that can blow at 50% or 100% power. Or incremental stage that blows at the exact amount of power needed for whatever job it’s doing. I assume the majority of people have single stage. 

@Bei He

When mine went out I got five bids. They ranged from 12,000 to 22,000. Rocklin Heating and Air was the lowest. We used them and they were great! In fact, I just referred them to my neighbor and he was really pleased with their work too.

Hey Antonio!  I'm an agent in the Sacramento area.  Strictly speaking, when you're an agent, you're always an agent.  So the rules for disclosing you're an agent alway apply (even out of state i'm told).  So depending on what your strategy is for getting deals, you might have to add your license number, brokerage name and some other criteria.  

This is a from from the DRE that outlines some requirements: https://www.dre.ca.gov/files/p...

Hey everyone!  I look forward to seeing you all tonight.  This is my first time at Out of Bounds.  Is there a certain area we are meeting at or anything?  I'm just trying to avoid aimlessly wondering looking for the group.  :-)