You've raised some valid concerns about California, and it's true that the state faces significant challenges. However, dismissing it entirely based on these issues overlooks several factors that continue to attract people and investment:
Diverse Economy: California boasts a massive and diverse economy, far beyond just Hollywood. It's a global leader in technology (Silicon Valley), agriculture (Central Valley), international trade (ports of Los Angeles and Long Beach), and tourism. This economic strength creates job opportunities and attracts talent from around the world.
Innovation and Entrepreneurship: California has a deeply ingrained culture of innovation and entrepreneurship. It's a hub for startups, venture capital, and cutting-edge research. This attracts ambitious individuals seeking to build the next big thing.
World-Class Universities: California is home to some of the world's most prestigious universities, including Stanford, UC Berkeley, UCLA, and Caltech. These institutions attract top students and faculty, contributing to the state's intellectual capital and driving innovation.
Natural Beauty and Diversity: While you mentioned the weather (which is undeniably a major draw for many), California's natural beauty extends far beyond sunny beaches. It encompasses diverse landscapes, including mountains (Sierra Nevada), forests (Redwoods), deserts (Death Valley), and national parks (Yosemite, Sequoia). This offers a wide range of outdoor activities and recreational opportunities.
Cultural Hubs: Cities like Los Angeles and San Francisco are major cultural centers, offering world-class museums, theaters, music venues, and diverse culinary scenes. They attract artists, creatives, and people who appreciate a vibrant urban lifestyle.
Real Estate Appreciation (Historically): @Dan H. points this out with his bathroom addition. While recent years have presented challenges, California real estate has historically seen significant appreciation, particularly in desirable coastal areas. This has made it an attractive investment for some, though high prices and increasing interest rates are currently impacting affordability.
Addressing your specific points:
In summary: While California has its problems, it's not a simple case of "everything else sucks." The state's economic dynamism, natural beauty, cultural attractions, and educational institutions continue to draw people and investment. Whether these factors outweigh the challenges is a personal decision.
San diego, los angeles, and san Francisco violent crime rate is low compared to most large cities outside california. The 3 of them are below Cincinnati, cleveland, and toledo.
The lowest city on the list on wikipedia for violent crime is irvine, CA
https://en.m.wikipedia.org/wiki/List_of_United_States_cities...
Any violent crime is too high but i travel a bit. I feel far safer in the roughest parts of San Diego than i do in many large cities outside CA.
People seldom look at actual crime numbers. What they see is what their media presents to them. A crime in a low crime area may be media worthy but the same crime in a high crime area may be just another day.
in my neighborhood (poway), kids playing doorbell ditch or riding 3 on an electric bike warrants posting on social media and dozens of comments (no exaggeration). Must be nice that those “crimes” deserve so much attention.
It is my belief that most RE investors are best served initially investing near their home. After they have some experience they can decide if other markets are likely to suit them better. I believe this is true for high price san Francisco and lower priced detroit and most markets in between.
Best wishes
San Diego, Los Angeles, and San Francisco having a lower violent crime rate than Cincinnati, Cleveland, and Toledo is not an accomplishment by any means. You are comparing 3 cities where you pay one of the highest premiums in the USA to live to 3 of the cheapest cities in the USA. This would be like me telling you my Escalade drives better than your KIA. Duhhhh, of course it does.
I am confused because here is what the data I find says:
Now I'm no expert on the topic but CA is still the only place I've ever been where people pop-out of the scrubery to ask if I want a BJ as entire family is loading back up (including grandkids) from a dinner out......
Only place I felt "safe" in CA was on base. Seems most in CA are rather desensitized to it all. That's my experiences.
MN #'s seem accurate to me. CA #'s, that's been my observation of things. OH, no idea, only ever passed through.
Ummmmmmm...I've lived in California since 1990 and own multiple investment properties there. Over the years, I've lived in South Central Los Angeles (while in design school), West Hollywood, Hollywood, downtown LA, Marina del Rey, Santa Monica, Napa, (in the Napa Valley), Angwin, (also in the Napa Valley) and I currently reside in Lodi, about 2 hours from SF. I have to ask, where did you take your family for dinner? Perhaps you should choose a restaurant in a better part of town next time. 😂 I have never even heard a joke about California that bad, haha! If you need some family-friendly dinning recommendations just ask 👍
I already said, Oceanside.
We were staying in Pendleton (yes, on-base). We WERE in the "nice area". My son-in-law took me for a drive to see the nightmare that is the bus station there, with the hobo's galore. Right off the main drag.
That kind of thing, the homeless, tent camps, there all over the place in CA. I think it's that one just get's desensitized to it over time. I saw it near every beach (except on-base), highways, urban centers throughout CA.
Maybe you don't notice it, but it's notable to others who have experienced life outside of CA and don't have CA as the singular center and whole of the universe in their mind.
I have been all over the world and tour investment markets regularly throughout the US. CA is a standout in this regard.
The only other location that compares in such is South Africa, where "shanty towns" dot the landscape.
So as a NON CA world traveler, that was the "feel" of southern CA; tons of amazing potential and weather, views etc but with 3rd world problems that seem to be accepted and ignored by all.
I was born in Toronto, Canada and grew up living in different towns throughout Ontario. I have traveled through every province in Canada. I have been to Mexico, Panama, Costa Rica the Bahamas, Hawaii etc.. etc.. Yes, homelessness is an EPIC problem in California. It is the same in Vancouver (now), Phoenix, San Francisco, and if you look for it, pretty much every major city in the US nowadays. I even have a cousin who is homeless - by choice (?!??). She switches between LA and Phoenix. I've always thought that if I was homeless I would probably choose a state where the weather wouldn't kill me, like LA. But also, the sad truth is that housing is too expensive, drugs are too addictive and adequate mental heath care is insufficient. And you are right. I live here. So I don't drive by the homeless encampments - unless I'm volunteering. I don't give out money to foster addiction, only food to fill stomachs. It is an ugly, tragic reality in California and everywhere else where it exsists.
When I moved from Canada to the US it was shocking that I had to stand in line at 5 am at the free clinic w/10 other people just to get medical care for strep throat. Some of those people had full-blown AIDS. I couldn't not understand why this great nation didn't have health care. It blew my mind but I suppose you get used to what's considered "normal".
Having actually lived in Hollywood, West Hollywood and downtown LA, your comment about the sexual nature of the assault you suffered isn't typically seen in homeless communities. Not blatantly. It's seen in the areas I just mentioned. There were always prostitutes on the corner of my street when I lived in Hollywood, but ironically, no homeless people. Male and female prostitutes and lots of drugs. So, I no longer live in those areas and am very thankful to finally have insurance.
I would never move back to Canada. I love California and the weather here. What no one has yet mentioned is the movie industry. I saw and literally ran into countless celebrities while in LA. That part of Hollywood will always have allure. I would love to explore the rest of the US - if I had the money. Who knows, maybe there is a state that can parallel the great weather in California, the five-star restaurants in Napa Valley, the geographical diversity, the rich ethnic influences, the skiing and surfing all in the same day and somehow, have no homeless people. Kind of sounds like heaven... If anyone on this site knows of a state like that please tell me. I will retire there!!!
You've raised some valid concerns about California, and it's true that the state faces significant challenges. However, dismissing it entirely based on these issues overlooks several factors that continue to attract people and investment:
Diverse Economy: California boasts a massive and diverse economy, far beyond just Hollywood. It's a global leader in technology (Silicon Valley), agriculture (Central Valley), international trade (ports of Los Angeles and Long Beach), and tourism. This economic strength creates job opportunities and attracts talent from around the world.
Innovation and Entrepreneurship: California has a deeply ingrained culture of innovation and entrepreneurship. It's a hub for startups, venture capital, and cutting-edge research. This attracts ambitious individuals seeking to build the next big thing.
World-Class Universities: California is home to some of the world's most prestigious universities, including Stanford, UC Berkeley, UCLA, and Caltech. These institutions attract top students and faculty, contributing to the state's intellectual capital and driving innovation.
Natural Beauty and Diversity: While you mentioned the weather (which is undeniably a major draw for many), California's natural beauty extends far beyond sunny beaches. It encompasses diverse landscapes, including mountains (Sierra Nevada), forests (Redwoods), deserts (Death Valley), and national parks (Yosemite, Sequoia). This offers a wide range of outdoor activities and recreational opportunities.
Cultural Hubs: Cities like Los Angeles and San Francisco are major cultural centers, offering world-class museums, theaters, music venues, and diverse culinary scenes. They attract artists, creatives, and people who appreciate a vibrant urban lifestyle.
Real Estate Appreciation (Historically): @Dan H. points this out with his bathroom addition. While recent years have presented challenges, California real estate has historically seen significant appreciation, particularly in desirable coastal areas. This has made it an attractive investment for some, though high prices and increasing interest rates are currently impacting affordability.
Addressing your specific points:
In summary: While California has its problems, it's not a simple case of "everything else sucks." The state's economic dynamism, natural beauty, cultural attractions, and educational institutions continue to draw people and investment. Whether these factors outweigh the challenges is a personal decision.
San diego, los angeles, and san Francisco violent crime rate is low compared to most large cities outside california. The 3 of them are below Cincinnati, cleveland, and toledo.
The lowest city on the list on wikipedia for violent crime is irvine, CA
https://en.m.wikipedia.org/wiki/List_of_United_States_cities...
Any violent crime is too high but i travel a bit. I feel far safer in the roughest parts of San Diego than i do in many large cities outside CA.
People seldom look at actual crime numbers. What they see is what their media presents to them. A crime in a low crime area may be media worthy but the same crime in a high crime area may be just another day.
in my neighborhood (poway), kids playing doorbell ditch or riding 3 on an electric bike warrants posting on social media and dozens of comments (no exaggeration). Must be nice that those “crimes” deserve so much attention.
It is my belief that most RE investors are best served initially investing near their home. After they have some experience they can decide if other markets are likely to suit them better. I believe this is true for high price san Francisco and lower priced detroit and most markets in between.
Best wishes
San Diego, Los Angeles, and San Francisco having a lower violent crime rate than Cincinnati, Cleveland, and Toledo is not an accomplishment by any means. You are comparing 3 cities where you pay one of the highest premiums in the USA to live to 3 of the cheapest cities in the USA. This would be like me telling you my Escalade drives better than your KIA. Duhhhh, of course it does.
I am confused because here is what the data I find says:
Now I'm no expert on the topic but CA is still the only place I've ever been where people pop-out of the scrubery to ask if I want a BJ as entire family is loading back up (including grandkids) from a dinner out......
Only place I felt "safe" in CA was on base. Seems most in CA are rather desensitized to it all. That's my experiences.
MN #'s seem accurate to me. CA #'s, that's been my observation of things. OH, no idea, only ever passed through.
Ummmmmmm...I've lived in California since 1990 and own multiple investment properties there. Over the years, I've lived in South Central Los Angeles (while in design school), West Hollywood, Hollywood, downtown LA, Marina del Rey, Santa Monica, Napa, (in the Napa Valley), Angwin, (also in the Napa Valley) and I currently reside in Lodi, about 2 hours from SF. I have to ask, where did you take your family for dinner? Perhaps you should choose a restaurant in a better part of town next time. 😂 I have never even heard a joke about California that bad, haha! If you need some family-friendly dinning recommendations just ask 👍
Well, no one else has mentioned it, so I will......what about the current LA fires and the ongoing mis-managment of the forest and brush? A lot of people in the current fire area had their insurance canceled lately and are really screwed, Reminds me of Florida and the insurance problem caused by the hurricanes.
I've got "10 doors" in Northern California, and my biggest SFR just had its homeowner's insurance canceled. Now, we have state insurance. It went from $120 a month to $670 a month because of the fires. And now Southern California is on fire. Does anyone want to buy a great rental property in the Napa Valley? It's a cash cow!! Tenants stay for 10-15 yrs. No vacancies. I rebuilt it in 2005-2006 and did a total rehab and massive mold remediation. Cost: $100,000 plus. Then "subdivided it" into 4 units. It's a big house w/attached granny unit and remodeled 1 bedroom garage studio - that's why it makes so much rental income. 15 mins outside of St. Helena.
Where do you think people are growing richer with real estate.....Los Angeles or Cleveland? Owning just a few typical properties in California turns you into a multimillionaire very quickly. Owning a few typical properties in Cleveland gets you an extra $500 a month.
😂😂😂 I have "10 doors" (not trying to sling the lingo); it's the easiest way to explain my properties in California. Yes, I am finally questioning my California investments, but what you say is so true that I laughed out loud. I love that you stated it so briefly and succinctly, to. I've always said if you can make it in California, you can make it anywhere, right?
Renovations and dispositions before the financial world fell apart…
As my partner and I both realized we didn’t have a lot of interest in running the operations of our real estate investment company, we began the process of preparing to sell what we acquired. It was not as simple as a stick-a sign-in-the-yard disposition process. Many of the “deals” we acquired required a lot of work to be market ready. I learned firsthand the meaning of sweat equity, even though I would ultimately realize very little equity.
Many years later, I would realize that, even though I made very little profit during this phase of my investment career, I was still extremely fortunate. Fortunate to get a great education. And even more fortunate to learn my lessons in a forgiving market in a forgiving market cycle. Many much admired mentors in multiple markets would not be as lucky.
Our projects circa 2007 required a lot of work before we could sell them. Much of our value came in tackling other people’s problems, specifically large, unwieldy renovations. Our wide-open buy box and fast and loose acquisition model also meant we were not satisfied with buying and flipping standard, traditional properties.
Purchased at a foreclosure auction, the pinnacle of our unbridled acquisition was a double A-frame home sitting cantilevered in a pond with an enormous homemade infinity pool. The home, previously owned by an electrician, was still inexplicably an electrical nightmare. There were hardly any right angles and very little that could exist in the home unexposed. Not a project I would recommend for nascent real estate rehabbers; we approached it with giddy optimism typical of this time in the market cycle.
This project which I affectionately dubbed “The Mistake in the Lake” would consume a solid six to twelve months of my life and end with a 6-car garage, a waterfall-feature flowing under the home into the pond, and a spiral staircase installed by a guy named Gator. Thankfully not all projects were the heavy lift like this one.
One project on the edge of “The Hill” area in Augusta which we did little cosmetic work to, sold quickly and above our expected price. After expressing my shock at the sale, I received some wisdom from our broker who was a second generation real estate guy. Quoting his father, he said simply, “Real estate is crazy.”
My goal, for my process-oriented mind, was to make my real estate less crazy and more predictable. However, we were basically gambling on every transaction at this point in our career. The adrenaline was intoxicating but the bank accounts and accounts payable were very sobering. Fortunately we were pretty decent at selling. Not as good as we were buying, but good enough to execute most of the sales before the world started unraveling.
The best decision we made during our disposition process was seeking out seasoned agents who were specialists in their market niches and letting them work their magic in their market specialties.
Check back soon for more adventures in investing.
PSWhere did you get the cash for your acquisitions and money for rehab?
I own an HVAC company and 99% of my work is for home warranty companies. HWA, Choice and Select. Know this, those companies only provide equipment and do not pay the contractor enough to install it. This leaves the policy holder with that cost. If you need your a/c condenser replaced expect to pay an extra $1200 to $3000 to the contractor. It is about half of what you would pay without the warranty. The only benefit is with simple repairs like motors and other parts. they will cover 100% of that.
Because we had Fidelity before we had Home Choice and they actually fixedthings. I’ve always had a home warranty on every owner occupied property we’ve owned and replaced at least one appliance with it. But no one has ever required photographs just to prove the broken unit existed.The plumber did notify us that in our area, Home choice is notorious for being almost impossible to deal with and covering virtually nothing. He said everyone hates working with them. Do you find them to be more difficult than some of the other companies?
@Guy Gimenez Well, if real estate doesn't work out for you you should consider journalism, or poetry, or motivational speaking! You write beautifully. Your post was very inspiring. (400 doors from a $50K syndication? I would have had trouble not laughing out loud! 😆)
@Becca F.. Thank you for your reply. I will take that as good advice for myself!!
@Ned J. Couldn't agree more!!! A large part of the property is its rural location. Companies didn't want to travel that far if they were not going to get a replacement job and when the warranty company requested things like detailed photos and written, itemized replace vs repair estimates they quit answering the phone altogether! It's been a tough predicament all around but a good lesson learned! It will never happen again!
PS
If I didn't mention it before, this house is in California, in Napa Valley. We have mild winters and we provided space heaters to all of the tenants while we tried to get the problem figured out. We pay all the utilities and our PG&E heating costs have substantially increased but we did not pass that on to the renters.