All Forum Posts by: Rachel S.

I do have a SFR in the San Bernardino Mountains that has been a great investment, but only because I bought it in 2011 as an REO for a really low price. For that reason it cash flows and I have gotten some major appreciation. I don't think I would would go there again. Unless I could buy for a similar discount. Especially as the industry up there is based mainly around tourism, which can be volatile. I would worry about people's ability to pay rent if that industry takes a hit (like it has during covid).

As for Riverside, I love Temecula, but I am looking for multi family and I don't think that city has any. If they do, I haven't seen them. :-) I haven't researched many other areas though. I have been to the Hemet/San Jacinto areas and those are a hard no for me right now.

@Chris Gawlik

I disagree. Pretty much all the people I have been talking to was able to push their forbearance to the back of their loan term (30 years, 15 years, etc). Which mean they don't need to pay all of them back at once. In fact, they can just sell their home and use the instant equity gain (5%-10%) earlier this year to pay back those forbearance. There will be no foreclosures. Banks do not want to go through foreclosure process if they don't need to.

I feel like this ignores the human behavior part of the equation though. Most owners are not thinking of their primary residence in the same way that an investor thinks of a investment property. There is a lot of emotion and pride involved. That's why I see pre-foreclosures in my local market all the time, who had significant equity in their homes and could have certainly sold if they were motivated to do so. Instead they buried their head in the sand until the bank finally foreclosed.

Also, look at all the stuff going on right now, if the housing market crash like 2008, the U.S. is gonna be in real trouble. Do you really think the Fed is gonna let that happen? They're doing everything to prevent the housing market from crashing, and one of the thing they did was lower the interest rate to boost demand in housing, and forbearance to prevent forclosures. What else are they gonna do? We don't know, but one thing we know is that the 2008 thing will not going to happen again.

I am not so sure. A 3 month forbearance is not going to help individuals who genuinely can't afford their mortgage anymore and banks will not further extend the forbearance. Some of those people will sell but others will join the "head in the sand" crew that I mentioned above. I don't think there will be the sheer volume of foreclosures that we saw in 2008-2012, but I think there will be foreclosures. People who already have missed several mortgage payments (or other bills) and tanked their credit, cannot refinance with a lower interest to lower their payments. Even if it would help them. That's even before you consider the percentage of investors were over leveraged and cannot cover their mortgages because their tenants cannot pay rent. I don't know what will happen for sure, but it's hard to imagine there will not be a fallout.

 Our realtor handles everything for us. For example we saw a preforeclosure. It’s in a trust, she’s written up our offer to the bank to try for a short sale. Our realtor specializes in these types of deals.. she’s in CA maybe can help you too. Not sure. She still gets her commission from the seller/bank etc. Or she offers to the owner and helps handle and liens etc etc. find a realtor who understand this. Many don’t!

Thanks so much this is helpful! Appreciate you offering to take a look at properties I find in those areas. Last question, what do you think of Inglewood, Hawthorne and Gardena areas? 

Some people on BP are interested in Inglewood and Hawthorne as buy and hold prospects, due to development in the area. In my opinion, they are still pretty transitional and may not be what you are looking for. Unless there are some pockets I am unaware of... I don't know those areas as well as Torrance and San Pedro, in terms of specific neighborhoods. 

@Wan-Yi Sweeting

Out of those areas, I would rank EL SERENO the lowest. But it's nothing compared to 20 years ago. It's a lot safer now and it's close to a university.

I do agree that classifying an area as "ghetto" is very relative. I spent most of my life in EAST LA/ BOYLE HIGHTS, which 30 years ago was rough but now development is starting to happen.

Im also looking at house hacking. I've been driving to the neighborhoods to get a feel for them. Asking the locals is also very helpful.

I don't know much about the Valley, but El Segundo will likely be pretty expensive. Torrance is a mixed bag. Some zip codes have a Torrance zip but are actually part of the LA strip. I think the areas you might feel comfortable in are the 90505 and 90503 zip codes, but those come at a premium too.

I am looking in San Pedro. The areas I am looking in are probably a solid C with potential. I don't intend it to be a house hack, more of a buy and hold. With that said, there are plenty of neighborhoods that I would consider B- to B+ in San Pedro that I would feel completely comfortable walking around in during the day. The only problem is that they are not particularly walkable to shops and restaurants, which you said was important to you. They will still be less expensive than El Segundo and the Torrance zip codes I mentioned though, so maybe you'll consider it a trade off. Depending on your budget of course. 

If you decide to look in San Pedro or Torrance and find a property, I'm happy to let you know what the area is like.

One thing I do when I drive an area (though I know my own area in my sleep): I drive around at 1 or 2 PM on a mid-day weekday, like a Tuesday or Wednesday. If I see a lot of able-bodied people (mostly men) hanging around the houses on porches, corners, etc. at that time, I'm unlikely to consider it much further.