Originally posted by @Aaron Mazzrillo:
Originally posted by @Richard Dunlop:
If you can weather the next 6 year down cycle with negative cash flow then jump head first into the SF market.
I don't know how far away the down cycle is some are saying 1 year I think possibly more than 3. But what is your exit strategy? Sell for appreciation before the collapse? Will the property cash flow BEFORE the fall? Enough to survive the hold time in the fall?
... To make nonsensical, unsupported claims that we will have a collapse and 6 year down cycle ...
I'd rather flip one $600K house here and make 10-15% return on my money than buy rentals in Detroilet, hold and manage them until I got to that same $60K-90K payday, and we won't even get into the discussion on quality/quantity of lifestyle.
CA is great I love it.
I walked near your area in 2008 2009 Hesperia, Victorville, Apple Valley, high desert and the banks were selling everything. One block had 9 houses in a row all foreclosed 3 year old houses. Trying to sell Pulte homes for $75,000-$90,000 that had sold new for $320,000-$350,000. Tremendous opportunities.
I looked at one house Listed at $89,900 and I talked to the next door neighbor. I pointed out he was still there everyone else was leaving. He said he was leaving the following week.
I asked him why and he said he had put $90,000 down on his house but the bank was asking $100,000 less for the house I had just looked at than the amount he still owed on his house. And his house was about 700 sq ft smaller. He was also tired of a 3 hour one way commute.
I can show numbers better than you mentioned but the purpose of my post was not to attract people to my area but just to input that the OP needs to plan an exit strategy if he were to invest in SF today,
I am not trying to guru predict the market; I have no tea leaves to read and no crystal ball. But there will be cycles.
You are in a great area to Flip. Riverside/San Bernardino counties are humongous and diverse. But does your $600,000 sale you mentioned cash flow for the buyer?
The OP is in San Francisco Do you think he could buy any SFR today that would cash flow? My questions are legitimate "can he cover the negative cash flow for a long period of time?" Including a possible down turn when he may not be able to sell for even acquisition cost.
