California isn’t always the first place that real estate investors think of when they’re looking to grow their portfolio of rental properties. Prices are high, and the perfect opportunity seems like it’s hard to find. It’s true that housing prices are higher in California than anywhere else. If you’re willing to invest for the purpose of watching your assets increase in value, however, this might be the best place to buy your next rental property.
Smart investors know that there are some outstanding opportunities in a few select areas of California. Today, we’re sharing some of the markets we think are ready for your investment dollars right now. When you’re looking for some west coast rental properties to increase the performance of your portfolio, think about San Jose, Santa Cruz, and Sacramento.
We’ll explain why.
San Jose Rental Properties are Hot
Silicon Valley starts in San Jose, and this is an excellent place to invest because of the large pool of well-employed tenants roaming the valley. Their salaries can easily support the cost of real estate and rising rents. While you’ll have to spend high six figures in order to enter the market, your investment will be well worth your time and your money. It’s a growing market with a surging population, and for many people – it’s the only place they’ll be. According to Zillow, median home values hover around a million dollars.
Don’t let that number worry you because home values have increased by more than 17 percent in the last year. We expect that they’ll increase by about 15 percent this year. Your real estate is going to earn you money fast, especially when you consider that San Jose is ranked in the top 10 percent of markets across the country in terms of appreciation of real property. Invest for the long term and you cannot go wrong with a San Jose rental property.
Santa Cruz Investment Homes
Santa Cruz has the most important part of your real estate equation: location. It’s hard to beat the coastal charm and the waterfront beauty that only Santa Cruz can provide. It’s a special place, and the people who live here know it. You’ll have access to a large pool of renters in Santa Cruz who are desperately looking for a well-maintained three-bedroom home with two bathrooms and maybe a bit of yard space. Inventory is notoriously low, so don’t hesitate when you find a great deal. Buy it, and let other peoples’ money work for you while the asset grows in value.
There are a couple of investment strategies that work in a market like Santa Cruz. You can buy something on the lower end of the local price range and turn it into a high-quality rental that you’ll be able to hold onto for at least 10 years to make a comfortable profit. Or, if you’ve considered living in Santa Cruz yourself, you could buy your future retirement home and rent it out until you’re ready to occupy it.
Rental Homes in Sacramento are in Demand
California’s capital is a unique and growing market for real estate investors. If you’re looking for some California property that doesn’t cost you a million dollars, check out what you can find in the new and established Sacramento neighborhoods that are attracting tenants and interest. This is a city that’s experiencing a bit of a renaissance. Tech companies and start-ups are moving into town, and tenants are enjoying the high-paying jobs that the local economy is finally providing. Great housing prices, high quality of life, and a promising future all make Sacramento a great investment option.
You’ll see some rising sales prices, but don’t worry – home values are climbing even faster. There’s a bit of urgency to investing here. Make sure you identify what you want and claim it before everyone else arrives. We recommend you look at new construction. Single-family homes and multi-family buildings offer some of the best opportunities for new and experienced investors.
Choosing a Property Management Company for your Investment
Once you decide you’re going to invest in California, you’ll need a professional Sacramento property management company to help you. Find good managers with a deep knowledge of the local market, a lot of experience, and some creative resources for helping your investments grow in value.
We’d love to talk to investors interested in buying real estate in Sacramento. We invite you to contact us at Sunburst Properties.
Buyers who are interested in finding investment property in San Jose, please contact the talented team at Real Estate Connections, where we provide the best San Jose property management that you’ll find in the local area.
And, if you’re interested in Santa Cruz property management and investment homes, please contact Portola Property Management, where you’ll receive unparalleled service.