There are some SFH in the low $400 that still generates positive case flow.
In a year or so, the entire South Bay will join SF, Peninsula having negative cash flow as before.
If anything it would be based on speculation of appreciation if not for income tax deduction purpose to have one of investment homes.
Keller Williams Cupertino Realty
School district is typically not one of those. The reason why? In the bay area school districts that have great ratings equal high cost of real estate and low cash on cash ROI.
It may be a safer place to buy for tenant quality and appreciation but if you are buying for long term you would be better off with a mid-market investment.
There are a few areas in the bay that produce good returns for condo's.
For further advice feel free to connect via my website: http://www.RealEstateInCampbell.com
Also, with condos look out for:
1. % of units occupied by owners
2. % of units late on hoa dues
3. how much money the hoa has in it's reserve fund
#3 to me is the most important. If a condo has a decent reserve fund, they can pay for any maintenance issues that pop up without a special assessment.
With that then we look at which areas. The more you can afford the more desirable the area and the higher the cost to purchase.
If you focus on properties typically owned by investors: duplexes and other multifamily homes, properties in unfavorable locations, properties with a large nearby college or if you are willing to fix up a property you stand a better chance of getting a positive cash flow or close to a positive cash flow.
Locally a few parts of San Jose have home prices which are slow to recover and areas towards the south such as Morgan Hill, Gilroy etc. Mortgage payment to rental income should be more favorable.
South San Jose real estate statistics http://julianalee.com/san-jose/south-san-jose-statistics.htm
Alum Rock real estate statistics http://julianalee.com/san-jose/alum-rock-statistics.htm
Morgan Hill real estate statistics http://julianalee.com/morgan-hill/morgan-hill-statistics.htm
Gilroy real estate statistics http://julianalee.com/gilroy/gilroy-statistics.htm
Prior to the economic downturn many Silicon Valley residents were investing in real estate near Sacramento because the mortgage payment to rental income was much more favorable than locally. The high ratio of investment vs. homeowner is probably why that area was hit so hard by the downturn.
Top 2 agent nationwide at Keller Williams Realty, the nations largest
Over 20 years experience
Over 1,000 homes sold in Santa Clara and San Mateo Counties
I agree with Terri response but also the school district and test scores should be review to see where the highest scores are. Depending how you finance and the rate of return you want on your investment.How long are you planning top hold the investment should also be in your thinking on where to buy. Also in consideration are you going to self manage and how are you going to pick your tenants.
RicharD Matusich Realtor DRE#00358728.
Richard G.Matusich and Associates Realtors inc,
2940 Union Ave #B
44 Years in the Real Estate Business with offices in san njose, Aptos and Pleasanton