Santoso.l, Home Owner in San Jose, CA

William Lyons home on 9th st

Asked by Santoso.l, San Jose, CA Wed May 4, 2011

I'm considering to purchase a single family house from William Lyons on 9th St and Taylor. It's facing a busy Taylor Street. What do people think of this property? Will it appreciate 4-6% anually in the next 5-6 years? I'm thinking of buying this as an investment (renting rooms or the whole unit) and would only live here for less than 5 years. It's 4 bedroom 2.5 bathroom.

Help the community by answering this question:

Answers

8
Hi Santoso,

Just an little input on buying investment real estate in today's market. Buy based on a positive cash flow today and not what will happen in the future. If you're financing based on a short-term adjustable mortgage, make sure you factor in at least 2 years of adjustments into your planning. As others have said, no one can predict the future. If you're buying based on future returns, you may not like the outcome.

A bigger indication of value in your rental will be how you YOU as the owner make sure the property is maintained. I can't tell you how many times I've seen people buy rental property, collect the rents and walk away. Make sure repairs are completed in a timely manner and the properties condition is maintained will do much to saving you time, money and headaches. A repair reserve (not including their deposit) is a very good idea.

Good Luck

David Sciplin
Better Homes and Gardens Real Estate
david.sciplin@bhghome.com
0 votes Thank Flag Link Thu May 5, 2011
Santoso

I've shown clients these homes and they're pretty nice. The developer has offered specials now and then so that's something you might want to find out about before purchasing. But that is better done working with an agent. I know when I have spoken with the sales staff that Cisco hi-tech professionals were moving in. The light rail is only eight blocks away so that would attract some buyers. Japan town and the surrounding area is continually changing. This neighborhood is developing their own association so they will have a voice on what concerns them from parking to development.

As far as an investment property in new developments the new homeowners may not appreciate that since they're invested in not only their home but the commuity. There's nothing wrong in doing this but build rapport with your neighbors before putting renters in the property. New developments take time to address new build problems and neighbors in strength get things done.

I think in 4-5 years you'll see lots of changes in that area. Before the Redevelopment Agency disbands all together get a copy of their 5-year plan. I did that before buying in downtown San Jose a decade ago. There are a lot of plans for the area and it's not all about housing.

Virginia Thomas
0 votes Thank Flag Link Thu May 5, 2011
When purchasing homes in a Planned Unit Community (PUD) you will want to under stand their rules and regulations regarding renting out rooms.

As for appreciation, you've learned we are not mind readers. We would hope to see those types of appreciation, however, in my own opinion I'm very conservative and would lean more on the 3% when estimating any potential return on investment.

Our interest rates are very low right now so leveraging is greater than it has been in the past. However, several people are predicting that those rates could go as high as 6.5% this year. I'm not entirely convinced they'll jump that much, but with the government controlling the money and needing to replace those funds nothing is out of the question.

Yes, San Jose has built a lot of new high rises and there are plans in place for additional when the market changes, however it takes a long time from planning to building and eventually selling those units and they is why the 360 is now a rental vs a condo (for now).

if you are not working with an agent, it is advisable to do so, because you are going to be looking at several properties and that agent will be better able to serve you knowing all the details of each property.

All the best to you.
Web Reference: http://www.terrivellios.com
0 votes Thank Flag Link Thu May 5, 2011
Thanks for the quick answers so far. I was told there there will be a lot of new development in the area. Is that true? Where can I find the places/area of new development sites? I'm not entirely convinced since there are already lots of old neighborhoods packed in the north and east side which are not so great.
0 votes Thank Flag Link Thu May 5, 2011
Santoso:
If the home is big enough to allow for a home business, that would be a plus on that street since so many parts of it are commercial. From what I am seeing in lending circles (I work for both a realty and a bank) I think lending is going to continue getting tougher and that is going to make prices continue to fall during the autumn and winter coming. I don't think we will see 4% to 6% increases annually for many years to come. All these foreclosed former owners are prohibited from buying for years to come. The upside is that rents are going to go up over the next few years faster than the prices of homes. If you are planning to hold the home as a long term investment, consider capital gains rate when you sell it. If you are planning to live in it, you can then rent it for less than two years before you sell it and avoid capital gains tax. So I think whether you want to live there might be part of your considerations in buying it.
Nice area, within an IB public school program which is a huge plus to maintaining or increasing property value.
I would like to advise you more and assist you in buying the home. I can do so by registering with you as your agent with the seller. Please give me a cal at 408-639-0211
Mitchell Pearce
408-639-0211
0 votes Thank Flag Link Wed May 4, 2011
Hello Santoso~

I am going to say that the market is changing but as we have witnessed there is not a real sure answer.
We seem to be in an up swing in the bay area, but with the short sells and bank owned very much a part
of this market it will be hard to speculate an appreciate future value. We are all in hopes this is the bottom but the fact is it will take 2-5 years to be any where close to seeing anything like the 2001-2007 crazy climb in values if at all. If the rates continue to stay rather low, I feel the market will be stable. The lower ends will continue to receive the multiple offers since they are short sells, bank owned or priced well. The higher end seems to be stable receiving multiple offers if price correctly and had enough equity to get a few dollars to boot. The future, we are all in hopes will be stable and continue to stay at least this way with a bit of equity involved.

Perhaps more agents will have some input one way or another but we do not have a crystal ball per say. It is a good time for low rates and sellers are willing to negotiate so that would be the only advise I would offer. If you like this property and find it fits your future needs go for it. Taylor St is busy but an added bonus being near down town and the university campus, so you should not have any problem renting out. Let me know if you need any help other than all the other opinions you will receive.

Denise A. Szyszlo Realtor
DRE 01441160
Office:: (408) 369-2000 x319
Mobile: (408) 768-7097
Fax: (888) 334-0888
Email: denise.szyszlo@century21.com
Web Reference: http://www.DazzleHomes.com
0 votes Thank Flag Link Wed May 4, 2011
Hi Santoso,
I am not sure if anyone can tell you what will happen with the market in 4 or 5 years. All you can do is buy a property at the low market price and hope it will appreciate in a few years. At that time, you can sell it and make money. In addition to that, if you can break even or make some money when you rent it out, you are in good shape.
Best of luck,
0 votes Thank Flag Link Wed May 4, 2011
Hi Santoso,

First of all, William Lyons is a reputation builder. It is centrally located near everything. You can walk a few blocks to go to Japan town or drive a few minutes to work (depending who you are working for).
Secondly, if you give it 5-6 years time frame, I'm sure you will have some equity in your home. So, if you would like me to come down to the sale office with you tomorrow to register, please don't hesitate to contact me at 408-426-1441.

Ciao
Web Reference: http://Www.4reohomes.us
0 votes Thank Flag Link Wed May 4, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer