Depends on what you determine to be good investment properties. San Francisco is not a cash flow city. I have seen properties listed at nice/increasing cap rates, but when you break down realistic expenses then you are not going to have solid cash flow. The Bay Area investment landscape still really is based on the assumption of price appreciation.
However, when you get into the 1.5-2.5 Million dollar range you can pick up 8-16 unit apartment buildings that can have solid cash flow. In that respect, I'd say your best bet is going to be West San Jose because you can find solid cash flow and also be in an area that has price appreciation potential.
Feel free to shoot me an email at firstname.lastname@example.org if you would like to discuss.
Prudential CA Realty
One Daniel Burnham Ct. #260C
San Francisco, CA 94109
415 728 5580
Apart from the math, you have to consider local regulations when purchasing residential investment property. San Francisco, Berkeley, and Oakland, for example, all have widely differing rent control laws. In San Francisco, where the laws have become so onerous over the last ten years, many property owners have converted their multi-family buildings into Tenancies-In-Common and then sold individual units as a way out of the rental business. My advice is that before you speak to Realtor about actually purchasing an investment property, you seek the counsel of either a competition land use or landlord attorney in the specific cities youâ€™re considering. You may find names of such on my website under the â€œResident Resourcesâ€ tab.
Best of success to you,
Sothebyâ€™s International Realty
If you are talking about buying property to hold and rent and be cash flow positive on the rent vs expenses, it's tough but not impossible. While rents are high in San Francisco so are prices, and as you move away from the city and prices get lower so does demand.
Over the last couple of years I have seen a number of properties that work, most notably two duplexes that I personally bought, remodeled, and immediately sold. A large part of the mix in determining to go ahead with those projects was the determination that if for some reason we couldn't sell the properties they would be cash flow positive if we had to rent.
It's much trickier in San Francisco and other areas where they have just cause evictions but it can be done. Contact info is below if you would like to dicuss it offline.
Lance King/Managing Broker