Rental Basics in Sacramento>Question Details

Hazel0982, Renter in Concord, CA

Rental Property - Worth buying a house and renting it out in Sac?

Asked by Hazel0982, Concord, CA Wed Jun 13, 2012

I've found some houses in Natomas and Laguna area I am interested in purchasing and renting out. However, will it be hard to rent out a house in those areas or in Sacramento in general? Initially, how long would it take to find renters?

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I think most investors are finding that those areas are renting well. If you are obtaining a mortgage then you can calcualte whether or not it makes sense financially. Many people are losing their homes so renters are abundant. If you have a nice home at the right price it should rent. Consult with a Realtor and you will quickly see that buying a rental in this market makes sense!
0 votes Thank Flag Link Wed Jun 13, 2012
As many of my colleagues have pointed out. A relatively new home (e.g. < 10 years old) in a reasonably good condition at a reasonable rent, should get tenanted pretty quickly. Bear in mind, that even though you can get a leasing agreement signed within 4-6 weeks or so, tenant usually still have to give notice to previous landlord. So the actual move in date may take longer than 4 weeks, unless tenant is willing to pay double rent (at least for the overlapping period). Occasionally, you may get people who have done a shortsale or gone through a foreclosure looking for rentals. They may be able to move in quicker.

Try to find a property management company in the vicinity of the home your are buying. They are more willing to show your home to prospects.

Since inventory is quite low, to get a winning bid, your offer must be competitive. There will be multiple offers on desirable properties. Your rental yield should still be higher than the mortgage interest you are paying. You should be able to get a positive cash flow.

If you need any help finding a home, please let me know, I will be happy to help and/or provide you pointers.
0 votes Thank Flag Link Wed Jun 13, 2012

As others have said, those areas are pretty hot and you won't have much trouble renting them out.

However, keep in mind that most of the inventory out there will need some work.. I'm speaking primarily of the usual... new interior paint, maybe some new carpet... a good cleaning... etc..

Please also keep in mind that as an investor curb appeal is important too. So, if the candidate you are thinking of buying needs some landscape work and maybe an exterior paint job..? Don't let that stop you from making that deal... Especially if it's in a good area near lots of amenities like parks, trails and schools.

By the way....The new home builders up here haven't kept up with the inventory needed and that's just a function of the current employment picture here. Therefore it's only a matter of time before you see an explosion of prices both in sales prices and rental prices.

I hope this helps...

In the mean time...?

Make it a Great Day...!!!
0 votes Thank Flag Link Wed Jun 13, 2012
inventory is low for homes to buy,and homes to rent provided they are in good condition and the rents are within reason.

I would suggest, if you've never been a property manager before, to go to the RHA- Rental Housing Association and take classes. Even if you plan on hiring a property manager to handle your rentals, it's a good idea to understand the laws, and hwo to successfully own rental properties.

I thoroughly recommend real estate as the best investment in this market.
0 votes Thank Flag Link Wed Jun 13, 2012
If I plan to go through a property management company, do you recommend taking the class?
Flag Wed Jun 13, 2012
I have helped many of my investors acquire properties in these areas that provide better than average returns. In each case, the homes have been rented in less than 30 days (usually 2 weeks or less). The formula is simple and it makes sense. If you need any help contact me. I have plenty of current and past clients who have done exactly what you are attempting to do and you can ask them directly how it has worked for them.

Kevin Cooper
Cooper & Associates Realty
0 votes Thank Flag Link Wed Jun 13, 2012
Like everything it is a matter of matching price to demand.
You will want to do a rental survey to establish vaue. I would
imagine you will be employing a property manager due to
your distance, so I would rely upon them to give you advise
on the rental market. Remember if you over price, you may
never make up the financial loss of having a property vacant
for a month.
0 votes Thank Flag Link Wed Jun 13, 2012
There are people needing rentals in those areas due to the fact a lot of people are unable to buy right now because of for closures or short sales.
If you need any help finding a home please contact me
phone # 916-745-2093
0 votes Thank Flag Link Wed Jun 13, 2012
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