If you’re somewhat new to investing, you might well be a bit overwhelmed by all the possibilities, and by all the details you need to understand. Investment property in San Diego is plentiful, so you’ll have a wide range of options open to you when you’re ready. Below you’ll find some tips for the property investor, and a description of some of your best options.
Condominiums
One thing you’ll love about investing in a condo is that it requires little maintenance, while you also receive a high-level cash flow. Most condos are governed by Home Owners’ Associations, and that relieves you of some of the burdens of maintenance, as well as monitoring tenant behavior. One of the few requirements of owning a condo is simply maintaining good relationships with other tenants so that repairs and maintenance can be easily carried out.
Multi-Family Rentals
As property investment opportunities go, this is one of the more lucrative ones. For many investors, this might even be the best property investment available. That’s because you instantly get a consistent cash flow from tenants, even if one or two living units remain unoccupied. Of course, even with this golden opportunity, there are some downsides. You’ll be responsible for all maintenance and repairs, and you have to keep shared areas in great condition, or you’ll have multiple complaints from tenants. It may also be necessary to mediate disputes between tenants and to resolve any differences of opinion that pop up.
Single-Family Units
This is probably the most common approach for a new investor to take, because it’s fairly simple in nature, and it can school you about how to manage a property before you proceed to bigger investments. The drawback to investing in a single-family residence is that you have only one tenant, and if that single-tenant is unruly or constantly making late rental payments, it could develop into a major hassle for you. However, it’s relatively easy to manage, and it’s a good way to cut your teeth on buying a San Diego rental property.
Commercial Property
Some of the advantages of investing in commercial property include a steady cash flow, high appreciation value, and relatively high equity. On the other hand, this generally calls for a significant initial investment, and the returns may not be immediately forthcoming. There is also the risk of inflation impacting your investment, as well as liquidity and default risks, and even credit risks.
Vacation Property
This can be a great option for a new investor, partly because it offers the opportunity for immediate significant income. The disadvantage of owning a vacation property is that it will be used by many tenants, even in a short period of time, and that increases the risk of property damage. When you’re inspecting a potential San Diego investment property like this, make sure it’s in great shape to start with, before renting it out. Like a single-family residence, it’s only one unit you have to look out for, but even that could be problematic if you get just one bad occupant.