For a lot of people, when they think about purchasing a home – it’s about building a family and putting down roots. For others, it can be more for investment reasons. In San Diego, the property market is incredibly competitive, which means that you could make a lot of money if you invest correctly. It also doesn’t need to be a long-term decision in that you could end up making your investment property your own and live there yourself serving a dual purpose. We have put a list of things you may need to consider if you are buying an investment property in San Diego.
Location is Important
One of the first things that people look for when purchasing a property is the location. Typically – people will have an ideal location in their head before they start viewing properties. However, it could be if the main objective is to settle down, that they can compromise on location if a home has all the features they require. If it is an investment property, and one of the main focuses is the resale of it – the location is incredibly important. As San Diego is a beach environment – then being next to the coast has its obvious advantages, and something that people will look for. If you have a home close to the sea, you will see an instant boost in value. You don’t need to be right by the beach (although those will be the most valuable) – but walking distance could be enough. Although the beaches are what San Diego is known for, they aren’t the only desirable areas. Downtown San Diego is also incredibly popular, and another potential lucrative investment is property near a college or school campus as well as other historical districts. Homes close to transport links are also a good idea.
The Layout and Building Structure
There are lots of things in a property that you can change. It isn’t a huge hassle to repaint a wall, to change some fixtures and fittings, or to get different flooring. The house layout is a different matter, however. The way the house flows in terms of whether certain sections are open plan or closed plan, or how small the rooms are, is something that’s much more difficult to change.
As the years have gone on – the trends have changed in terms of layout and structure. What used to be popular was room divisions, the open plan approach seems to be much more popular these days. A modern home won’t typically have larger bedrooms, spacious master bathrooms, or perhaps walk-in closets which are still desirable. As such, if you find a house that has features like that – you are more likely to make more money. You can often make structural changes such as knocking down a wall, however you need to understand that this would end up eating into your costs.
The Views from the Home
When you book a hotel, an added feature is a “room with a view”, which tends to cost more. It’s the same with houses, people see a house with a view as much more valuable. San Diego is incredibly scenic. There are lots of homes that can potentially have a beach or mountain view that will make great investment properties.
It could be that you need to buy a “fixer-upper” to nab one of these properties – but don’t let that put you off. If you find a fabulous home with a view, you will find that people will tend to sacrifice other amenities that they would normally go for.
The Cost of the House
Price is always something that is relevant irrespective of what the investment is. You should make sure that you have a clear budget in mind before you start viewing properties – and make the resolution to stick to it. You should also be in touch with banks if possible, to get a pre-approved mortgage or loan, so you have a firm idea as to what’s affordable or not. Whether the home is a long-term or short term is a consideration as this is where interest rates come into play. So, you need to have a clear idea as to how long you are going to keep the property or push a resale. A top tip is to be on the lookout for a house that is undervalued. If there are very minor fixes that are required, that can be easily fixed – then you could see the price of the home soar. It’s also critical that you don’t buy a house that has a ceiling price. Make sure that you never make an offer that is more than what the property has been valued in order to get a quick sale.
Whether or Not there are any Renovations Required
Generally, people understand that when you purchase a property for investment purposes – that there may be some renovations involved, before it’s rented out or sold on. People with construction backgrounds tend not to worry about fixer-uppers as they have the resources to make some alterations, not so easy for people who don’t have this. This is why it’s critical that you carefully evaluate what renovations are required. If a home needs a repaint for example, that should be a quick and affordable fix, and if you need to purchase new appliances for a kitchen or utility room – this also isn’t something that’s too problematic.
Other renovations could include the likes of some electrical work, plumbing work or even window replacements. Again, this doesn’t need to be too expensive and can also be an investment. There are window companies in San Diego such as American Vision Windows who offer a wide variety of products to suit style and budget.
What the Rest of the Neighbourhood is Like
For a real reflection on how good an opportunity it could be, make sure you take a look at the rest of the houses in the neighbourhood – and what the condition of those is. Check to see if they are also in good condition and have a look at what the saleable value of them are. There will be lots of historical data to let you know what other houses in the same street have been bought and sold for. This will be a good indicator for you as to whether or not you are making a profitable investment. If you find that there is lots of available houses on the same block, then this would also be unattractive prospect, as it could mean that the market is oversaturated. You also may want to avoid the best house on the street. The reality is this property is completely maxed out in terms of its potential which means there would be very little to be gained from that.
The property market in San Diego is booming, with properties increasing in value every year. The reality is that there is lots of money to be made, you just need to know where to look and what to look out for to maximise the potential.