by Gary Belk | Jul 21, 2011 | Blog, San Francisco Real Estate |
In San Francisco real estate, it’s hard to find investment property that will cash-flow positive or break-even. But with the decrease in property prices, low interest rates, and the increase in rental rates, it has now become possible. I have searched the San Francisco real estate for the best deals, and all of the properties I’m currently recommending are San Francisco condominiums that are in the ‘short sale’ process. A ‘short sale’ is a property sale where the proceeds fall short of the balance owed on the property. It typically occurs when an owner cannot make the mortgage payments on their property, but the lender decides that selling the property at a moderate loss is better than foreclosing, which involves hefty fees for the bank. The investment strategy for such properties will depend on your needs. San Francisco real estate has very significant upside potential and is being sold at levels well below value and in some cases close to prices that occurred in 2000. There are few new San Francisco condo construction projects scheduled to be built in the near future, so inventories should continue to decline and remain at close to absorption rate for several years. With the condo inventory decreasing, price increases should follow. I like San Francisco condos as an investment for several other reasons: San Francisco condos are not subject to the same rent control laws that San Francisco multi-unit buildings are encumbered with, so rents can be kept at market rate. San Francisco condos are usually easier to maintain as they have an HOA to maintain the grounds, exterior and other common structural...
