What stops someone from buying houses with mortgages and having the tenants pay the rents? Why not do this with 50 houses?
“OPM” or Other People’s Money is not available like it was pre-2008. Add to that, the markets with high rents also have high sales prices, so the equations don’t always compute short-term anymore. If you want to be a landlord in today’s market, you may need to keep the property quite a while to see substantial appreciation and make a return. Unless you were the fortunate few who invested in Malibu Beach or Bel Air, CA last year. The appreciation in those two markets were 56% and 33% respectively. That is why I encourage my clients to buy “quality” over “quantity” in the trending LA housing market.
Check out these latest market results:
- Average sale price in Malibu Beach: $10,963,500 – a 56% gain (or approx. $4,606,500)
- Average sale price in Malibu: $3,871,238 – a 47% gain (or approx. $1,207,190)
- Average sale price in Bel Air – Holmby Hills: $6,184,713 – a 33% gain (or approx. $1,877,062)