Contra Costa Investment Property
Now, we take an inside look at the Contra Costa investment property we identified in Pleasant Hill and Walnut Creek in the previous posts.
To read the previous posts in this series, click here:
Investors Hear the Knock of Opportunity
I set out on a half rainy, half sunny day – typical of central Contra Costa County at this time of year. It had been raining like crazy for the past couple of days, but that just seemed to make things seem fresh and clean – a perfect backdrop for our early spring market and our first day looking at the properties themselves.
My first stop was 164 Elderwood Dr., Pleasant Hill, but it was really a no-show.
164 Elderwood Drive, Pleasant Hill - not bad from the outside. We may never know what the inside looks like!
It looks nice enough from the outside and I was anxious to see the inside, but the listing agent evidently wants to keep it all to themselves. No lockbox, voice mailbox completely full and unable to take any messages.
This is really a good subject for a separate blog post, but just let me say that there is no good reason to keep people who may want to buy your home from seeing the inside of your home! There are a lot of reasons why this is done, but they usually benefit the listing agent far more than they help the seller of the property.
Let’s go to 427 Bifrost Avenue, Pleasant Hill and leave it at that.
427 Bifrost Ave, Pleasant Hill - notice the location?
As you can see, this is a 4 bedroom home built in the mid-60’s. Good size, and on a nice, manageable lot. But what you cannot see from the MLS is that it is RIGHT ON THE CORNER of a main thoroughfare leading to not only a community college, but a high school and middle school as well!
The agent has done an excellent job of presenting the home, but there is nothing they can do about the location. This not only hurts the desirability to a renter, but will negatively impact your value when you decide to sell. Too bad – it was a lot of house for $474,950!
Hardwood floors are not my first choice for rental properties - for the Owner OR the Tenant! But this agent did all they could do to make the home show as good as possible. Too bad the location cannot be changed!
545 Maureen Lane, Pleasant Hill – one I almost eliminated in the first round – turned out to be better than I originally thought. Although it is clearly an REO (Real Estate Owned, in other words, owned by the bank) and will need a lot of work to get it in rental market shape, the location was not nearly as bad as I thought. 4 bedrooms, 2 baths, 1475 square feet on a surprisingly nice lot puts this one in the hunt!
It's hard to see in this photo, but the overall condition will require spit, polish, and a lot of paint!
335 Valley View Rd., Pleasant Hill is a 60-year old 3/2 (three bedrooms/ 2 baths) in one of the cutest parts of Pleasant Hill. Tree-lined, many updated neighbors, great school feeder pattern. This one will have a high desirability for potential renters!
Off to a good start...
However, it has only a one-car garage! That’s gonna hurt.
And the interior is not too terrific either – typical of a bank-owned previously foreclosed home. Appliances removed, weedy back yard, questionable heat and plumbing systems – all the stuff you find in these troubled times.
It saddens me to walk into a home where the former owner clearly put their heart, soul, and a lot of their family’s money into remodeling it – obviously intending to stay and live and enjoy – only to lose it in foreclosure. These are the skeletons of the booming Real Estate market, picked clean by economic forces none of us, not even the bankers who helped create them, were prepared for.
What began as updated cabinets, granite counters, and a lovely tile floor became a "Kitchen of Broken Dreams"
This one might be a good one. We’ll have to make a “to do” list and see what we come up with.
That brings us to 217 Ivywood Drive, Walnut Creek. This was the only Walnut Creek property to make the grade in our price range.
217 Ivywood Drive is a fifteen year old home on a very small lot compared to the others, but it is rather conveniently located near the Pleasant Hill BART station (which is actually in Walnut Creek – go figure!). It shows very well both inside and out.
The main drawback is that it feeds to somewhat poorly-performing schools and is located in a funny neighborhood of much older homes and large commercial areas.
Still, I would expect that this one would bring close to $2000 per month and does not need much work to put it in “rentable” shape.
If we were to choose this property, it would be a good idea to make sure the Homeowners Association (HOA) allowed for rentals and, if they do, we must remember to factor the extra $142 per month into our payment calculations.
Choosing a proper investment property is like any other investment – a very personal matter.
Here we have found three possibilities – each bringing different strengths and weaknesses to the discussion. The final choice depends on which weakness you are able to live with and which strength you feel you can capitalize on.
The next post will deal with financing, because investment property financing differs from owner-occupied loans as well.
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