You could probably actually do investment loan. Not a bad deal either.
Very large lot, the only downside is a bit busy street. The house would probably rent for 6-7K max given its condition (i assume it’s not great), 6 * 12 * 6 = 420K presumed future income at constant rent. They bought for 2.3M. not too shabby.
Huh… i also visited Los Altos downtown Saturday morning. It was lively yet peaceful and i really liked it.
There was huge long line in my fovorite bakery.
What time did you visit?
With the recent price stagnation, not so sure. but otherwise, you are getting a couple hundred thousand discount. Not too significant, but not too shabby either.
This kind of deal suggests that many retirees prefer to stay put and live in the same house forever. So housing supply is low for desirable places for a reason.
Or as an investment for sure. I am still not clear on the full numbers though. Couldn’t find a recent comp on covington with 0.3+ acre lot size. Assuming 3M, this is 700K discount. 7K/month rent, 6 years = 500K already. No rent increase is assumed. Then there’s tax implications if the buyer decides to sell… so gets trickier?
I wouldn’t buy this as investment. You can buy 10 similar houses in Austin and collect a huge amount of rent. And Austin appreciation is higher than SF
BABG is right, never consider Los Altos for investment property like stocks, getting 25% up…Read about dot.com period and RE-downturn period. For investment property, cash flow is very important to sustain.
For rental investment, go for multiplex like 4 plex or more and at low cost locations.
I would prefer in this order (look at Gross Rent Multiplier).