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Whitelaw and Sons Real Estate Morgan Hill
Whitelaw and Sons Real Estate Morgan Hill

California real estate a lost cause for investors? 3 Reasons

by Dec 19, 2020Real Estate Realities Podcast/Vidcast0 comments

Time To Quit California Real Estate

Written by Robert Whitelaw, Realtor®/Broker/Owner

Born and raised in Silicon Valley, Robert has helped clients successfully buy, sell and invest in real estate from Palo Alto to Gilroy and Los Gatos - and beyond! Robert rates his success on providing the highest level of value to his clients.

December 19, 2020

Will California real estate be at risk with companies and residents fleeing?

Table Of Contents

  1. Podcast Summary
  2. Linked News Stories

 

California real estate has been a hot investment option for decades. The reason is the sheer number of people that are drawn here by the natural beauty of California but also its robust employment opportunities.

That landscape is changing. With the growing acceptance of working from home, workers – more than half of them – are looking for the exit. In todays show, we are going to look at a few of the realities that have shifted as companies like Oracle flee California and a majority of people living here would move if they could – and with working from home options becoming more accepted, they can.

Nothing lasts forever and all markets eventually rise and fall, then rise again. California real estate is a perfect example of that.

For the time being, the situation looks like real estate investing in California carries with it risks that are based in politics, taxation and more and more indicators that the legal system is interested in doing more and more to reduce landlord property rights.

While many have been willing to accept the existing risks associated with California Real Estate for the benefits that appreciation offers – that benefit is looking strong at the moment, but things are in motion that also indicate that a healthy level of concern regarding the future of the real estate market is in order.

So where does that leave us when there are other markets that offer less appreciation but better control over the property and less interference from state government? After all, if the state can dictate who you can rent to and whether or not you can evict for non-payment is it a safer and ultimately more profitable bet to look elsewhere to invest in real estate?

There are a number of areas outside California where the argument can be made that investing in those areas instead of California makes a great deal more sense.

Find below a few interesting articles that I cover in todays show. However, keep in mind that this is really just the tip of the iceberg. In addition to the concerns we talk about today, we need to also recall that lending practices today look very similar to the time leading up to the downturn.

As more people accumulate debt they cannot hope to manage, the chances of a crash, not just in California real estate, becomes more likely. Just as happened last time, there will be markets that are less effected – but California real estate will likely be more strongly hit, as was the case last time.

Join me in taking a closer look at some of these concerning issues. I would also love to hear from you. What would you like me to cover in future shows? Where do you think I am getting things wrong? The goal is always to get as close to the current truth on the ground as well as trying to figure out what the most likely outcomes will be over the next year.

While I am looking at areas outside California real estate, it is also good to keep in mind that there are parts of California that are still very good investments that show a great deal of potential growth. But even these areas will still carry with them the trend of eroding your rights as a real estate investor. Which requires all of us to consider if taking those kinds of risks makes sense when there are so many other areas that continue to respect an investors property rights.

Interesting Articles:

 

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