Sixty-four percent of investors who worked with a Realtor in California indicated they are going to keep the property for more than a year, while 36% of investors intend to
CAR found the median sales price of an investment property was $272,500 and that more than eight out of every 10 investors made repairs to their investment properties, spending a median of $10,000, or 4% of the median sales price on this.
Investors spent 4.2% of the sales price rehabilitating properties costing $250,000 but just 3.4% of the sales price when it came to rehabs of properties costing $500,000 or more, according to the survey.
Seventy-eight percent of transactions involved single-family homes, multifamily properties accounted for 14%, 7% were other property types and bulk sales represented only 1%.
Reasons to buy broke down as follows: profit potential (34%), good price (26%), low interest rates (10%), personal reasons (6%) and location (4%).
The median rate of return was 14%, more than 67% paid cash, foreign investors—primarily from China, India and Mexico—made up 27% of buyers, 75% plan to keep the property for less than six years, and more than two-thirds of the properties are managed by owners rather than professionally managed.
Three-fourths of investors own one to 10 properties. Fifteen percent own one property while 46% own two to five properties and 16% own six to 10 properties.
