Sacramento

[minkathebest]

I am looking at a property and the rental income is expected to be ~1,000 and the cash flow with expenses is about 2500 yearly. If the property is priced at 130,000 and so with 20% down I will pay 26,000. The cash on cash return will be 9%.

Is this worth investing in?

Here is the listing that I am considering: http://www.redfin.com/CA/Sacramento/2768-42nd-St-95817/home/19419933

[pourdemain]

The house (IMO) is over-priced. You can spend way less in that same area. South of 2nd ave (and especcialy south of Brodway) is not as nice as north of 2nd ave. If that thouse were north of 2nd ave then you're talking.

[NorCalRealtor]

It depends on your tolerence level on what type of tenants you want to have. As mentioned in a previous reply you are looking in a not so nice area which normally will result in a not so nice tenant. If you have a property manager who will be dealing with your tenants and you feel confident in what you have set in place for what type fo tenants you will allow into the property and that your proeprty manager will follow your instruction your cash flow is a decent retunr on your investment. 

It maybe worth spending a little more and haveing a 6-7% return in a better area...

[gcuffe]

You should check into the 95841 zip code. A 3br can rent for 1100 per month and you can find a home in the 110k price range.

They are selling fast in that price range but they are out there. It is sad to think that at the end of 2011, I could find homes in the 75k range in the 95842 zip code. 

http://www.thesacramentohomes.com/

http://www.mortgagecompanyinsacramento.com/  is a good place to get a non owner occupied loan.