An affordable alternative to Silicon Valley

This week, we chatted with Pratik Pathapati at Rework Cash Offers about Sacramento, CA.

Average home price: $479,766 (down 2.5% YoY)
Homes that sell over list price: 38.1%
Homes that sell under list price: 47.2%
Average rent: $1,995/month

How he got started: “I helped flippers find deals and partnered with them on houses to learn how it all works before doing it on my own.”

His market’s pros: California’s capital remains a seller’s market with a healthy demand from buyers, “especially from people relocating from more expensive regions like the Bay Area,” says Pathapti. He recently bought a home for $295k, expects to spend $50k on renovations and $30k on closing costs and other expenses, then hopes to sell it for $400k, for a $30–$40k profit.

The cons: “Inventory is tight, so finding good deals can be difficult,” he says. “You won’t be able to search on the MLS and find turnkey cash-flowing homes.”

His advice: Shop off-market for bargains by searching public records for properties with code violations, tax liens, or in pre-foreclosure. “Look for value-add deals where you can go in and improve the property to force appreciation,” he says.

Got a home or housing market you want to highlight in The Playbook? Tell us more about it here, and we’ll consider featuring it in an upcoming issue.