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Small-time investors having big effect on housing market

Small-time investors having big effect on housing market

By Ron Trujillo/

As bidding wars and multiple offers continue to dominate in many markets in the state, much of the competition is coming from investors rather than traditional homebuyers.

Last year, almost two of every four homes (37%) nationwide were bought by owners who didn’t live in them, according to ATTOM Data Solutions and Clear Capital. The buyers aren’t private-equity firms, which accounted for 7.8% of purchases in 2012, but small-time investors.

These individual investors, often homeowners who have paid off their mortgage or with small monthly payments, are looking for a solid investment for retirement. Many of these investors are looking in lower-priced markets, but that’s not always the case in California, according to the data-driven report.

In fact, some of the more high-priced markets, including San Francisco, are attracting the most attention. The following is a look at the percentage of investors of single-family homes in 12 cities in 2016:

Anaheim: 21.6%
Bakersfield 43.0%
Fresno: 58.0%
Los Angeles 40.1%
Modesto: 33.9%
Redding: 28.2%
Riverside: 21.7%
Sacramento: 35.6%
San Diego: 48.4%
San Francisco: 19.4%
San Luis Obispo: 34.8%
Santa Rosa: 28.2%

Please note, the percentages listed above are for random ZIP codes in the particular city. For example, San Francisco had some neighborhoods where more than 35% of homes bought were by investors. But I chose the first ZIP code that was listed in the search.

You can check out a city-by-city investor-owned heat map here.

Find your happy place

Santa Cruz, with its laid-back approach to life and scenic ocean views, finished third in the nation in the Community Well-Being Rankings by Gallup-Healthways.

The beachside city, about 45 minutes and a world away from the fast-paced lifestyle of Silicon Valley, finished in the top 10 for community, physical, purpose and financial rankings of the annual report. The community finished at No. 20 in social ranking.

Dan Witters, research director for the survey, told the New York Times that Santa Cruz ranked first in the nation on one question critical to overall well-being: three of every four people said they “learn or do something interesting everyday. That’s a real vanguard of high well-being cities, and they knock it out of the park.”

San Luis Obispo, perfectly placed on the Central Coast about three hours from Los Angeles and San Francisco, finished in seventh-place on the national list. The city finished second in community rank and fifth in social rank.

For the annual ranking, researchers conducted more than 350,000 phone interviews nationally in 2015 and 2016. People were asked about their cities, jobs, health and social lives.

“Innovative leaders are transforming their communities to create improvements in how people socialize, work, eat, play and move,” says Michael Acker, general manager of the Blue Zones Project at Healthways. “These changes are empowering citizens to make healthier choices, be more productive and have better quality of life. Employers, health systems and community leaders are poised to create positive change by promoting meaningful and measurable actions towards better well-being.”

Santa Barbara County (Santa Barbara to Santa Maria) finished at No. 12, Santa Rosa (No. 17) and Salinas (No. 19) on the national list. San Diego and Visalia-Porterville finished at Nos. 22 and 25, respectively.

California cities fared rather well on the annual list, but Chico – a college-dominated community about 90 miles north of Sacramento – finished at No. 183 on the 189-city list.

So, what cities are better than Santa Cruz? Naples, Fla., and Barnstable, Mass. (think Cape Cod).

Photo by Andrew Zarivny/Shutterstock

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