Best markets in 2022 for a new investor?

Question

I'm getting ready to sell my first live in flip house in Portland, OR. When the sale finalizes, I want to take my equity (little over 100k) and start BRRRR investing in a new city. What are some real estate markets that would be good to get into? I'm thinking I might get good bang for my buck in Oklahoma City or somewhere in the Midwest where houses are cheap. Your input is greatly appreciated!

Jayson Cain · Answer

If you're looking mainly for cashflow, markets in the Midwest are great. Below are some metros where our investors currently buy properties for long-term rentals:

• Columbus, OH
• Memphis, TN
• South Bend, IN
• Baltimore, MD
• Allentown, PA
• Pittsburg, PA
• Jacksonville, FL
• Orlando, FL

Let me know if you need to make connections in those markets. I'd be happy to make introductions for you. I personally invest in Indianapolis, IN for my own portfolio so if you have any interest in that area as well, I'd be happy to connect you with great vendors that helped me add 10+ doors last year.

Chad Olson · Answer

Depends on what you are looking for. If you're looking for cash flow, the Midwest is full of small to midsize town where you can find 1% rule properties (and occasionally 2% rule).  BRRRRing can be a little dicey with the cost of supplies having risen exponentially; even so, there are abundant opportunities in college towns throughout Minnesota and Wisconsin.

Cassi Justiz · Answer

@Artie Butcher,

Congratulations on your first live-in flip! That's an awesome place to start!I'm based out of OKC. Our market has seen a ton of growth lately, and with that has come with a significant increase in pricing and decrease in returns. BRRRR deals are still possible, but they are very few and far between for anyone that isn't doing their own direct to seller marketing. In order to acquire a BRRRR deal here, you'll need to get comfortable with working directly with sellers. Occasionally a wholesaler will send out something with those kinds of margins, but it's exceedingly rare in our current climate.

I'd narrow down your criteria of what you are looking for in a city and then start looking for connections in those areas. Do you want a city with specific population growth metrics, job types, etc? Do you care about A,B,C,D class areas? Crime rates, etc? You'll also want to look into local landlord laws and any proposed changes to those laws. BRRRR strategy can be a great option, but it definitely requires a little more front end work than buying turn key or purchasing in your home market.

Joshua Janus · Answer

Columbus, Ohio creates an opportunity for a great hybrid mix of cash flow and appreciation. There are great A-B class neighborhoods where STR do great.

Nick Giulioni · Answer

Hi Artie, congratulations on your first live in flip! I'm into flipping too. I have started my RE jouney here in Indianapolis. Now, I have almost a hundred doors. I would love to share my experiences and chat you more if you're interested.

Robert E Thompson · Answer

Artie, I have been looking around in out-of-state markets.  This is an article from First American's economic center that I found interesting.  I have a few other articles running around but will have to find them.  Oklahoma City and some midwest cities are on this particular list.  I'll see what else I can track down and send it to you.

David Ginn · Answer

Hi @Artie ButcherMy advice is that you have to first understand where the market is. I strongly recommend that you don't buy a long-term holding investment. The smarter move is if you want passive income, is to go in and lend your money. Our buyers pay 12% interest and 3.75 points to you as an investor. We are Buyers, Lenders, and Mentors, a tight-knit group and we work together to make money for our deals. So it gets your points of interest directly shared. That's my advice for you as far as in this particular market.Good Luck.

David Ginn · Answer

Hi @Artie ButcherMy advice is that you have to first understand where the market is. I strongly recommend that you don't buy a long-term holding investment. The smarter move is if you want passive income, is to go in and lend your money. Our buyers pay 12% interest and 3.75 points to you as an investor. We are Buyers, Lenders, and Mentors, a tight-knit group and we work together to make money for our deals. So it gets your points of interest directly shared. I say this because when you rent you're renting to invest you're renting to people who can't buy their credit is bad. And also if the market corrects back you're going to lose equities and so this is really not the time to buy and rent that’s my advice for you as far as in this particular market.Good Luck.

Zac Lindquist · Answer

Hey Artie,

I am a realtor/investor also in Portland. I am also about to sell my first duplex and am going to 1031 into the AZ market. I am not doing the BRRRR like yourself, but AZ has been crazy as a whole!

I found an great lender with an amazing loan product that applies to the western states. 10% down, no mortgage insurance, and a 15 year balloon payment that you refi out of way before it gets to that point! If you want their info please let me know or if you have questions about the selling your home I'd be glad to help!

Brenden Mitchum · Answer

Hey @Artie Butcher, welcome to the BP community!

Congrats on the successful flip!

Here's a recent post that I think would help you as you start your search!

Best markets in 2022 for a new investor?

Most Popular Reply