Where to start my portfolio?

[Bret Halsey]

I've decided to look to buy my first true investment property in the near future and despite knowing how to run the numbers, I'm having a difficult time deciding where I should be looking to buy. I'm considering either a small multifamily (duplex or fourplex) or perhaps a single family that will be easy to rent and cash flow. Where I live is way too expensive to cash flow so I was thinking a landlord friendly state in the midwest, something with plenty of inventory for me to find a good deal but also strong rental demand. For those who invested out of state, how did you decide on your market? Where are some good areas I should check out?

[Nathan Gesner]

Quote from @Bret Halsey:

Dave Meyer has some really good data analysis to identify some of the best states/cities to invest in. If you can't find his articles (I think they are only for Pro Members) then you can look for his video on YouTube that recently covered this topic.

I tried looking in larger mid-west cities and they were swamped with investors paying over asking, all cash, no contingencies. It was ridiculous and doesn't make sense. I think these are mostly emotional buyers flush with equity thanks to the meteoric rise in housing prices. If the market corrects like many think it will, these people may end up over-leveraged and in trouble. Time will tell.

From what I've seen, you need to go outside the large cities to smaller cities where there's less competition and more opportunity. But then you run into the problem of finding a quality property manager or quality homes for sale.

It's a tough market. Don't give up, but be shrewd.