Birmingham or Raleigh or Wait

[Angela Davis]

Hello BP friends. I recently joined the community and planned to start my 1st investment. Please see below for more details and happy to hear your thoughts!

Current Status: Sample picked few SFH in Birmingham and Raleigh--> Resulted (-$2,000) ~ (-$6,000) CF yearly

My Goal: 

- Positive Cash Flow > Break Even CF > Appreciation 

- No BRRRR at this time since it will be 1st time

Current Challenge: 6.375% with 30% down payment (consider the high rate impact the CF directly) 

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Questions:

1. Location: Birmingham or Raleigh? Any advice?

1.1: If Birmingham, any area recommendation? 

1.2: Any other location recommendation is welcomed!

2. Based on the current market condition and high rate, would you suggest actively looking or starting some book reading instead? 

Thank you!

[Pat Lulewicz]

I do not invest in Birmingham, nor do I know much about it. I had previously looked at multi-family there and it seemed to pencil. With that being said, my understanding is that Birmingham will be more of a cash-flow market. As a Raleigh investor and Realtor, I can confidently say that Raleigh is not a cash flow market on Y1 rents...at least not from an LTR perspective. MTRs and STRs will get you there. If we find you a break-even LTR deal, you crushed it. We're a 2% CoC Y1 at best, but you will also enjoy the hyper-growth that has come in this market, so safe to say the Triangle is an appreciation play or patient capital as your rent rises for the next 5 years to get you to a cash flowing property.

If you want a good cash-flow market that's attainable from a price perspective and growing, take a look at Greensboro, High Point and Winston Salem (collectively the Triad). We have great deals here across any tenant class and property type.

Bonus: IF you do choose to invest in North Carolina, reach out to me about your lender downpayment situation. We have a local bank that I work with that does 15% downpayment, NO PMI investor loans between 6.375% - 6.875%