If you could start investing in real estate anywhere in the US, where would it be?

Question

Hey BP-ers!

I currently work as a consultant, and have the flexibility of living mostly anywhere in the lower 48. Aside from my day job, I'm interested in getting started in real estate investing - my current thought is to find a good market and 'househack' a duplex/triplex/quad as my first investment (and slowly build upon my portfolio of Buy&Hold properties while I work).

I'm interested in hearing your thoughts on where you would start your real estate careers - what markets and why?

Just a note - I love the outdoors, I prefer to live near the ocean (i'm from NJ after all!) and it's 100% essential that there's an airport nearby (for work).

Looking forward to your thoughts!

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Jay Hinrichs · Answer

Greg N.

Manhattan Beach,  LAX is 10 minutes away and need I say more about CA beach's

If you like more out doors stuff like hunting and fishing  Oregon coast has some well priced close proximity to water properties.. and 1 hour to pdx  Northern Cal Coast is Awesome up by the redwood areas  but kind of remote.  Puget sound is awesome you can buy on one of the Islands in the Sound and take a ferry over to SeaTac.. etc etc.

Charleston SC  30 minute flight to Atlanta and you can get any where you want.. much up side in Charleston  surrounded by water big long beaches.. college town etc etc.

I suspect many places in Florida would work.. Like fort Meyers   well priced properties there if you can handle the heat.

Mississippi gulf coast has lots of opportunites in RE... along with New Oreleans Houston as well.. then there is the north east don't know those areas but there should be some

Jay Hinrichs · Answer

Greg N.

as Paul Stated WA has no state income tax... Oregon has state income tax but no sales tax.  you can live right across the river in Vancouver pay no state income tax and shop in Oregon sales tax free.. Many of the big box stores their top 5 in sales are right across the border in Oregon...  CA is heavy tax burden but it does not get any finer for a young man on the go !!

Paul Ewing · Answer

I did it for close to 20 years.  It is fun at first, but does start to get old after awhile especially since it has gotten much harder and more unpleasant to travel especially in the US.   Depending on your amount of travel time it can be very difficult to be very actively involved in REI or much of anything at home.   In 2006 I was in the US 26 days total and nine of them were working in Chicago.  Two years ago I switched to working with a new client (first contract now employee) where I can work from home.  Their contract with the state has another two or maybe three years before it is taken over by another company so that is my transition point to full time farmer and REI since they are the last customer of my old company's software in the US and I would have to start traveling again if I stayed corporate.

As for the tailoring your investment to the market, some markets may be better for buy and hold or flips like you said, but even within those categories there are a lot of sub markets.  For example I specialize in rural homes on acreage.  Mostly mobile homes but some smaller stick built homes.  I get good rents for reasonable purchase prices from people that are looking for some place to put down roots by planting gardens, having a few animals or chickens and stay for much longer terms than average for in town homes.  If I lived by the coast I would look at the vacation rental market a lot.  Some places may support fix and flips of high value homes or some may have lots of cheap run down homes in Class C - D neighborhoods that may be worth looking at rehabbing a block of.

Tom Kelly · Answer

Having moved from Middletown, NJ to Tampa, may I suggest Florida?

The beaches are great and the water is warm. Housing is much less

expensive than in NJ and the property tax is a  bargain in comparison!

And did I mention that there is no state income tax?

Lot's of distressed and foreclosures.

Greg N. · Answer

@Joe Villeneuve - thanks for the hint of wisdom. I definitely agree with your points, especially about investing 'where you live.' I would be way more comfortable investing where I am now, but truth is, i'm trying to experience something different! I truly hope the right market picks me - which is going to take a lot of careful research.

@Jay Hinrichs - Manhattan Beach definitely sounds great, but I think it's a bit too expensive for my first place. I'm definitely going to look into Oregon and Charleston - I love the history/charm of Charleston, but I have yet to check out Oregon. May have to take a quick trip up there to check it out - I've heard great things! Thanks for the suggestions.

@Paul Ewing - I really appreciate the fact that you know the road warrior lifestyle. While I love my work, I can't do the constant travel forever (hence my motivation to get into REI). I didn't take into account state income tax, which will definitely pay a HUGE factor in my criteria (thank you!). About your last point on strategies/styles to match local situations - could you elaborate a bit more on this? Are you saying that it may be better to Buy&hold in one market and fix/flip in another?

Paul Ewing · Answer

I was in a similar situation back 20 years ago when I started computer consulting.  I chose to stay in the Dallas/Ft Worth area because I knew it and I could get to just about anywhere in the world in 2-3 hops with most major financial cents a direct flight.  Plus with no state income tax it is a much better base of operations than some high tax areas.  Other people chose Florida and Washington for similar reasons with not too much worse flight options.  Now DFW doesn't have ocean which could be an issue but it is a short flight to them.  I think you can probably make a good start in investing in just about anywhere if you look hard enough but you may need to use different strategies and styles to match the local situations.

Joe Villeneuve · Answer

There are any number of answers, but investing "where you live" because you are familiar with it isn't a correct answer...at least not based on the fact you know the market.  Knowing that market is critical to picking your investment market, but investing in a market simply because you know it isn't.  The knowledge you have of that market should tell you if you should invest there.  If the market you live in stinks, don't invest there.  When you find a market "that tells you to invest there", then learn about that market like it was in your backyard.

My personal pick, would be southeast Michigan...but that's from experience...and I'm a little bias.

Keep this thought in mind:  You don't pick the market, the market picks you.

If you could start investing in real estate anywhere in the US, where would it be?

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