Where is the cash flow?

[Justi Kobilis]

Okay everyone! You've probably all heard this one before and I apologize for the repeat but...Where is everyone seeing the best cash flow returns on properties in the current market? I've looked in several places around the country and while a 1% rent to value is reasonably good if you have appreciation, I do not want to count on appreciation, especially in the pre-recession market we are in! Anyone seeing 1.5% to 2.0% in low crime/decent school areas anywhere, $40K to $80K properties, SFR to fourplexes?

Thanks to all, happy holidays!

Justin Kobilis/California

[Bill Goodland]

This has probably been asked 100 times on the forums. In general, the south and mid-west seem to be the best cash flow plays. Rural markets often have strong rent to value ratios, but not a ton of buyers like a city. So if your plan is to refi out, ARVs can be tough to estimate not to mention finding qualified people to manage and complete contractor work on your properties.

Some cities, on the other hand, may have strong rent to value, but there is usually a reason the properties are cheap. Usually due to high crime. Best thing is to find a solid balance, invest in what you're comfortable with and ideally find boots on the ground of these markets with people you can trust.

Check out some of the podcasts on investing out of state and specifically @David Greene 's book on Long Distance Real Estate investing. He talks about some of the markets he invests in and more importantly the systems put in place to make your investing a success. Best of luck.