How to find the right market for BRRR? Currently in Utah

Question

Hello, first post here!

Hoping to get some advice on how to choose a market to begin real estate investing? I currently own a home in Provo, UT. I live upstairs and rent out my basement. I am ready to take steps to purchase a second property, but wondering if the Utah market is too hot right now. Homes are being sold for 10's of thousands in cash over market value. I'd like to stay here, but wondering if it might just be the WRONG time to purchase here. It might make more sense to move somewhere else. How do you find the best markets for investing? Or any insight into if the Utah market is still possible for what I want to do?

I have about $20K in cash and about $100K equity in my home to work with. I would like to do BRRR with another duplex somewhere in Utah. I am fully committed to really getting started with REI and ready to hustle for the next few years to make it happen, even if that means moving somewhere else. Any advice would be great!

Joshua Noth · Answer

@Kathryn Smith Welcome to the site! I'm not ~quite~ in your area, but finding the best markets for investing can be a universal question, with some overlap in answer.  Defining your goals, niche, and timeline are important steps to have for yourself - it seems you have done some of this already, but you can go as specific as you want/need. Then, it's finding areas that meet those goals: if you want cash flow, look at markets that have that as an option: see what areas other locals mention, and then get in touch with a Realtor that works there to help you out further.  If it's appreciation, look larger trends, such as migration patterns to markets you are considering, company relocations, new developments, etc.

Hope that helps!

Zane Lyons · Answer

I’m brand new as well so take my insights with a grain of salt, but I definitely think Utah has a lot of opportunity still. Utah, Salt Lake, and Davis county themselves are *extremely* expensive given the size of the cities, but there are plenty of areas that still have more reasonable home prices. I would look into Weber county (Ogden area) or Cache county up around Logan. Still solid demand in these areas but prices are literally half of what they are in the counties 30 minutes away.

Dan Gustavson · Answer

Hey Kathryn - Congrats on the first post and welcome to BP. I'm in Herriman and am also searching for my second investment property. As you mentioned, the market here is crazy and it's made it hard to find deals. I receive half a dozen Utah wholesale deals daily in my inbox and even those don't come close to the 1% rule. For this reason, I have been looking out of state towards the mid-west, but have also thought about Texas. I lived in Utah my whole life and would love to stay investing locally, I just don't see it happening right now for me. My next property will be small multi-family and they are in short supply or insanely expensive in SLC. As mentioned above, you could probably make it happen outside of the Wasatch Front but even those valleys are getting expensive. I cannot believe how expensive the prices out in Tooele, Eagle Mtn, and Spanish Fork have gotten the last several years. Good luck!

Kerry Noble Jr · Answer

look into the midwest for sure

Dan Gustavson · Answer

@Logan M. - That's awesome! What is your strategy on finding these properties in SLC when the market is scorching hot.. if you don't mind me asking?

Logan M. · Answer

The best place to invest is always your own backyard because you know it best. There are opportunities in every market but just last year I picked up 13 units in Utah and 11 were seller financed, you can find deals anywhere! Did I mention all off market without any bidding wars?! :)

Stefan D. · Answer

@Kathryn Smith

Hi Kathryn,

Don't rule out going out of state.  Check out the Bigger Pockets books on Long Distance Real Estate Investing, or the BRRRR book - tons of great info there.  There's other forum posts on this site talking about investing in different cities, but generally in the rust belt, or the South / Southeast you'll be able to find cheaper homes - and importantly for BRRRR's - old houses that have a lot of deferred maintenance and are selling at a discount.

Account Closed · Answer

@Joe Funari I recently moved to Dallas and we’re looking for an investment property as well. Are there any areas you would suggest looking at? We’re currently trying to find something in frisco, Plano, Carrollton, and areas towards Northern Dallas. I know the PGA is opening up soon, do you feel that’s going to have a huge impact?

Becca Summers · Answer

@Kathryn Smith If your home is not a legal duplex I would be cautious about moving and renting both units. If you do make sure there is enough parking on-site off the road. That is when your neighborhood will turn you in. I love investing in Utah the cash flow is not what it is in other states but the appreciation and long-term wealth growth is awesome. What is your long-term plan? Use the cash flow to live or grow and roll up your portfolio.

How to find the right market for BRRR? Currently in Utah

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