Advice on purchasing in the Westgate area in Phoenix, AZ

[Patrick Walton]

Greetings BP community,

My name is Patrick and I am looking to begin an investing career in the Phoenix area. My wife and I purchased our current primary residence about 5 years ago with the intent of eventually turning it into a rental. We used my VA loan to purchase the house. With the current state of the market here in Phoenix, it feels like it is the right time to refinance out of the VA loan and start renting it out.

We are considering purchasing another new build in the Westgate area, using the VA loan again, and using the same strategy if living in the home for 2 -3 years and then turning that property I to another rental.

I am looking for any experienced advice from those familiar with the Phoenix market in regards to the Westgate area. It seems to me that it is a good area with lots of growth and good possibility of appreciation over the next few years.

However, I am concerned about cash flow once we transition it into a rental.

Any advice or thoughts would be very helpful and greatly appreciated.

I am new to BP and have been blown away by the community and the amount of education and knowledge available. I look forward to networking with and meeting other members in the future as I begin a new career in REI.

Thank you

[Bob Okenwa]

Hi @Patrick Walton

The Westgate area is growing as Top Golf has recently been built across the freeway and there is talk of a waterpark resort being built in that area in late 2022. 

Putting 0 down with the VA loan on a new build will hamper cash flow since it's getting harder to cash flow here without a significant down payment. Maybe the appreciation will help out some in 2-3 years, but I don't have a crystal ball to say how high rents will be in the future.

New construction in the area starts around the mid 300s and rents are about 2k for the area.