Campbell, CA · Member since 2015 · 14 posts · 9 votes
hi guys,
i have been investing for some time, purchasing a property every couple of years. But near where I live, the market is mostly cost prohibitive and deals do not pencil out. How have some of you guys chosen your areas to invest in? How do you find your team on the ground? Any shared experiences would be a great help...
I wanted to weigh in on this topic. Some markets that are really showing some growth are Charlotte, Orlando, Baltimore, Cincinnati, Jacksonville, Birmingham, Tampa, Indianapolis, Milwaukee, and Nashville. These markets have strong job growth, median prices of investment properties (because as you know California is ridiculously expensive to buy investment properties, especially LA, San Francisco, and Simi Valley), and high gross rental yield. My company actually identified these markets by looking at five economic factors in each localized market, which I encourage you to look at too when trying to identify a market - Construction, Job Growth, Interest Rates, Homeownership rates, and home prices.
Campbell, CA · Member since 2015 · 14 posts · 9 votes
10y
I've noticed that there are some good deals in the Midwest. I am not a Midwest resident, and finding the specific properties, fixing them, and renting them requires you to be there, or have a great team in the area. I wouldn't mind the Midwest, or any other area where I can get properties to pencil out. But it seems prohibitive to put all that together from my my location, as I run businesses here and have a family. Anyone been able to solve similar equation?
Investor · SSF, CA · Member since 2015 · 127 posts · 24 votes
10y
Shone Freeman , I'm in the same boat (by Levi Stadium). All the professional real estate investors I know are buying up stuff in Richmond and El Cerrito. Easier to get properties there that you can make money on with Section 8 .
Campbell, CA · Member since 2015 · 14 posts · 9 votes
10y
Roger, I have heard of people investing in areas like that, but I don't want to deal with section 8 tenants. And from my limited understanding of those areas, I wonder how they will hold up if the market softens.
That's why I consider going out of state. I am checking out turnkey deals. They have advantages, but I don't like that they are sold at close to retail prices and there is not much appreciation to be had from what I can tell so far.
Hanford, CA · Member since 2013 · 5k+ posts · 1k+ votes
10y
I just look at every area I go to and evaluate if it works in my model. IF it works than we look to invest. We bought 4 soon to be 5 houses in Central Valley California.
We have three properties and we have started investing in rental properties for passive income since 2013. The strategy we have used is to look at properties close to "anchors". The first one we bought was a condo near old town orange which is a very trendy spot with tons of restaurants, bars etc. It is also close to Chapman University. The other two properties we bought are close to UC Riverside. Having an anchor assures a good supply of potential tenants as well as a slight premium on rent. Of course getting the property at the right price is also key. But in general this works well.
The other factor we consider is the size. We usually focus on 1 BR condos or 3-4 bedroom SFRs. We feel these give the best bang for your investment bucks.
i have been investing for some time, purchasing a property every couple of years. But near where I live, the market is mostly cost prohibitive and deals do not pencil out. How have some of you guys chosen your areas to invest in? How do you find your team on the ground? Any shared experiences would be a great help...
Shone
Hello Shone,
I am wondering if you have ever considered investing in turnkey properties? It sounds like with the way you travel you will not be able to manage the properties too much yourself. Also, flipping homes will be difficult while traveling so much.
One of the best options for someone like you is investing in turnkey properties. For example, our company rehabs homes and sells them to investors. We also manage them so you do not have to worry about it. It becomes just like any other investment for you. It is a better way of buying and holding.
In terms of markets, I can tell you right now the Midwest is booming. Many people moved out to the costs and Texas a few years ago and real estate took off. It really took off in prices. Homes are very expensive out there. The Midwest is now starting to see a similar boom, but the real estate is still very affordable!
We have been seeing a large influx of investors in Cleveland. Many people from out of state are buying and holding in the area.
We are in Cleveland and things are really booming!
Registered Nurse (ICU) · San Jose, CA · Member since 2014 · 496 posts · 332 votes
10y
Shone Freeman You can read stats online like job growth and all that stuff. You will find all the markets in the Midwest and South generally the same with slight differences here and there. More important is to find the right people to go with the right market. All markets are unique and all investors are unique. I talk to actual investors and not providers to find good markets and good people. This way I get an unbiased opinion. It's also important to find people who actually live and breath in the market. They have knowledge that you will not find online. I always manage to find at least one local investor to give me his take on it. With BP everyone is so easy to find and more than willing to help each other. Good luck
I wanted to weigh in on this topic. Some markets that are really showing some growth are Charlotte, Orlando, Baltimore, Cincinnati, Jacksonville, Birmingham, Tampa, Indianapolis, Milwaukee, and Nashville. These markets have strong job growth, median prices of investment properties (because as you know California is ridiculously expensive to buy investment properties, especially LA, San Francisco, and Simi Valley), and high gross rental yield. My company actually identified these markets by looking at five economic factors in each localized market, which I encourage you to look at too when trying to identify a market - Construction, Job Growth, Interest Rates, Homeownership rates, and home prices.
Residential Real Estate Broker · Indianapolis, IN · Member since 2010 · 1k+ posts · 557 votes
10y
@Shone Freeman - I always recommend looking within 2 hours of your current residence to invest. If you still can't find anything, then Indianapolis is the place for you [IMHO]!
We have great jobs, low unemployment, strong rents and [still] affordable price points to make your dollars produce great ROI.
Investor/RE Broker · Eugene, OR · Member since 2014 · 3k+ posts · 968 votes
10y
@Shone Freeman Many, many investors in expensive markets, including myself, invest in turnkey properties out of state - something where all the pieces are taken care of for you - from acquiring property to rehabbing it to placing a tenant and managing it. Indianapolis is a very good market for turnkey that cash flows nicely. There are also other good markets in Indiana, including the NW corner, which is in the Chicago MSA, but has the lower taxes and landlord friendly environment of Indiana. Overall better cash flow possible there as well.
Professional · Turnkey Rental property Los Angeles, CA · Member since 2016 · 54 posts · 5 votes
10y
Im a Turnkey Guy ;-) we mostly sale income producing rental properties SFH in Jacksonville FL for 60K investment with 12% cap rate , we evaluated a lot of areas and found costal cities with population growth and expected appreciation as the best place to invest . we own over 150 homes there and lately I see an increase in investors reaching out to us for them , its a great city to invest in (I will send reports and news items if needed) but take my word it will have a great up sale there once banks run out of Foreclosed homes to sell prices for real-estate is excepted to rise, not that it matters on a buy and hold properties while collecting rent and not dealing with the day to day , management company and tenant in place .
Im a Turnkey Guy ;-) we mostly sale income producing rental properties SFH in Jacksonville FL for 60K investment with 12% cap rate , we evaluated a lot of areas and found costal cities with population growth and expected appreciation as the best place to invest . we own over 150 homes there and lately I see an increase in investors reaching out to us for them , its a great city to invest in (I will send reports and news items if needed) but take my word it will have a great up sale there once banks run out of Foreclosed homes to sell prices for real-estate is excepted to rise, not that it matters on a buy and hold properties while collecting rent and not dealing with the day to day , management company and tenant in place .
hope it was helpful
Ari Knepel
Hi, wondering if your a real estate agent. I'm interested in Jacksonville area I already own some property in Florida and I'd like to meet someone with experience in turnkey to assist me with my next purchase.
Professional · Turnkey Rental property Los Angeles, CA · Member since 2016 · 54 posts · 5 votes
10y
Im an owner of real estate there and know a lot about the Jacksonville market , been doing turnkey there for 7 yars now and sold over 100 properties to investors.
I would love to assist you in your next project , is it ok to connect ?
As many of the members have already mentioned, the Midwest is a great place to invest in. Cost of the homes is reasonable and the rents are good.
It sounds like turnkey might be a good option for you since your local market is priced so high. There are great returns available from turnkey properties and the greatest benefit is that you get instant access to a local team that you can work with. The Cleveland, OH market where I personally have experience is really taking off and turnkey investments generally yield returns of 15% to 20% COC. Definitely do your research before moving forward with a turnkey provider though. Having a good team is essential to your success when investing out of state.
Feel free to contact me if I can be of any assistance. I would be happy to discuss some of the opportunities available in my market.