Indianapolis....what's going on?

[Todd Mims]

Can anyone expound on what's going on in Indianapolis and if this is a good place to look at buying property. There seems to be a little buzz around this place as there are a lot of postings on here touting the place as having many "cash cows". The prices are probably in line with many large midwest cities, which are very reasonable compared to my Washington St. What are the taxes like? So what's the economic/business situation, new development, education looking like? Anyone familiar with Indy want to share info on if this could be a place to seek investment?

[Christie Snapp]

Hi Todd,

My company specializes in helping out-of- state investors invest here in Indianapolis. It is a great rental market (renters make up 37.33% of the Indy pop.), and you can find highly discounted prices on homes. Taxes are within the bottom 5 lowest in the nation. Because of positive signs in the market (like the slowing of foreclosures), the metro area was chosen one of the top 10 investment markets in 2010...according to the Metropolitan Indianapolis Board of Realtors. So there are lots of good reasons to invest here! Get a hold of me if you'd like more info on Indy.

Christie

[Todd Mims]

Christie,
thanks for the info, low taxes are a good thing...and as long as you can pull in pretty good rents sounds good. I will try to get a hold of you soon. Also, like I was saying how is employment out there, jobs...coming or going are they?.. Anyone else with info is welcome to comment further, also.

[Marc Freislinger]

We also provide cash-flow rentals in Indianapolis that meet 2% and 50% rules.

Indianapolis is booming with out-of-state investment right now because of the reasons Christie mentioned.

A lot of investors are paying way too much for their properties, so watch out for other investors trying to make a too much profit. We do management for a few people who purchased homes for twice what they should have. I'd rather sell someone property over and over again then rip them off once and never see them again.

[Josh Keys]

I was interested in Indy when I started my search but got frightened away by what appeared to be high vacancy rates for rentals. Interested to hear from current indy investors/agents though.

[Marc Freislinger]

We don't have any problem renting rent-ready apartments. The problems we run into are owners that won't let us make-ready units until they are rented.

It's imperative that you buy right, so you can make money without over-pricing your apartments.

[Marc Freislinger]

I wish it were so easy! Take 46236 for example, my old zip code. A quick realtor.com search turns up 280 homes from $2.3 million to $44,000. This city has great and terrible streets just blocks apart.

46201 is mostly high crime, so is 46218 and 46205. But these areas are all rentals, and cash flow is king right?

We are getting more gang activity, but it's still mostly "wannabes," who only kill each other. There are no places in Indianapolis that I'm afraid to go to during the day, and only a handful that I won't go to at night. We already manage properties in some of the worst neighborhood and keep them occupied well.

Send me a PM if you'd like to know how we can help you invest in this area.

[Rich Weese]

Marc- you're too honest! I expected all chamber of commerce vanilla covered crap in replies. You were very upfront. That is very refreshing from Indy area! Rich

[Marc Freislinger]

I agree that converted duplexes often have weird set ups. All of the properties that we currently deal with were built to be duplexes. They are older properties though. We look for nice streets in bad neighborhoods.

The reason I look for multi's is because of the vacancy rates. If half a duplex is vacant, I'm still making money. If a house is vacant, your losing money until it rents. I see that stress cause people to make bad decisions.

We do our own property management, and manage for out-of-town investors. So far we've never had a problem, but unlike some PMs, we don't carry cash. If my partner or I are ever robbed, they're more likely to get lead than paper.

I missed a call from an 808 number a little bit ago, if that was you Tom, feel free to try again. :)

[Steve Smithy]

I invest in Terre Haute, right near the university. My vacancy rate has been higher than expected, but overall I've got a good deal. I have 2 properties that I bought from a local flipper of multi-units, he has many other deals that I think for an out-of-state investor are good, he rents them and everything before he sells them to you so you don't have to do anything.

[Marc Freislinger]

Steve, what is meant by "he has many other deals that I think for an out-of-state investor are good?"

I don't know the Terre Haute area well, other than driving through it to my rentals in Vincennes, but I'd be interested if they are profitable.

[Steve Smithy]

I mean that they are completely renovated buildings with tenants and property management setup already. Yes they are profitable, they easily meet my 2% rule (my first building is 3% with a new roof and everything. Some areas of Terre Haute are run down, but my strategy is student rentals so they rent again easily.

[Todd Mims]

Yes, cash flow is king until your PM get's jumped.

Really, does this really happen?...I grew up in Detroit (need I say more) and I didn't really know of this happening. I haven't lived there in a while or maybe I'm even out of touch, but is this something you guys really think keeps people or you guys from making money being worried about someone being jumped in a bad neighborhood? I learned from travelling the world, which applies in neighborhoods around the world, no matter where you go, don't look like you have too much money, blend in and don't be flashy and flamboyant in those areas. Pulling up in your new shiny S600 benz does not help your situation, don't want to get to far off track, but thats my opinion.

[Rich Weese]

I have around 40 sfrs in rio grande valley, tx. 100% full. The manager tells me he has zero vacancies in ALL the properties he currently manages. Any other area match that %?? Rich

[Marc Freislinger]

I'm at 90%.. and my only vacancies are units that owners won't pay to make-ready until they're leased.

[Todd Mims]

Rich, I know most of Texas is good for investing, but why do you think you are maintaining 100% occupancy? What are some contributing factors to that area

[Rich Weese]

Todd- There are quite a few reasons that The Mcallen area is at the top of list. For 3 straight years, Money mag had selected Mcallen as # 1 in nation for future appreciation. Median price of homes is low compared to rental rates. There were 2 companies that built HUNDREDS of low priced all brick homes in the last 7 years. Many of these are now resales, reos or short sales.
The area has just been selected # 2 for job growth for the next 12 months. There are approximately 1 million residents in the Rio Grande Valley. The Wild Card is there is a city just across the border(Reynosa) of an additional million people. This is also the city where many of U.S. plants have moved. A lot of the Reynosa Many execs and high up Plant workers live on the U.S. side.
The weather has also been discovered by winter texans. 700,000 strong. Mcallen is actually further south and sunnier than Miami, FL. Most people don't realize that. Lots of positive factors in that area, imo.
However, Most areas of TX are strong. I own a 40 year old 154 unit in Dallas area. It is currently 97% occupied. Texas is still very good. Rich