St. Louis Missouri and long-term buy & hold investing?

Question

What can you tell me about the market?  We are looking for feedback and info on best locations, high-quality vendors, market trends.

We have been researching the market and visited several times with local investors.  Now we are looking to verify and learn a little more from other investors who have been buying, holding, selling, renovating, renting, etc...

Has anyone purchased Turnkey properties there?  Has anyone built a team for passive, long-distance investing?  Has anyone dealt with a property management company in St. Louis?  Is there opportunity on the Illinois side of the river as well as the Missouri side?

Good or bad, we'd love to hear what is happening with real investors in the market.

Megan Greathouse · Answer

Hi, @Chris Clothier. I live and invest in St. Louis. I just started my journey last year, and haven't purchased turnkey properties here, but I've purchased property both from the MLS and one through networking here on BP. Are you primarily interested in single family, or are you open to small multi-family?

The city offers some good multi-family options, though there's lots of interest and competition there now, from both local and out-of-state investors. West County and Mid-County are probably the most desirable areas, but are generally too expensive to cash flow on a single family house. South County and North County probably offer better opportunities for cash flow, but you need to find the right areas and school districts. North County definitely has some challenges, and you need to know where to invest up there... but with the airport and Boeing in North County, some areas would be solid blue collar neighborhoods for rentals.

Overall, St. Louis is a solid little city. It's not showing much population growth, and we've lost some HQs recently, but the jobs haven't necessarily left with those buyouts. We do have strength in a couple of industries, including aviation, agriculture/bioscience, and finance/fin tech. If you haven't already, look into the Cortex Innovation Center, 39 North, and the St. Louis Promise Zone to understand some of the large development initiatives happening throughout the region. Finally, we have a couple really solid universities in the city as well (Saint Louis University and Washington University in St. Louis) that are helping to build up certain areas and support initiatives like Cortex... I attended both of them, if you want a student perspective. :)

I personally focus more on multi-family in South St. Louis City and Mid-County. But if I can help answer any other questions, I'm happy to help!

Nicholas Richard Ray · Answer

I'm very new to investing in general and in the city. Just moved to South City in Dutchtown at the end of last year. It's definitely a C area as a lot of the surroundings to me are. @Megan Greathouse explained the landscape much better than I could have for the city in general.

One thing I would point out is the possibility of moving further westward - St. Charles County, where I lived for 24 years, hasn't stopped growing with O'Fallon growing to one the largest populations around and Wentzville well on it's way. Megan shared a great article I believe recently highlighting population movement and St. Louis city fell slightly in population but the Metropolitan area actually gained slightly. The prices are getting higher out there as well but a great market with little to no crime really with a few areas that are a little older and more affordable.

There's plenty of others here that can give you much better insight on both markets I'm sure but felt it should at least be something on your radar especially if you're focused more on SFRs.

Megan Greathouse · Answer

http://www.stltoday.com/news/local/govt-and-politi...

James Fowler · Answer

@Chris Clothier the metro east side of the river has pockets which have good returns, high renter demand, and relatively low purchase prices. Taxes are higher, but prices accommodate the difference. I'm starting to be of the opinion there's less attention there making it easier to spot deals; using neighborhoods I've targeted in STL as a comparison. I've been focused on mid-class C+, B- neighborhoods with great schooling for family rentals, or working professional rentals; targeting 900-1200 a month for rent. I work in STL, and live on the east side; and it's interesting the difference to me. What people say about STL is very true, it's segmented block by block. You could have a highly desirable area, just a couple blocks away from areas which you don't feel comfortable walking in. I think much of mid-class renter base expects to drive to anything it desires, or pay a premium to be in the certain block with it's desired amenities with walk-ability. Public transportation for mid-class working people seems to be mostly undesired, making the last point not as important IMO. A lot of families who work downtown, don't live downtown; 1/2 - 1 hour commutes is not uncommon. I think the two biggest factors for families for this regarding STL is perceived safety and school ratings. I see more working professionals being this mid-level market tenant base for downtown rentals. Because of the family related concerns mentioned earlier, metro-east is a quality option for this base. It is segmented by not so hard to understand like STL can be with it's pockets. Living all over the metro east during most my life may be why I think that way though! There are decent working class communities and schools, with a lot of manufacturing around Granite City, Belleville, and Wood River. There is also stable old small city towns like Collinsville, Bethalto, and Troy; both has decent schooling, with larger yards room to breath for families. Then there are other small towns which accommodate housing needs for a lot of jobs related to the Scott Air Force base: Mascutah, New Baden, O'Fallon, and even Trenton. The towns mentioned are more sought after for different reasons, but they are on the outer fringe, we're it appears to be growing outward. O'Fallon specifically is expected to grow steadily over the next few years, and has a lot of development when comparing to the rest of the metro-east. The are relative experiences on the west county outer edges of STL, but the buy-in price is much steeper per unit without the rent relatively matching that difference. Travel to jobs downtown is more inconvenient from west county, when compared to some metro-east communities. Hope that helps.

Account Closed · Answer

Hey @Chris Clothier, it's John Skaggs.  You should remember me from JDS Properties in Memphis.  I moved up to STL in 09 and have been doing real estate up here ever since.  I'm also licensed up here too.  Give me a call if you want to catch up and talk about STL.

St. Louis Missouri and long-term buy & hold investing?

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