Buy and Hold Out-of-State: Market Analysis from a Newbie

[Mason Fiascone]

Hey everyone! This is my first post on BP so please go easy on me!

I am new to real estate investing, but have been digesting info for the past 3 years from places like Cash Flow Ninja Podcast, BP Podcast, and BP.com. I've been stagnant in simply learning, not taking action, and that stops now! I'm committed to taking action. At the same time, I'm aware that this is a tough time to get started in the real estate market cycle, so I'm also committed to finding an amazing deal even if it requires a lot of upfront work.

I've targeted buy and hold rental as my #1 strategy and the next step for me is choosing a market.

For more background on myself, I grew up in Seattle, WA and since then have lived in Phoenix AZ, Chicago IL, Steubenville OH, Charlotte NC, and am currently in Montclair NJ (and I'm only 24!). Because I've lived all over, will likely move within the next year, and now live in a high-priced market - NJ / NYC, I am looking to invest out of state for my first investment.

Through research and learning, I compiled a list of criteria for selecting a market, as well as a list of markets, largely based on this article.

Hopefully obvious, all of this data is directional, but I needed criteria to begin, since I can't evaluate every single market out there!

Here were my selection criteria, in rank of importance:

1. Personal Network - do I have any connections already present?
2. Price / Rent Ratio - lower the better
3. Avg Median Income - feeds into #2, not as important on its own
4. Avg Median Price - feeds into #2, not as important on its own
5. Avg Median Rent - feeds into #2, not as important on its own
6. Rent % of Income - rent should be >1/3 of income
7. Sociodemographic Rank - should be high (used this article)
8. Population Growth - should outpace US average (used this site)
9. Jobs Growth - highger the better (used Forbes data: example)
10. Law Favorability - should be landlord-friendly (used Avail: example)
11. State Tax Favorability - should be favorable (used this article)
12. Poverty Level - should be low (used city-data.com)
13. Crime - should be below US average of 290 (used city-data.com)
14. Industries Present - should be diverse (used city-data.com)

Here are the markets I evaluated:

1. Bend, OR
2. Greenville, SC
3. Charlotte, NC
4. Meridian, ID
5. Midland, TX
6. Spartanburg, SC
7. Huntsville, AL
8. Kent, WA

Without any further delay, here is my market analysis laid out with selection criteria and markets:

As you can see, the Top 2 Markets are:

• Meridian, ID
• Charlotte, NC

and they are mostly green across the board, hitting all selection criteria, at a reasonable purchase price for my first investment at a young age.

Now that I've completed a brief analysis, I'm looking to dive into deal finding and developing my Core 4.

What are your thoughts on my preliminary market analysis?

Are there things I may have missed?

Was this helpful for you to see as a newbie or even as an experienced investor?

-Mason Fiascone