Orange, CA · Member since 2013 · 10 posts · 2 votes
Hello BP!
I am currently looking for for buy-and-hold investment property somewhere in the Phoenix area. I have already found several deals where the cash flow is great, and I plan to make a trip out there (coming from So Cal) before the end of the month.
I am just curious what the community thinks about the Phoenix market having seen a dramatic increase in property value in the last year. I'm mainly concerned about buying at peak prices, leaving no room for appreciation. However I have also read that the influx in property purchases by investors were made mainly on SFR's. I know that their strategy is to rent the properties out, is that bad news for me and my potential multi-family unit in terms of increased vacancy?
My main goal for these properties is mainly cash flow and not so much appreciation, but I definitely do not want to see any depreciation either.
Any thoughts from those in the Phoenix market would be greatly appreciated!
I have done extensive research and have made several offers in the last few months on multi family homes in Phoenix. I haven't found any good deals and all my offers have been rejected. I am sticking with SFR's which still cash flow pretty well despite the run up in prices. Full disclosure, I only looked at B properties. I have mo desire to be slumlord.
I am flying out to Phoenix in a couple of weeks and feel the Multi Family market has room to appreciate. I am concerned however about what single family rentals do to the Multi Family rents. Currently rents are quite low even with healthy growth in the job market and relatively low delivery of new projects. Additionally, vacancy rates are quite high...
We own 10 MF buildings in Metro PHX area and my advice would be to BEWARE. There has been a run up in MF about as much as SF. There is very little distressed inventory and anything at even reasonable prices has many offers. I see junk that couldn't sell for under $50k 2 years ago getting 20+ offers and selling in cash deals for $175k+. I'm talking about property that had no chance to cash flow at $50k - 1950s built gang infested, falling apart where owner pays all utilities. I monitor all multifamily that goes to the MLS and I don't remember the last time I spotted a deal that made sense. Management of multifamily in PHX is quite intense due to the class of tenant and low rents for SFR, you end up with low income, no credit train wreck people. There are always off market deals to be had but good luck finding those from out of state.