Looking for cash flowing remote market recommendations to start researching

[Adam Gusky]

Hello, 

I am looking to purchase my first property between $100-$300k that I can manage remotely. I care more about cash flow than appreciation, but obviously don't want to be in an area that is depreciating at the same time. Open to hearing about Airbnb/vrbo but had 12/yr lease in mind.

Appreciate any advice and tips!

[Dan Guenther]

Hey @Adam Gusky - welcome to the community ! 

My first question is will you be renting while investing in an out-of-state market? 

If you were to stay in Denver paying rent of $1200+/month (likely much higher) while cash flowing around $100/month on a $100K property would that make for a good investment? 

There pros and cons with both options. Investing here in CO might have a higher point of entry but you would also be able to learn hands-on how to manage a property. If you could get into a house hack and cut out or eliminate your living expense, you would be able to scale much quicker. Larger metros also typically appreciate at higher rates which is a bonus. 

Another point to consider is the downpayment options for owner-occupied (you must live in the property for at least 12 months) vs non-owner-occupied financing. 

With owner-occupied loans, you can go as low as 3% down compared to non-owner-occupied loans which range from 10%-25% with the average lender requiring 15%-20% down. Also, as a first-time homebuyer, you could qualify for grants and down payment assistance. 

Owner Occupied - $300,000 purchase price with 3% downpayment = $9,000

Non-Owner Occupied Investment loan - $300,000 PP with 20% down = $60,000 

Denver is definitely an expensive market but if you are willing to get creative there are still deals to be had. You might want to consider smaller markets like Greeley where you can still find cash-flowing deals under $400K. 

It's great that you have options though and one strategy does not fit all in the real estate game. Take some time to thoroughly research different strategies before making any decisions.