Determining Market Performance

[Matthew Olmos]

I am looking to begin my real estate investing career by investing out of state. I am currently in California. I have looked through dozens of marketplace deals on BP plus countless on Loopnet. My question is, how do you gauge an emerging market? I frequently hear Denver is a hot market for instance. OOS investors, what do/ did you look for in out of state markets? Thanks in advance for any insights!!

[Ali Boone]

Well, you need to be able to distinguish between hot markets, and hot markets where the numbers shake out. Denver, LA, San Fran, Phoenix, etc. are all "hot" markets and with great market fundamentals. But you aren't going to find cash flow there. So you need a happy middle of a market that is a) solid and with good market fundamentals and b) with investor-friendly numbers. 

This may help some-

https://www.biggerpockets.com/renewsblog/2014/02/2...

That helps break down various factors to look at. Once you understand those, you can start asking people what markets they are investing in and weigh those against those factors and see how you personally feel about the market.