Alabama Pros vs Cons

[Paul Evans]

So, was looking into investing in the state of Al.  If anyone would like to chime in with a personal experience on what it means to be an investor in Al.  Examples like tax rates, renter problems (renter friendly vs landlord friendly), closing problems, tax implications etc...  Any and all input is appreciated.  

Also, if anyone has any ideas of areas to avoid please let me know as well, thanks.

[Melissa Nash]

 I currently buy my own properties in both Birmingham and Montgomery. Alabama has the second lowest property taxes in the country —you go to Alabama for cash flow you don’t go to Alabama for growth and appreciation. Alabama is a landlord friendly state and you can move a tenant out very quickly, in fact usually you don’t have to go through courts because the tenants know that they don’t stand a chance and they don’t want to risk getting that eviction stamped on their credit so you can usually kick them out on your own very quickly. 

Depends on the level of risk that you want to take for the type of neighborhood you’re going to be in. You can’t go  ZIP Code in Alabama it is really street by street neighborhood by neighborhood. You can have an A class neighborhood and two blocks away is a C class neighborhood so you definitely need to be working with somebody who knows the area and also someone who knows the up-and-coming areas. And then once you find a good property and the property is now rent ready you need to make sure you’re working with a good property manager. Property managers are probably the silent killer here. I have worked with several terrible property managers In Alabama and I have also worked with a couple of awesome property managers. 

As long as your expectations going to Alabama are for cash flow and you’re clear on your strategy and the type of area on the type of tenants you want it is a win-win situation. I do both turn key and I work with a local group that helps me renovate a couple properties with the brrrr type program. 

 I think turnkey is generally the easiest way to get started and get into a market as long as you’re working with a vetted turnkey company and they Have a proven track record and they are not trying to get you into bad areas or tell you that you have to pay cash-  if you work with the turkey company and they have to tell you that they only except cash or you should use cash only, then you need to run from them as far away as you can get—- the only reason why they would be telling you to pay cash is because they know the property is not going to appraise. 

Message me if you want to discuss this market further-  or talk deeper about property managers in this area.