Available in Arizona

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Hey there, I'm an investor minded Realtor in the Phoenix, AZ metro area that is ready to team up to find you a property that meets your criteria.
Let's break through the 09 doom and gloom once and for all!

[Amber H.]

Matty & Jon,

I have a knack for finding great deals in the Phoenix area. I have a RE license, but am not finding the deals on MLS. I'm only looking at deals that produce $150-$1,000 mo. positive cash flow. $150 per month in this market is actually on the lowest end.

I looked at that deal Jon worked up, and in that popular drive by shooting area, I don't think you would get a quality tenant, and rent is more in line with $700 per month. It doesn't matter how many bedrooms a home has here, nor size. It has more to do with the crime rate, school district, proximity to major highways, ethnic area, etc. This same exact home in Mesa would get $800-900 per month, while in Scottsdale, it might command $1,100+.
Personally, I don't like dealing with homes in bad neighborhoods, nor old homes unless they've been or you are going to rehab them. Any home here over 10 years old is at great risk of the AC system going out. A $2,500+ repair. People do not change the air filters every 30 days, which is necessary. Many homes I've been in have the filter clogged, a sure sign you're going to spend $ right off the bat. With indoor temperatures here 110 degrees in the summer, if a tenant's A/C unit go's out, you are going to pay for them to stay in a hotel until the repair company with a 3 week wait period can get out to your home, and hopefully, they have the parts in stock.

Oh! Now let's mention code violations. I have not seen a home in AZ built in the 50's or 60's that has not had serious code violations. Some are scary. Some have mold. Even homes built in the 80's have had violations. Electrical and plumbing done incorrectly, buildings attached to the neighbors building must be torn down, etc. You can buy old homes for $50,000 all day long here, spend 2-3 months and 20-30k to fix it and it will still be in a bad neighborhood.
My idea is to deal with newer homes or rehab in good areas only. I come across newer deals in the Queen Creek and Apache Junction areas all the time. I also come across nice homes with acreage or luxury homes that did not quite get finished by the developer (no driveway, walkway nor outside lights).
Example #1 in Queen Creek, I found a home built in 2005, 1,900 sq ft for $65,000. It is further out from Phoenix, but since most homes in QC rent for $800-$900 per month, you could easily rent it for $800-$850 per month, have $150 positive cash flow, and not waste your time nor spend extra money to repair it. (Some homes do need new paint or new carpet.)

Here is what's happening in Queen Creek: many people are in mortgages of over $2,000 per month. They let their home get foreclosed upon, and move down the street, renting for $800-$900 per month. I know 3 people that have done this so far. They did not want to pull their child out of school, or they had joint custody and did not want to move too far from ex-spouse for their exchanges.

Example #2: I think multi-families are also the way to go. These need repairs usually. I found 3 units with 2 bds each on 1/3 acre, great location near Scottsdale for $75,000. Rehab work with new A/C's, etc. and pre plumbing/electrical done to add 4 more units was $30,000.
Expenses:
$630 for a $105,000 loan at 6%, plus some closing costs
$120 year actual taxes
$80 mortgage ins.
$100 year property ins.
$180 mo. water/trash
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$1,110 total
Rent collected: $575 x 3 = $1,725
+ cash flow of $615 per month (vacancies and management fees were not calculated in, as this property previously had no vacancies and since empty, you'd be getting all new 1 year leases). Management fees here are 5-7% per month if you so choose.
After repair value of $175,000, so you now have equity and it's already set up to build 4 more units!

I'm not seeing this as a flipping market unless you have something unique or get it very, very cheap, as there are many good deals here, but the banks are not giving people loans to buy anything.

Let me know what you're looking for. If you have a lot to invest, there are also numerous home builders that were foreclosed on, or close to it. They have land, spec. homes and some unfinished homes. I worked for some of these builders and have a good granite counter top installer, and a couple of contractors that can do repairs, I'm also very hands-on.
Amber