New Member Introductions
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated over 1 year ago on . Most recent reply
Dipping my toe in the waters of rental properties
I'm new to real estate investing but want to grow my investments beyond the paper assets we have. I live in Southern California but don't believe that investing here is in my best interests given the high cost of living. As such, I'm looking for cheaper places to acquire rentals with minimal down payments. I've been reading the books but need to put it into practice.
I'm a software engineer by trade and have worked with mortgage companies before so I'm pretty versed in how the loan process works.
Most Popular Reply
James,
It's very common for investors in California to seek "out of state" REI properties due to the price range, taxes and lack of ROI. You would be surprised to see states like Indiana, Ohio, Tennessee, Alabama, Florida still have some great deals. A few of these states offer some realistic price ranges for even multifamily 2-4 unit homes under $200K.
You do not need a lot of skin in the game just 15% down will get you into any 2-4 unit. Spread your cash over a 3-4 properties instead of just "one" rental in California. Now is a great time to buy because you have a few things playing into your favor. Sellers with inventory do not want that MLS to roll over into the next year. Having to cover another year's worth of taxes, insurances and DOM days on the market.
Rates are higher so a lot of buyers are afraid to make the move which is a bad idea because you can always refinance for a lower rate in 12-24 months. That is causing a lot more inventory to sit longer and prices are dropping as we get closer to Dec. 31st. There are also a lot of home owners that want to cash out in this high equity market before anything changes so they have more room to negotiate.
Most owners who purchased these homes got a great deal 3-5 years ago and now are sitting on equity that has multiplied by 100. I would look into Dayton, Ohio, Carmel, Indiana, Citrus County, FL, Knoxville, TN. I have worked with a lot of great agents in all of these states and they are all on her on Bigger Pockets.