New member from California--Want to Invest in St. Louis, Missouri

[Michelle Eisenberg]

My name is Michelle. I'm new on Bigger Pockets and to the world of real estate investing, but I am eager to learn and get started. I have been reading as many books on real estate investing as I can find in the library, and I've been listening to the Bigger Pockets podcasts on all of my commutes.

Investment Goals:

I live in the California Bay Area, but I'm looking to invest in St. Louis, MO due to the generally lower prices. I lived in St. Louis for 10 years, so I know many of the neighborhoods. I'm primarily interested in small multifamily properties, but if I found a single family home with a decent ROI I'd be interested.

Specific Goal: I'd like to buy my first small multifamily or single family property within the next year that nets at least $2000 a year after expenses and mortgage payments.

Currently Working On:

Step 1: Finding a real estate realtor/broker with experience working with investors in the St. Louis area

Step 2: Finding a property manager that I can trust to take care of my property while I'm in California

Step 3: Buying a small multifamily or single family property at or under $100,000 (with 25% percent or less downpayment) in the St. Louis, MO area. 

[Edward Burke]

@Michelle Eisenberg - Congrats on your decision to invest in real estate!  I live in California as well (San Diego), and I invest in St Louis.  You have the wonderful benefit of having lived there, so that is huge.  I decided on the city for a number of reasons, but spent about 5 months just trying to learn the neighborhoods and areas prior to pulling the trigger.  Having said that, I will close on my 5th 4-family property in the area this month.  Selfishly, I don't want to help with # 1 as I don't need more competition, but my agent is too nice of a guy not to help him get more business.  I consider him a personal friend, and look forward to my St. Louis visits as we get to hang out as well.  If you are serious, I will PM you his info.  He's super busy, so I wouldn't want to waste his time at all.

However, I see number 3 as a huge hurdle for multifamily. You can definitely find a nice SFR (Single Family Residence). I haven't run the numbers on a SFR, but that may be your best bet with the budget.

For multi family, you would have to invest in rough areas to get something below $100K, or be prepared to put another $50-$100K into the property if it is in a good area. Most property managers won't manage properties in the rough areas. Having said that, you can find nice properties at $180-$220K (my last 3 deals were in this range). You will need 25% for multifamily, and you have to be prepared to submit an offer within a couple of hours of hitting the MLS for the good ones. I usually write an offer within 2 hours of hitting the MLS if I know it is good. My offers are typically AS-IS, not contingent on financing, and the inspection is purely for information purposes. I still have competition on every one!

My point is pick the right property class for your budget (probably SFR), invest in the right neighborhoods if you want a good PM, and be prepared to move super fast (no analysis paralysis). Good luck, and happy investing!!