Charlotte and surrounding area questions from a new investor.

[Ryan McGlasson]

Hello everyone, I have a few questions about the Charlotte area I really would love input on because I do not live in Charlotte currently it is just the market I will be moving to invest in. With me not being in Charlotte currently, only having family friends live there, some questions may seem silly so I apologize for that.  

I have been researching Charlotte the last few months for single family homes and I have not really been able to determine myself these few things for single family home investments, If you are looking to purchase a house as an owner occupant and rent out rooms in the house to start out, is it a wiser choice to have this house be closer to downtown charlotte? As opposed to the suburbs surrounding charlotte? (mint hill, concord, harrisburg). 

Are separate rooms much harder to rent out the further away from downtown you are?  The reason I ask this is when I have looked into the Charlotte area many of the homes that are in the price range for me in a nice area, are much farther from downtown charlotte, or generally outside of the 485 highway ring around the city. They are usually right near harrisburg or outside of it by concord. Is it even wise to invest in these suburbs? Are they too far away from charlotte to be a hot rental? The cashflow on them seems exactly where I would need it to be , but am i ignoring the fact its quite a distance from a largely populated area? Or is that not what I should ALWAYS be focused on? Or am I not thinking about this correctly? 

Tons of questions sorry I am quite new and always wanting to learn more.

Any advice or help is really appreciated, thanks in advance!

[Harry Marsh]

Like anything, you need to know your market.  I live just south of Harrisburg near Mint Hill (fair to good investment area).  One exit North on 485 is often a very poor investment (huge foreclosure rates) because they were lower middle class homes built 2 feet from each other's door.  They're poorly constructed vinyl homes that aren't aging well, and the buyers were tenuously qualified to buy them.  Rough developments.  But you'll think they're priced amazing well compared to stuff just a few miles away (there is a reason)

2-3 exits North are older communities.  Larger lots and far more likely to stand the test of time.   But it's far better east of the highway than west (toward Concord, as you suggested)

3 -5 exits North are the 28269 areas that suffer from the problems in paragraph 1.   If you get past I-77 (roughly 10 -12 minutes north), you get back into some nice areas again (highland creek, mountain island area).

The exits 3-4 south of me are doing wonderful (south Mint Hill, Matthews, Indian Trail)

I think it would be very hard to invest without being here and seeing the areas for yourself.   More important than any particular area may be the particular deal.  For the right price, any house might be your best investment.   But the neighborhood and details can matter, a lot

Daily rentals:  I see a lot of these.  A few years ago, AirBnB was the 'thing' and people were doing wonderful.  Supply and capitalism has caught up to those.  A quick search shows a 6-bedroom brick house renting for 64/night.  One night minimum stay.  I don't know how he's making $ after providing utilities....(i would guess he's trying to break even)

Which leads us to daily room rentals.  I think the AirBnBs are making less money, so people switched those to daily room rentals, to try to get the same return that they once had.


I think we could all agree that the further you get from downtown, the more difficulty you'll have with daily room rentals.  Charlotte has a large supply of temporary work-staff.  IT Professionals and other semi-professional jobs on temporary contracts.   The further from town you get, the less likely they'll be, to be looking for your place.   Your niche would be a different sort of folks in those areas.
So, I think you're thinking about the right things.