Choosing between two different markets?

Question

I'm a college student and I spend about half the year with my parents (summer, winter break) and half the year in Columbia, SC, where I go to college. My parents live about 3 hours away. I'm a newbie and do not own any property yet, but I have done a ton of research and am ready to take the plunge when I find a good deal. I'm looking for small multifamily rentals, and I see the obvious benefit of living in the market you invest in. However, will being a few hours away for part of the year pose a significant issue? Would it be better to house-hack a property and stay there year round? Any input is appreciated.

Jay Berube · Answer

Hi, Winston! When I have to decide in which market to invest, I usually base my decision on the following criteria: jobs that are being created and have been created for the past 5 years; the building permits that have been pulled; the transportation in place; the unemployment rate; the overall infrastructure;  access to affordable housing; the housing market, specifically days on market, and contractor prices. Based on this data, I try to project what's going to happen in the next 5 years. Based on that, I decide whether to invest in that market or not. This is just what I do. Perhaps you'll find this pattern useful.

David Kiszka · Answer

Account Closed If you are deciding to invest close to home or a few hours away you will still need a great team in either place. Using a buyers agent will not cost you anything to find the property. After you find a property that works for your numbers, make sure you find a good property manager who has either a list of contractors they use for repairs or might even have some on payroll. This will cost you a little more but if you are trying to do this passively, you do not want to spend a day trying to track down a plumber to snake a toilet on short notice. Work property management fees into your budget and you will not be disappointed when you find the right one. Best of luck.

Jay Berube · Answer

@Brian Thomason the building permits that have been requested in that area.

Brian Thomason · Answer

@Jay Berube that's a great checklist! When you say "The building permits that have been pulled" can you please elaborate a little bit on that? I am new to the RE industry and still learning. Do you mean permits that are required for that area or on a specific home that you are interested in?

Christopher Bunge · Answer

There is no reason you'd have to be on 24-hour standby.  You'll do great and spend less on a duplex mortgage than you will on rents in most student housing.  The biggest challenge will be finding someplace here that doesn't need significant work.  Your cash availability will have a bearing on what and how you spend, of course, but even a small house with a roommate or two is a win in Columbia.

Choosing between two different markets?

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