Midwest Investing Is a Gold Mine?

Question

Hello all,

I'm a new agent but have been investing for 3 years now with my wife. I've been in the Kansas City area for 5 years now but I grew up in Oregon. That being said, investing became a reality more or dream, once I moved to the the Kansas City metro.

In my personal opinion, I've found that rents aren't the highest nor the lowest. Giving myself great cashflow and affordability. BUT the big downside I hear from investors is; "it's the midwest" which is enough reason for some people not to take on any sort of investments over here.

What are your guys' thoughts? My wife and I have had extremely good results with our rentals out here in KC and it seems as if this may be one of of the last regions where the 1% rule applies when analyzing a property.

Steven Foster Wilson · Answer

The Midwest is really starting to get some attention for quite some time now. Just take the Columbus for example. We are starting to see this area boom due to huge investors and corporations like Intel choosing to set up shop. There are still 1% deals, but the more attractive part is the population growth and other economic drivers!

Blake Park · Answer

It seems that there may be some confusion among investors, as I have heard differing opinions on this matter; however, in my experience, many investors are drawn to the Midwest region due to the promising potential for high cash flow and appreciation in the real estate market. This trend is exemplified by the recent expansions of major companies such as Intel and Honda to Columbus, Ohio, which is further evidence that the Midwest is becoming an increasingly attractive target for investment.

Brandon Goldsmith · Answer

There is a ton of opportunity in the Midwest. There are multiple markets here in Ohio where those metrics can still be achieved. @Wyatt Seidel

Harrison Chow · Answer

Hi Wyatt! There are several reasons why investing in real estate in the Midwest can be a smart choice. Here are some of them: Affordability: Compared to many other regions in the country, the Midwest is known for its relatively low cost of living and affordable real estate prices. This means that investors can often find good deals on properties and get a higher return on investment compared to other areas.Stability: The Midwest is known for its stable and predictable real estate market. While other regions may experience booms and busts, the Midwest tends to see more modest but consistent growth over time. This can be attractive to investors who value reliability and consistency.Diversification: Investing in real estate in the Midwest can be a good way to diversify your investment portfolio. By spreading your investments across different regions and types of properties, you can reduce your risk and potentially increase your returns.Strong rental market: Many parts of the Midwest have strong rental markets, with high demand for both residential and commercial properties. This can provide a reliable source of passive income for investors who are interested in owning rental properties.Growing economy: Many parts of the region are seeing steady and sustained growth in industries like healthcare, technology, and advanced manufacturing. This can create new opportunities for real estate investors, especially in areas with a growing population and job market.Hope this helps!

Myres McDougal · Answer

Just finished a flip in Overland Park, KC! Done and it was a great area to work...even though I am based in Denver. It was easier to get into that market- 287k for 4/2.5. Connect if you want to chat.

Dustin Street · Answer

@Wyatt Seidel the midwest is definitely where its at. Affordable markets, nicer neighborhoods where families want to rent, nice appreciation, and generally amazing atmosphere! KC is actually in a spot to grow EXPONENTIALLY over the next 3-5 years. We are about to be a brand new city with much higher prices. Now is the BEST time to pick up more deals. I actually have 2 currently that you can be all in at about 100k each (;

Tim Debronsky · Answer

@Wyatt Seidel I feel like many of the Midwest markets are similar. Yes, you can still achieve good cashflow and meet or exceed the 1% rule here in Cleveland too. Continue investing and growing.

John Ringgold · Answer

I agree completely! I am also in the Topeka market and an an agent and an investor we can actually measure investment opportunities by the 1% rule. We currently have a few multi-family opportunities on the market here that beat the rule!We recently bought a full duplex that is going to cashflow over $500/month! We did replace flooring, light fixtures, updated the bathroom and painted the interior, but overall, it was a light remodel.Here are some of the best opportunities in the area if you'd like to check them out for yourselves! https://searchtopekahomes.com/...

Malcomb Stapel · Answer

We invest in Topeka, and while the houses aren't that sexy, the deals are definitely beating the 1% rule. These are cashflow markets for sure, with very slow appreciation (not including the last two years).

Sam McCormack · Answer

@Wyatt SeidelI, being biased, would recommend Cincinnati. Mix of good cash flow and appreciation in certain areas. Have you looked into Cincinnati?