Newbie, trying to find a location to invest, frustrated!

[Vince Au]

It's 2025 and I'm going to get serious about investing. Several years prior to Covid I got my finances in order to start investing. Unfortunately, Covid decided to change my plans, and I made the decision to hold off, in hindsight it was a huge mistake and no one could have imagined that property values could have increased at such a high rate. I'm self-employed and did not know if my business was going to be shut down due to the virus. During 2020 to 2022 I was fighting to keep my business profitable as materials and labor came in short supply and eventually led to the inflation we're seeing now. It seems like an uphill battle and I'm always putting out fires. I wasn't going to let this deter me so I began looking for deals but the numbers just didn't pan out. I wanted to leverage as much as I can with the equity that I have on other properties that I have in my portfolio to use as a down payment for the investment properties. There isn't enough cash flow in these deals to pay the mortgage, monthly expenses and the HELOC that I'm trying to leverage against. There's a lot of info here on BP and I'm just trying to take it one step at a time in the "Get started" section of the website. I'm not sure if the deals are just difficult at the end of 2024 in to 2025 or I'm just inexperienced. I'm also concerned about the real estate market as a whole. The sentiment feels a lot like 2008, home prices are unaffordable, Price to earning ratio don't make sense, rents are high (which is a goo thing only of the homes weren't so expensive), I feel like it's a ticking time bomb with the debt crisis. Am I paranoid and just making excuses and being too cautious? Being cautious has caused me to miss some great opportunities in the past 4 years. I do have some investment experience and I'm currently managing 1 property, all the numbers are great and there's a good amount of cash flow and long term growth so I'm not a total green horn. Any guidance and feed back on my frustration at this moment would be appreciated.

[Melissa Justice]

Hello @Vince Au,

Thank you for sharing your story here. I admire your steadfastness and perseverance during those volatile, uncertain times and continuing to have a great, positive attitude.

In regard to REI investing currently - There are great real estate investment opportunities across different markets, especially in the Midwest and Southeast. These areas not only offer reasonable purchase prices for most investors but also feature turnkey homes—either newly built or fully renovated, ready for tenants, with systems that still have 10+ years of life remaining, and property management teams in place. In addition, these markets are seeing both home values and rents appreciate.

Cash flow from a property will depend on your down payment. A smaller down payment could result in breaking even or even a negative cash flow. However, some investors are fine with this strategy if they prefer to minimize their upfront investment and plan to refinance in a few years, especially with potential interest rate cuts from the Fed this year.

At the end of the day, it’s all about investing in a growing market, selecting a solid neighborhood, and building a strong team to support you. It can take a lot of time and effort if you go it alone, so having a trusted team can be a huge advantage. Our team at Rent to Retirement has been helping investors with this for over a decade, and we’re here to assist you too. If you have any questions about market analysis or how to get started, feel free to reach out. Above all, choose a market that aligns with your goals! Don't let "analysis-paralysis" prevent you from your next great deal(s)!

Wishing you success,
Melissa
Rent to Retirement Investment Strategist