All Forum Posts by: Art Perkitny

@Ilya Z. glad you fond value in the spreadsheet! I am currently working on adding zip code data to my database. I do have data for Neighborhoods in select cities at the moment, which are about the same in size. 

@Cheree Hill Thanks! 
@Cheree Hill

@Cheree Hill

Hey @Jay S.

South Broadway is going to be largely F level risk based on the data. 

The website you are using, Niche, only scores on an A to D scale, so a C+ average is suggestive of more of a low C, high D level neighborhood. This may actually be a good average score but it's important to break the neighborhood down further.

The further south you going within the neighborhood, the better it becomes. 

Certain small parts of the southern portion can be considered D and even C class.

The graphic below shows what I mean

@Alfred Shoetan cool flowchart, I love breaking things down to logical step by step procedures as you have! 

As for market analysis, here is my 2 cents

I suggest beginning your search by looking at the data, such as demographic data from the Census. This info will give you a decent idea of what to expect and help filter down your search to a few cities.

Metrics that I find valuable to understand are populations total, home values, household income, poverty rate, unemployment, rate and educational attainment. Also, the trend for the aforementioned metrics is also very important.

These are just some of the indicators that will help you understand the quality of an area as well as the tenant profile that you will likely encounter there. 

Once you have selected a couple of macro markets, it's time to repeat the process, but for the sub-markets within your selected locations.

Hope this helps! 

@Jeffrey M. rentometer, as far as I can tell, crawls listings in a radius around the address to ascertain their numbers. 

I suggest corroborating the results you're being given with other sources. For example, below is a distribution of rent rates aggregated by bedrooms. The y-axis is the number of units in Spokane that have rents of a specific range. 

If the numbers match up with what you are seeing then it's looking good, if not there may be more to investigate. 

The data comes from the american community survey  

@Dj Pride, the data is technically correct, however you need to consider if it's really telling you what you're asking.

The data being used comes from the American community survey and vacancies can be further divided as one of seven categories:

- For rent

- Rented, not occupied

- For Sale

- Sold, not occupied 

- Seasonal and rec use 

- Migrant housing

- Other 

As far as Torrington is concerned, here is the data

As you can see, the vacancy rate is similar to the data tabulated at the zip code 06790. 

However this is the vacancy rate for all types of vacant properties (except for seasonal and rec) 

If we want to compute rental vacancy rate, which is what you are looking for, we take the number of for rent properties and divide that by the number of rental properties in the area.   

The answer comes out to be 5.2%, a lot lower than the 10% figure from before. 

Hope this makes sense 

@Heather Carrow the best way to learn a market is to personally go there and speak with local individuals familiar with conditions there. That being said, it's not always feasible to scrutinize every market in this way due to the time that would be spent. I suggest beginning your search by looking at the data, such as demographic data from the Census. This info will give you a decent idea of what to expect and help filter down your search to a few cities.   

Metrics that I find valuable to understand are populations total, home values, household income, poverty rate, unemployment, rate and educational attainment. Also, the trend for the aforementioned metrics is also very important.

Hope this helps  

@Omar Aragon, as @Daniel Kim suggested above, you'll want to figure out your investment goals. Are you buying and holding, or planning on flipping? What are your desired rates of return and what is your risk tolerance? 

You'll want to define these things before beginning your search.

Once you've done that you'll want to begin searching for markets that meet your criteria. 

You said that you are looking for affordable markets. These will largely be confined to the midwest and areas of the south. That being said, there are always going to be smaller markets in other regions as well as submarkets within large metros that may fit you price points.

To aid you I have included the below image showing the median home values of each state. 

I would begin looking at a number of metro areas within the less expensive regions and once you have chosen a few dive into more detail by researching the various submarkets each metro possesses.

Hope this helps with your search!  

@Chaya N. Newburgh definitely has some rougher areas and the data shows a decrease in both total population and home values over the past decade, which is something to consider before investing there. 

Nonetheless, I provide you with this map below that shows the risks grades for the city on an A to F scale based on a number of indicators such as poverty rate, household incomes, and educational attainment. Since you stated that you want to avoid bad tenants and neighborhoods, I would stick to the C and above areas. This will confine you to the northern part of town, near the college and possibly the far west region of the town. 

Hope this helps!

@Saimon Bilalov

In regards to question number 3, specifically on where to invest, I have the following advice: 

I would start by defining my investing goals. That is, what is my appetite for cash flow vs appreciation. Also, how risk averse/affine am I. These parameters will help decide what kind of yields you are searching for, which you can use to filter down your list of macro markets.

Then I would start by looking at the macro market's fundamentals, that is the population, job and income growth over time.

After that, I would look to see what the rents and home prices are and how those are trending as well.

I would do a similar analysis, but at the sub-market level for the metro area you are considering investing in.

Other metrics that I find valuable to understand are household income, poverty, unemployment, and educational attainment. Also, the trend for the aforementioned metrics is also very important.

Hope this helps!

@Dalya M., also wouldn't recommend picking up a 20k property in Akron. 

The areas that do have meaningful inventories of homes at the 20k price point are going to fall into the worst areas in Akron.

The graphic below shows what I mean.

Areas shaded darker have higher concentrations of 20k properties. 

As you can see, most areas are void of these low priced houses but there is an obvious concentration in the south Akron region, which happens to be one of the roughest areas.

- Art