All Forum Posts by: Austin Wolff

During my day job of Market Analysis here at BiggerPockets, Boise, ID consistently comes up as one of the best markets for real estate investors. Its growth rate is intimidating, and my personal interpretation of the data is that the market is actually still undervalued. 

Thank you for posting this. Even I was unaware about this new zoning law. This opens up so much more opportunity than I previously thought possible. Every out-of-state investor should be paying attention to this.

 Holy smokes, I just checked out your website with the neighborhood ratings. Every out-of-state investor looking into Detroit should take a look at your website!!

Hi Mike, I'm the Market Intelligence Analyst here at BiggerPockets, and as someone who just moved across the country for my own house-hack, I feel qualified to answer this.  

First, I wrote an article regarding this specific question, take a look if you're curious:

The 10 Best Markets for Your First House Hack

Second, if you'd rather do your own research, we created a simple "Where to Start" dataset that includes data such as population, price, and rent growth. You can find that here: https://www.biggerpockets.com/resources/market-data/where-to...

Third, my biggest mistake was not talking to enough property managers to fully understand the rental market. For example, in Los Angeles (where I'm from), rentals are always in high demand. However, in Fayetteville, AR (where I moved), the "leasing season" is in the summer. Demand for rentals is near non-existent in this specific town during the winter, and demand is extremely hot in the summer months. Because most units are rented in the summer anyway, the "median rent" here is basically just a reflection of the rents you can get in the summer, not in the winter (big oops on my part). This is something that even I didn't pick up in my data analysis, and I'm supposed to be the "market analysis guy." Some things you just learn by picking up the phone and talking to boots-on-the-ground.

Long story short, there are many markets that could work (you've alluded to some in your post, and almost every market already mentioned in this thread is a solid pick). But because you're house-hacking, I'd also account for "quality of life" if I were you. Some things matter more than saving an extra $200/month because you chose to live in a market you didn't necessarily like.

Quote from @Joe Hammel:

Metro Detroit has what 99% of Real Estate Investors want. Couple hundred bucks a door monthly cash flow, solid ROI, and yes plenty appreciation. (#1 appreciating city 2023)

I personally make well over $100k/yr cash flow from 21 properties here. All of which, I’ve purchased within the last 4 years.

There are 2 types of people who dog on Detroit..

1. People who don't actually own property in Detroit

2. People who did it wrong and weren't able to execute.

If you do it right, it’s arguably the best market to invest.

Purchase: $80k-$130k

Rent: $1100-$1500 (no rent control in MI)

1% rule: .9%-1.4% rule deals

Coc ROI: 5-12%

Total ROI: 20-40%

Cash flow: $50-$250/door (after all expenses and budgeting for maint, capex, vacancy)

Appreciation: 3-10%+ (has been double digit for a decade)

Location: C+, B-

These numbers are based on the "sweet spot" in Metro Detroit. These are largely in the suburbs and some markets within the city. You can find higher ROI (on paper) here and probably in other cities…but the probability of actually collecting rent significantly decreases. Where these numbers are found, there is a very high rate of rent actually being paid.

We have over a dozen Fortune 500 companies just in Metro Detroit with huge Healthcare, Auto, and mortgage industry National footprints. Ford, Rocket mortgage, Beaumont hospitals and more. All complimented with Amazon fulfillment centers, google, and more tech manufacturing jobs.

The bad reputation of “Detroit” comes from OOS investors wanting sub $40,000, D class properties in poor condition, because they pencil out to 2-3% deals on paper. We don’t buy those.

We have found what works and repeat it as much as funds allow.

Detroit has one the highest rent to price ratios in the country…and we focus on the best balance of price/location within the area.

Here is a picture of my portfolio if you/anyone is curious.

 Wow Joe, this is absolutely incredible, thank you for sharing. For your Taylor property on Cornell (purchased 2023), the loan is higher than the purchase price (I'm assuming to help cover the rehab). What kind of loan did you use? Would you consider that town a "B" place or a "C" place?

 Wonderful, thanks for the feedback!

Location matters. There could be a lot of new builds going up in the outskirts of a city, but existing properties in the city closer to amenities may still be desirable. 

In my opinion, it can be a sign of builder/investor confidence in a given area if they're willing to put up the capital to build new homes in a given area: they believe there will be enough demand to sell their new products.

Hey investors, I'm the new Market Intelligence Analyst here at BiggerPockets, and I'm developing a way to predict the future "path of progress" for a given market. Since I was born and raised in Phoenix, I figured I'd start there. 

Is the map below helpful or useful? 

Here's an interactive version of the map, where you can zoom in and see more information such as population and population per acre: https://www.datawrapper.de/_/jDwi4/

It tracks the change in population density (population/acre) for each neighborhood (census tract) in the Phoenix MSA from 2010-2020. The darker the blue, the higher the change in population density. Clusters of dark blue areas (such as Queen Creek, Buckeye-Goodyear, area between Surprise and Anthem) may indicate the path of progress happened (or is still happening in these areas), and we might be able to assume the path of progress could continue in these directions.

Do you find this kind of information helpful at all? If so, please let me know. If no one finds it helpful, I won't bother with predicting future "paths of progress."

Define underground? You live in one of the best cash-flowing-yet-still-appreciating states in the nation, near two of the some of the best growing economies (Cincinnati and Columbus). All things considered, that's how I'd define "underground." Unless you mean secondary and tertiary markets--I'd consider sub-markets near these two metros in that case. You live in a wonderful area, arguably top 10 when it comes to affordability and growth. Please take advantage of that.

 Out of state may be your best bet, everyone on this thread has suggested great markets. If you'd like to keep your investments in California, Sacramento is starting to look more attractive, especially since the market has seen an increase in tech jobs.

 100% agreed!