All Forum Posts by: Greg Johns

Nice work!  I lived in Sonoma (town of) for several years and live in Berkeley now.  The high cost of property means we are renters.  Because of this insanely expensive market, we are looking to invest in rental properties OOS and Cleveland is one of three market "finalists" that we are doing more research on.  Right now, my biggest concern is whether the properties will hold their value over time.  When I look at the history of what a property sold for in the past, it's not very encouraging.  Anyway, I'll be sure to check out your blog!  

Thanks for the insight!  It sounds like finding a company that can provide all of the services is the general preference, particularly for out-of-state investors.  But I can definitely see the drawback if you don't like one part of their service and you are "bought into" a bundled package of services (kind of like cable companies' "triple play" packages, lol).

The important thing for me from these responses is that there is no bias against using a full-service company.  So if I find one I like, I won't be going against conventional wisdom by using them.

Thanks everybody!

Hello all,

I am about to jump back into real estate investing with the goal of purchasing turn-key rentals.  I live in Cali, but will be investing out-of-state.  As I begin to put together my "investment team" in each local market I am analyzing, I wonder whether it is best to assemble members from different companies (i.e. using a real estate agent from one company and a property manager from a different one) or if it is OK to go with one company that offers a wide range of services (a "one-stop shop")?

Do y'all have any thoughts on this?  Are there conflict of interest concerns in using one company that offers a range of services?

Thanks!

These are great!  Thanks!  

One question I have is how to quantify something like "diversity of business types"?  Is there a specific metric available that can be compared across different areas? 

 Some indicators like "nearby universities" can be completed with a simple "yes" or "no".  And then you could add in "number of colleges/universities in the area".  Of course, then you have to define "the area", but at that point, you are really getting into the weeds of the analysis.

My market analysis spreadsheet is getting VERY large and I feel myself slowly becoming a "data nerd", lol.

 Yeah, that popped into my head as I was looking for plane tickets to go back east to visit my parents this Spring.  I thought "oh snap, I need to be able to get to these markets easily, without having to take a flight that has 3 stops with significant layovers or uncomfortably close connections.

Hi All,

I live in the SF Bay area and because of the crazy real estate market here, I am looking out-of-state to restart my real estate investment portfolio.  Because I am not investing in my local market, I am going to need to come up with a systematic and objective way to evaluate other markets to determine which markets have the characteristics that will generally be favorable for the type of real estate investing I want to do.  

This analysis will help me "green light" or "red light" different markets.  For the markets I determine are "green light" markets, I will then start a dual parallel-track process of checking investment opportunities to see if the numbers work (generally speaking) and contacting and interviewing property managers to get their take on the market and begin building out a potential team of local "foot soldiers".

The mind dump of metrics I came up with for my analysis so far are (in no particular order):

• Recent Population growth (2010-2013)
• Median gross monthly rent (2013)
• Median gross monthly rent 3-year change (2010-2013)
• Vacancy rate (2013)
• 3-Year change in vacancy rate (through 2013)
• Rent as % of income (i.e. median monthly gross rent as a fraction of median household income)
• 3-Year change of rent as % of income
• % of households that are renters
• 3-Year change in % of households that are renters
• Median price for all SFHs (December 2014)
• 3-Year change in median price for all SFHs (through December 2014)
• Median price for all 3BR units (December 2014)
• 3-Year change in median price for all 3BR units (through December 2014)
• Median price for all 2BR units (December 2014)
• 3-Year change in median price for all 2BR units (through December 2014)
• Median gross annual rent (i.e. monthly gross rent * 12) / Median price for all homes - I know I am kinda mixing apples and oranges here, but it's the closest I can get using available objective data
• Unemployment rate
• 3-Year change in unemployment rate
• GDP growth (time period depends on data available)
• Job growth (time period depends on data available)
• Household income growth (time period depends on data available)
• Proximity to major international airport (i.e. how easy will it be for me to get there?)

My plan is to spread this data for about 15 different metro areas and compare the results.  Based on those results, I'll identify my top 5 metro areas into which I'll do more research about specific investment opportunities.  My investment strategy is to buy and hold rental properties long term for monthly cash flow and this will be the basis for which I identify my top 5 metro areas.

Can anyone think of any other metrics I should look at when evaluating different real estate markets?

Thanks!

Greg

Thanks for the summary @Ali Boone .  There are a LOT of RE markets to look at and it's great to have someplace to start.

Thanks for the offer Tim (I couldn't get the tag to work, lol)!  I'll definitely reach out before I make any moves on the Cleveland market.

@Curt Davis , I should clarify.  I haven't eliminated Memphis.  I've only dropped it down on my priority list.  I need to pick somewhere to start my research and based on the comments I've seen on here, I've concluded that it might be best for me to start with some of the other cities.  So right now, it's all about figuring out where to start my research.  I haven't yet gotten to the question of where I'm going to actually buy yet, lol.

Thanks to all of you for the warm welcome.  I had been lurking here for a little while and am not at all surprised by the response.  I am looking forward to giving back to this community as much as I am benefitting from it.

At this point, my short list of potential markets is focused in the mid-west cities of Indianapolis, Columbus OH, and Cleveland OH. I had Memphis on my list, but after reading the feedback from many of the members here, I dropped that market off my list for now, especially for my initial re-entry into the world of REI.

@Larry Fried , @Mehran K. , I have seen a LOT of West coast investors looking east for opportunities.  Where do you guys focus your investing and how has that list evolved over the time you've been investing?  How have you found the ability to keep tabs on your properties from out of state?  Feel free to reply by PM if you think it is more appropriate.

I will definitely look for an REI group here in NorCal to connect with as I imagine that will provide me with a wealth of solid referrals, which will be critical as I begin to build me "team".

Thanks again for the warm welcome and wishes for success!

Hello Everybody!

My name is Greg and I'm new to the Bigger Pockets community.  I live in Berkeley, CA and after a long hiatus from real estate investing, my wife and I are ready to test the waters again.  

I started investing in real estate about 15 years ago in Jersey City, NJ after reading RDPD.  Back then, we focused on multi-family rentals that needed some rehab.  At that time, downtown Jersey City was still considered "sketchy" and "questionable".  We got a taste of long distance investing by buying a couple of rental properties in Lancaster, PA.  After a few years, we decided to cash out and buy a hospitality-related business in the Northern CA Wine Country.  Things went well for us the first few years, but the severity of the Great Recession (and explosion of the housing bubble) proved to great.  We closed the business and were literally sent back to square one.

After 5 long years of rebuilding ourselves, we are finally at a point where we feel we can begin to get back into real estate investing, as we both still believe that investing in real estate is our ticket to early retirement from the rat race and have a nest egg large enough to outlast us by many years.

This time around, we plan to focus purely on buy-and-hold rental properties (long-term and vacation rentals).  The days of chasing appreciation are over for us.  Because of the outrageous housing prices in the Bay area, we realize that we'll likely have to be long-distance investors.  We've identified a number of markets to research and look forward to jumping into the pool again. We know our biggest hurdle will be financing our investments, but for a number of reasons, we feel that now is the time.

I am a financial analyst by trade and work for a non-profit in SF.  As such, I probably spend way too much time "running the numbers", but I am who I am, lol.

I was excited to find this community of investors and look forward to getting to know you and exchanging knowledge!

Cheers!

Greg