Hi everyone!
Quick update! I did travel down to Huntsville in November and purchased 2 homes. There seems to be a lot of development going on in the area, with possibility of long term appreciation. I was surprised that downtown Huntsville was still relatively small, I guess I was expecting a slightly larger downtown area. However, with the plans for expansion and the growth the area is seeing, I think its a great market. We drove around a lot! Definitely a lot of development heading towards Madison. I did look in the Lowe Mills area, but it definitely seems like it has a ways to go and there wasn't anything that interested me in the area at that time.
I have had the best experience with the team I have now in place down there. I can't say enough about @Carolyn Dietrich and her team and John White the agent that we used to purchase the homes. John is a real estate investor in the area and has also lived in Huntsville his whole life. He was very purposeful in the properties he showed us giving us lots of information about what might make a good investment and the houses that would cash flow vs appreciate. The difference between the areas and also helping us get estimates, home inspectors, video walk-through tours of properties that we may want to purchase, a true pro and I wouldn't use anyone else in that area!
Carolyn Dietrich is the property management company that we are using for both of our properties and they are phenomenal! One of the properties I purchased was a foreclosure, I don't think I would do this again btw, and they have been unbelievably helpful. They helped with all the repairs, getting the property ready to list for rent, handled the rental process from start to finish and continue to be supportive throughout the process. I am truly just the owner on both properties and they are the landlords. It's a great sense of relief knowing its taken care of since I'm so far away.
Also have to say one last thing... Willie Tucker was the lender we used down there and he was great! Smooth and easy, absolutely no hiccups on either property.
The two homes I bought were very different. One was turn key in the Harvest area. Tenant in place, purchased the home below market, other than replacing the fence this month, there have not been any issues what so ever. This property doesn't cash flow as well and the tenant's rent is slightly below the current market rates, but for me, this was a great purchase. Over time the rent will increase, the tenant is great and wants to stay long term and for me, cash flow is important, but not the only thing that matters. I would purchase more like this one for sure.
The second property I bought was the foreclosure in Madison. I made some mistakes here... Mainly because I bought two properties at once and that took up a lot of cash and then the repairs were more extensive than I anticipated. I think I paid closer to retail on this property too. The condition wasn't great, but it wasn't terrible either and it was in a very desirable area, so I think I was competing against primary home owners. I didn't follow the numbers on this and probably overpaid a bit from and investors perspective. And it has been one thing after another.... but once I get the kinks out it will be a great cash flow property. I was fortunate to have cash on hand to make the repairs, but I could see how this process could sink a first time investor and have them never buy another one again! It did rent within 30 days and my mortgage payment is around $850 with a monthly rental rate of $1350. So again, great cash flow eventually.
Last "mistake" I think I made was getting to focus on the interest rates. I ended up putting 25% down on both properties because it made an impact on the rates, but I think keeping more cash and not worrying about the rates as much may have been the right choice. The tenants are paying the interest, so as long as the properties cash flow, keeping more cash in pocket seems like the right decision.
Hope this was helpful! I plan to buy one more in that area this year!
