Greg,
1. How do you analyze properties in areas like this where the market does not fluctuate as much?
- I choose to underwrite all my deals with 0-1% annual appreciation. We are currently experiencing some odd, maybe unprecedented, appreciation in home values and even rents. Who knows if this is sustainable or not? The "make your money when you buy" has held true for me and it's how I go about deciding when/where to acquire. Have multiple, viable exit strategies when you enter into a project and be ready to execute any of those exit strategies when the time comes!
2. Is it a worthy investment during the current economy?
- Sure, if you can find a deal that supports a 10-30% correction in the market then IMO it's a deal worth pursuing during any economic cycle. Be conservative with your estimates, and be as sure as you can be with your numbers (purchase price, rehab costs, holding costs, project timeline, ARV, etc). Have multiple, viable exit strategies when you enter into a project and be ready to execute any of those strategies when the time comes!
Of course these are just my opinions based on my experience, goals and risk-tolerance. Every investor's goals are unique so factor in your own goals and tolerances.
