All Forum Posts by: Tom Wagner

Interested to hear why you want to target those areas specifically? And what type of monthly-rent to purchase price ratios are you seeing in the 2-4 unit space in those areas? For example, if you bought a $1mm duplex how much would it rent for? Keep in mind you'll have to pass the FHA self-sufficiency test if you utilize an FHA loan on a 3- or 4-unit property, which seems like a tall order in this area.

I have not bought property in any of them, but can see myself settling in Southern CA so will be following this thread closely.

From the reading I've done, I've formed the opinion that Opportunity Zones are one of the most powerful tools for wealth generation to come around in a long time. The value of both decreasing existing capital gains while also benefitting from tax-free appreciation cannot be overstated.

One question I'd have is whether they are going to go away. I've read about the laws changing in 2025 or 2027. Can anyone point me towards documentation about what happens when this initial period ends? And has either major party come out in favor of or opposed to extending QOZ rules?

Is there something about Pensacola that makes it harder hit than the rest of the country by unemployment?

Japeth, great to hear you are not letting your location slow down your investing! In my opinion, it is hard to overstate how important picking the right city to invest in is. And what the "right" city to invest in depends on what you are looking for. Are you looking for cash flow -- so maybe Cleveland, Memphis, Milwaukee, small towns, etc. ? Or are you looking for appreciation -- so maybe San Diego, Austin, Denver, etc.

I haven't started out-of-state investing yet but to me the sweet spot is a city that cash flows well with the *potential* for major appreciation. Charlotte, Atlanta, Jacksonville, Minneapolis, Kansas City, Columbus and Pittsburgh are a few that come to mind.

Good luck and keep us posted!

Hi Aaron -- welcome to the real estate world! I'm also in Minneapolis (for now) so will be curious to see what you end up buying. Couple things, some of which may go against the conventional wisdom of this website.

- Having roommates to help you pay down the rental property is a perfectly valid, tried-and-true strategy

- Regarding neighborhood, in Minneapolis with $250k to work with I would focus on Northeast Minneapolis. The amount of development occurring up there (breweries, apartments, etc) is astounding.

- I would take a hard look at buying a duplex or triplex with an FHA loan. It would likely allow you buy a $400,000+ property because you can use projected rents from the other units as income to qualify. It also allows you to just put 3.5% down, leaving more liquidity and cash reserves in case something goes wrong. Rates are at an all-time low and there are plenty of properties in Minneapolis that meet the 1% rule. My two cents -- happy to discuss more if you'd like!

Following! I'm under contract on a $1mm fourplex in Jersey City, NJ now and my biggest concern is a tenant or multiple tenants just completely halting rent payments. Like much of the country, there is an eviction moratorium in NJ, so it has never been more important to screen tenants properly and carefully.

I am also Minneapolis based (for the time being) and I have a long-term goal to develop some property here. However, I think it would be much safer to get your feet wet on a few six-figure deals before hopping into the $1mm+ bracket. Learn and make mistakes while the stakes are low, then level up as you get more comfortable.

Former accountant turned Software Engineer here! I think a lot of real estate investors are engineers because engineers are paid well enough to be able to invest $20k+ per year into real estate. That is a luxury not enabled by many professions!

I'm not seeing a signature for you on this post, and I'm not seeing a signature on my posts either. Trying to figure this out as well!

Edit: Got it all sorted out. Follow the instructions detailed here: https://www.biggerpockets.com/faq/what-is-allowed-in-my-forum-signature

I'd put it $800,000+ in an irrevocable trust for five years at 2% interest and spend time studying, reflecting, learning and listening before making any rash decisions. More important to make the right decision than act quickly!