The BIG problem with buying/selling houses in the suburbs!

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The BIG problem with buying/selling houses in the suburbs!

Account Closed
New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes

I'm a 19-year-old college student in Fort Lauderdale, Florida. I recently talked to a doctor who is aspiring to live in Manhattan, New York about real estate.

When I asked him about how I wanted to start investing in real estate in places like Texas, Florida, or Tennessee, he told me that there are lots of problems with investing in these non-cities. Instead, I should strive to go to Manhattan after becoming a dentist. Here are some things he mentioned that make investing not possible in these non-city states:

1. Houses NEVER sell in the suburbs. You have to wait 2 years for houses to sell at the very least.

2. Houses don't appreciate. You will pay a lot of property tax, but your house won't appreciate that much.

3. It's better to invest in a condo in Manhattan, New York than get several houses in the non-cities. (Less work for good condos in Manhattan)

4. If the contractors and the workers get injured when renovating or flipping a house, I will be responsible for all their medical bills. Yikes!

5. It takes too long to renovate houses. (More than 1 year)

6. You won't get a lot of mortgages approved, and will hit your limit.

7. Stuff breaks too much in traditional houses, and the landlord usually pays for electricity, water, garden maintenance, etc. Condos in Manhattan sell like hotcakes.

In sum, he told me why on earth would I go to the suburbs for real estate when I can just buy a condo in New York, have it appreciate a whole lot, and sell it for a way higher price? Although I would be paying more tax in New York, houses appreciate a hell of a lot faster and sell faster. If I invest in the suburbs, I will end up with non-appreciating houses in Texas or Florida, have to fix things all the time, and never be able to sell a house quickly enough.

I read a few books by Brandon Turner, Josh Dorkin, David Greene, JL Collins, and other authors, and it seems like a lot of people I know make a lot of money by investing in the suburbs, but does anyone have the information they would like to share on his views?

Keep in mind that this person I talked to believes that the only 'city' in the US is Manhattan or perhaps Los Angels in California. He thinks that other states like Florida, Texas, and Virginia are all the countryside with not a lot of big buildings where things are very very far apart. He made me think a little hesitant about pursuing real estate investing in the Suburbs, and I would like to know more about this situation!

I'm open to any feedback or criticism! 

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Joe FunariBusiness Member
Real Estate Agent · Keller, TX · Member since 2017 · 850 posts · 825 votes
3y

@Account Closed Wow, what a post. First every REI has a different opinion for what exit strategy works for them. But some of the advise the aspiring doctor gave you about REI is wrong. As as actual investor and realtor working for +5 years helping other investors buy and sell in Texas (Specifically in the Dallas/Ft. Worth area)I feel the need to defend investing in the suburbs. So here goes my rebuttal to your points:

1. SFR's in DFW the average days on market is approximately 30 days for a 3/2/2. I have never seen an SFR stay on the market for 2 years here.

2. SFR's "conservatively" appreciate 5% per annum. That is actually a national average too. Here in the DFW area its higher. But I hedge on conservative numbers. Yes property taxes are around 2.9% here in the DFW area. But the tax rate is based on an average tax "valuation" of $325K for a SFR here in the DFW area. There is no state income tax here in Texas. So tenants can actually afford to pay rents. Plus, property taxes on a LTR are tax deductible.

3. I have no experience with Manhattan condos. So I will defer to other BP experts on this one. But my experience with condos here in the DFW area is that Condo HOA's can vote to change the rules to not allow rentals. I have a client that when they purchased a condo they changed the rules on him. So he can't move to another property and lease it out. Better to buy an SFR in the suburbs with no HOA to be honest.

4. Have your contractors sign an agreement that you are not responsible if they get injured rehabbing one of your properties. But recommend you consult a real estate attorney on such a document. Also, if your working with a good insurance carrier you will have a builders risk policy to protect you as well.

5. The longest it has taken me to rehab a property, whether it is a flip or buy-and-hold exit strategy, has been 4 months. This property was vacant for over a decade and needed to be gutted to the studs, cast iron sewage lines demoed out of the property. A full gut job. But if you work with experienced contractors and/or investors you can get the job done quickly.

6. If your working with a lender that is investor friendly, and preferrably a fellow investor, you will get loans approved. I have both hard money lenders and @Andrew Postell is my preferred conventional lender for LTR's. Andrew is also a fellow investor.

7. You need to understand what the market will bear when determining investing in a buy-and-hold property. Here in the DFW area we include in our lease agreements that tenants do their own lawn maintenance, pay their own utilities, and provide their own fridge, washer, and dryer. Yes, things break. Its a part of cost of doing business as an investor. But these appliances we don't provide tend to break the most. So mitigate your risk.

I will end with defending Texas from a LTR prospective. The landlord laws are among the best in the US. So if your looking to buy-and-hold they are much more favorable than NY. Moving forward get advise on an area your considering investing from an actual investor that works in that area. Not from a doctor who is considering an area and hasn't invested.

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  • Joe FunariBusiness Member
    Real Estate Agent · Keller, TX · Member since 2017 · 850 posts · 825 votes
    3y

    @Account Closed Wow, what a post. First every REI has a different opinion for what exit strategy works for them. But some of the advise the aspiring doctor gave you about REI is wrong. As as actual investor and realtor working for +5 years helping other investors buy and sell in Texas (Specifically in the Dallas/Ft. Worth area)I feel the need to defend investing in the suburbs. So here goes my rebuttal to your points:

    1. SFR's in DFW the average days on market is approximately 30 days for a 3/2/2. I have never seen an SFR stay on the market for 2 years here.

    2. SFR's "conservatively" appreciate 5% per annum. That is actually a national average too. Here in the DFW area its higher. But I hedge on conservative numbers. Yes property taxes are around 2.9% here in the DFW area. But the tax rate is based on an average tax "valuation" of $325K for a SFR here in the DFW area. There is no state income tax here in Texas. So tenants can actually afford to pay rents. Plus, property taxes on a LTR are tax deductible.

    3. I have no experience with Manhattan condos. So I will defer to other BP experts on this one. But my experience with condos here in the DFW area is that Condo HOA's can vote to change the rules to not allow rentals. I have a client that when they purchased a condo they changed the rules on him. So he can't move to another property and lease it out. Better to buy an SFR in the suburbs with no HOA to be honest.

    4. Have your contractors sign an agreement that you are not responsible if they get injured rehabbing one of your properties. But recommend you consult a real estate attorney on such a document. Also, if your working with a good insurance carrier you will have a builders risk policy to protect you as well.

    5. The longest it has taken me to rehab a property, whether it is a flip or buy-and-hold exit strategy, has been 4 months. This property was vacant for over a decade and needed to be gutted to the studs, cast iron sewage lines demoed out of the property. A full gut job. But if you work with experienced contractors and/or investors you can get the job done quickly.

    6. If your working with a lender that is investor friendly, and preferrably a fellow investor, you will get loans approved. I have both hard money lenders and @Andrew Postell is my preferred conventional lender for LTR's. Andrew is also a fellow investor.

    7. You need to understand what the market will bear when determining investing in a buy-and-hold property. Here in the DFW area we include in our lease agreements that tenants do their own lawn maintenance, pay their own utilities, and provide their own fridge, washer, and dryer. Yes, things break. Its a part of cost of doing business as an investor. But these appliances we don't provide tend to break the most. So mitigate your risk.

    I will end with defending Texas from a LTR prospective. The landlord laws are among the best in the US. So if your looking to buy-and-hold they are much more favorable than NY. Moving forward get advise on an area your considering investing from an actual investor that works in that area. Not from a doctor who is considering an area and hasn't invested.

    16Reply
  • Becca F.
    Rental Property Investor · San Francisco Bay Area · Member since 2022 · 1k+ posts · 1k+ votes
    3y

    I have a SFH in an Indianapolis suburb. I bought it about 10 years ago (it was my primary residence) and rented it out instead of selling when I moved to California. I paid such a low price for that house less than a Tesla :) no renovations needed but at some point if when my tenants move out, I'll probably put in quartz countertops and take the carpet out and do LVP floors. It's in a Class A neighborhood with great school district and have high quality tenants. I have a low interest rate so it doesn't make sense to sell it. I disagree with houses not appreciating in suburbs - I don't know the Manhattan or New York market but in Indiana and California suburban houses appreciate, especially in nice areas in California. I get multiple calls/texts each week asking to buy my SFH in Indiana and Bay Area so I think SFHs hold their value.

    I wouldn't buy a condo as an investment property but some people can find condo deals. The ever increasing HOA fees will reduce your cash flow a lot. My method of house hacking in San Francisco Bay Area was to buy a condo, live in it for a few years and rent it out. I wound up selling the condo. The HOA was badly managed and our HOA fees increase 3 times in the 2.5 years while I lived there. Also it was in a city that was very pro-tenant so I decided to cut my losses (didn't do my due diligence so learned a big lesson). I took what little money I got out of it and am buying a SFH. I bought a fully renovated house from a flipper.

    I think the Midwest has great price to rent ratios. For a quick analysis, if you can't meet the 1% rule, it's probably a good deal. For example, if a house costs $100,000 and you can get $1000 rent (1% of the purchase price). 1% is really difficult to hit in expensive markets like NYC, California especially at the higher interest rates and prices now.  My price to rent ratio on the house I put an offer on is 0.76% (projected rent since I haven't closed on the house yet or put it on the rental market yet). If I tried to buy a house in SF Bay Area I'm paying over $800,000 and there's no way I could charge $8000 rent, maybe $4000. There are other metrics to look at besides the 1% rule but it's a quick way to narrow down your search. 

    If you're just starting out, I would think buying in Manhattan or an expensive area is nearly impossible. Also look at an area if it's landlord friendly - I'm going to guess NYC isn't. If it takes months to evict a non-paying tenant or you have to pay them a relocation fee (for example if you want to sell the property or move back in as the owner), be super cautious about buying in those areas. SFHs are easier to get into as a beginning investor. Also there are a lot more SFHs on the market than duplex, triplex or four plex properties. I found hundreds of houses vs. finding 3 duplexes or four plexes in my search. Buying 5 units or larger is buying commercial - haven't looked into that yet. 

    I think the Midwest (Indiana, Ohio) and Tennessee (Memphis is more affordable but Nashville is a hot market for house but prices have gone up) are great rental markets. You can buy turnkey/move in ready for under $180,000. If you want to do a rehab, under $100,000. I also talked to a realtor in Florida who suggested I look in the Panhandle area (Fort Walton Beach, Navarre, Panama City Beach). That area doesn't seem to get hit hard by hurricanes as Miami area. I may consider buying in Florida in the future since it seems like a lot of people are moving there and there's flexibility with buying a SFH as a long-term rental, mid-term rental (to travel nurses and business professionals) and short-term rentals (AirBnbs). Texas is landlord friendly and their homes have appreciated a lot. Property taxes are high but if you can make the numbers work it's a good deal. Good luck!

    10Reply
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    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Joe Funari Thank you for the insightful information! I will definitely take your advice! I'm very new to the world of real estate investing, and it does look like Texas is a good place to start. It sure is assuring since you said that homes will take an average of 30 days, and the 5% appreciation, plus the no-state income tax helps built wealth through real estate in Texas.

     I got a little worried because of the things the doctor mentioned, but it looks like you know a lot about real estate in Texas, especially being an experienced investor. Again, thank you for your help! It looks like I have a long journey ahead :)

    2Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Becca F. Thank you for your story! I love to hear stories like this. I definitely agree with the HOA fees with you a lot! I've seen investors lose cash flow because of the increasing HOA fees. They're lethal!

    Installing LVP Floors and quartz countertops sounds wonderful too. Real estate gets easier to take care of in class-A neighborhoods with good schools nearby. I definitely am looking into the midwest to start, as Manhattan has extremely expensive real estate prices. I would have to save my whole life to afford the down payment😅. As a newbie investor, the midwest sounds like a great place.

    I'm definitely thinking of starting out with some small multifamily houses like duplexes or triplexes. If I can qualify for an FHA Loan, that would work out. Also, the taxes are indeed high, and I would thus have to look for ways to reduce my tax, like a live&flip or the 1031 exchange, if possible. Lastly, short-term rentals and mid-term rentals also sound great! I know there's an AirbnBust situation going on, but I've been following experienced hosts like Sean Rakidzich from Airbnb Automated. I'm sure as the boom and bust cycle continues, things will get better.

    Thank you so much for your insight! I will definitely do some research and due diligence. 

    1Reply
  • Luka Milicevic
    Real Estate Agent · Nashville, TN · Member since 2015 · 2k+ posts · 2k+ votes
    3y

    @Account Closed

    I don't even know where to start....

    This might be some of the dumbest crap I have read on the internet. I would like to meet this doctor that gave you advice so that I can the exact opposite of everything he says

    1. So based on this information, the original buyer is going to own the property for eternity since they never sell? I have bought and sold sooooooooo many houses in the suburbs. I can tell you now....they didn't take 2 years to sell. 

    2. Houses don't appreciate? Really? REALLY? Every house I have ever purchased prior to 2020 has doubled in value. Paying a lot in property taxes is only a factor in places like NY and other super regulated areas that have high property taxes. In TN property taxes are super low. 

    3. Absolutely not true. I would invest in any of the mention places before I ever even consider a condo in NY. 

    4. They should have workers comp and if they don't, you have insurance too. 

    5. I can build a house in less than a year. My partner just finished a full renovation in 9 days. I can do a full gut job in less than 3 months. Cosmetic renovations shouldn't take more than 3 weeks. 

    6. Again, not at all true

    7. Stuff does break, and it's part of thee business. Factor it into your costs. Only time I've ever paid for water was when I had an apartment complex on a single meter. Otherwise I've never paid for utilities. 

    I honestly don't know if this person was being serious or if this is just satire. I would listen to this person just so I could do the exact opposite of what they say. 

    10Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Luka Milicevic Definitely amazed by the speed that you can finish projects! Doing a full gut job in less than 3 months is absolutely spectacular! I'm getting a lot of insightful investors like you that selling homes doesn't take years in the suburbs. Perhaps the doctor only looked at homes that are overpriced. He told me that he heard it from his friends that own some real estate.

    It's also great that you mention property prices prior to 2020 doubled in value. I think the doctor looked at bad markets or bad locations. I also heard that TN property taxes are low, and more affordable for renters and beginner landlords as well. TN is wonderful for real estate investors.

    Thanks for your insight and rebuttal! I'll definitely do some more research into it! I as well think that a first-time investor going to Manhattan is a lot more difficult than going to places like TN where home prices are going up and are more affordable.

    1Reply
  • Adam Martin
    Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes
    3y

    I really hope this Dr. friend knows more about medicine than real estate because he is completely full of bs.  Just because he is a Dr. does not mean he knows real estate and he seems to not.  I didn’t read all the replies but if you have a question on an ailment he may be a benefit but I would avoid talking real estate with him at all costs.  

    8Reply
  • Patricia Drew
    Member since 2020 · 19 posts · 20 votes
    3y

    Hurricanes Michael, Dennis and Opal would like a word.  Those are just the worst of many.  Not as many as South Florida, but not uncommon. 

    Before buying in the Florida Panhandle, get an insurance quote. A policy for a $500,000 home will be in the neighborhood of $6,500 and that's if you're not in a flood zone. Following Hurricane Ian, insurance rates are predicted to go up by 20%-40% in the next year.

    Over four years later, we're still recovering from Hurricane Michael, a Cat 5 that is the fourth strongest recorded storm to ever hit the U.S.  Almost every home in Mexico Beach was destroyed.  I would guess at least 30% of the commercial buildings in the Panama City area sustained severe to catastrophic damage.  

    I think Michael was quickly forgotten by most people because it caused little damage in Panama City Beach.  Had it made landfall 10 miles to the west...

    2Reply
  • Cullen W Jones
    Real Estate Agent · Indianapolis, IN · Member since 2019 · 42 posts · 24 votes
    3y
    Quote from @Becca F.:

    I have a SFH in an Indianapolis suburb. I bought it about 10 years ago (it was my primary residence) and rented it out instead of selling when I moved to California. I paid such a low price for that house less than a Tesla :) no renovations needed but at some point if when my tenants move out, I'll probably put in quartz countertops and take the carpet out and do LVP floors. It's in a Class A neighborhood with great school district and have high quality tenants. I have a low interest rate so it doesn't make sense to sell it. I disagree with houses not appreciating in suburbs - I don't know the Manhattan or New York market but in Indiana and California suburban houses appreciate, especially in nice areas in California. I get multiple calls/texts each week asking to buy my SFH in Indiana and Bay Area so I think SFHs hold their value.

    I wouldn't buy a condo as an investment property but some people can find condo deals. The ever increasing HOA fees will reduce your cash flow a lot. My method of house hacking in San Francisco Bay Area was to buy a condo, live in it for a few years and rent it out. I wound up selling the condo. The HOA was badly managed and our HOA fees increase 3 times in the 2.5 years while I lived there. Also it was in a city that was very pro-tenant so I decided to cut my losses (didn't do my due diligence so learned a big lesson). I took what little money I got out of it and am buying a SFH. I bought a fully renovated house from a flipper.

    I think the Midwest has great price to rent ratios. For a quick analysis, if you can't meet the 1% rule, it's probably a good deal. For example, if a house costs $100,000 and you can get $1000 rent (1% of the purchase price). 1% is really difficult to hit in expensive markets like NYC, California especially at the higher interest rates and prices now.  My price to rent ratio on the house I put an offer on is 0.76% (projected rent since I haven't closed on the house yet or put it on the rental market yet). If I tried to buy a house in SF Bay Area I'm paying over $800,000 and there's no way I could charge $8000 rent, maybe $4000. There are other metrics to look at besides the 1% rule but it's a quick way to narrow down your search. 

    If you're just starting out, I would think buying in Manhattan or an expensive area is nearly impossible. Also look at an area if it's landlord friendly - I'm going to guess NYC isn't. If it takes months to evict a non-paying tenant or you have to pay them a relocation fee (for example if you want to sell the property or move back in as the owner), be super cautious about buying in those areas. SFHs are easier to get into as a beginning investor. Also there are a lot more SFHs on the market than duplex, triplex or four plex properties. I found hundreds of houses vs. finding 3 duplexes or four plexes in my search. Buying 5 units or larger is buying commercial - haven't looked into that yet. 

    I think the Midwest (Indiana, Ohio) and Tennessee (Memphis is more affordable but Nashville is a hot market for house but prices have gone up) are great rental markets. You can buy turnkey/move in ready for under $180,000. If you want to do a rehab, under $100,000. I also talked to a realtor in Florida who suggested I look in the Panhandle area (Fort Walton Beach, Navarre, Panama City Beach). That area doesn't seem to get hit hard by hurricanes as Miami area. I may consider buying in Florida in the future since it seems like a lot of people are moving there and there's flexibility with buying a SFH as a long-term rental, mid-term rental (to travel nurses and business professionals) and short-term rentals (AirBnbs). Texas is landlord friendly and their homes have appreciated a lot. Property taxes are high but if you can make the numbers work it's a good deal. Good luck!


    I agree, the median home value in the Indianapolis Metropolitan Area has appreciated by 27% since January of 2021. Obviously this is uncharacteristic of a "normal market" when speaking about the market historically, and this is due to the unprecedentedly low mortgage rates in the first half of 2022. However, the Indianapolis Metropolitan Area appreciates annually and makes it a great area to invest.

    3Reply
  • Alicia MarksPro Member
    Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
    3y

    Disclaimer: I worked directly with dentists who were entrepreneurs and "invested in real estate". Sometimes they have a singular belief that they themselves can't move past (MB2 canals all should be referenced to endo only comes to mind). This doctor's thinking is very short-sighted because it's what they are comfortable with, but it may not fit your goals. In fact, I see a lot of disadvantages to investing in condos and my buy box is almost exclusively that I don't buy it if I don't own the entire roof. Someone else's negligence becomes your problem, associations are often poorly run, and assessments can hit hard out of nowhere. 

    As for living in Manhattan or another high cost area, unless you plan to go into fee only practices, do high end cosmetic work, etc, your ROI on that expensive dental education isn't great. Insurance payouts are decreasing and overhead is increasing, so it sounds like this is ego driven bad advice on multiple fronts.

    I have seen significant appreciation in the suburbs, and they are often less likely to have significant value swings like you have in downtown areas. My Downtown Los Angeles condo value has swung several hundred thousand in value either way in the 2 years renting it. I've never heard of it taking two years to sell a house in the suburbs, that's straight idiocy.

    Going forward ask this guy about treatment plans, what CEs to pursue for after you graduate to help make you a better clinician, etc., but his real estate advice sounds like a wanna-be ego-driven baller who wants "sexy" properties to brag about at a dinner party with people they don't actually like instead of educating themselves about how to build a long term empire so they don't even have to bend over that perio patient in their op 8 hours a day. I'm not mincing words because I dealt with a lot of these types previously. They'll continue to gripe about all the hours they put into a career they no longer want, but didn't look for the actual exit door opportunities. 

    Happy to chat real estate or DAT and dental school prep/ future of dentistry with you anytime! 

    [email protected]Podcast Guest on Show #204
    6Reply
  • Mark Cruse
    Investor · Fort Washington, MD · Member since 2014 · 1k+ posts · 1k+ votes
    3y

    Not worth really addressing. I dont know if there is substance abuse involved with this individual but I sincerely suggest that you never, under any circumstance seek advice from this person. 

    11Reply
  • Jonathan R McLaughlin
    Rental Property Investor · Boston, Massachusetts (MA) · Member since 2016 · 2k+ posts · 2k+ votes
    3y

    @Account Closed  that guy is an idiot

    5Reply
  • Sarah Ware
    Realtor · Knoxville, TN · Member since 2022 · 28 posts · 16 votes
    3y

    There are a lot of things wrong with the bullet points he mentioned to you. I'll stab at only a few because most have been addressed already. Landlords dont usually pay utilities unless units metered as a group, or it's a STR. Pick a place without natural disasters (here in east Tennessee we have....nothing). Landlord friendly, tax friendly. I'll copy/paste an example I just put on another non-related thread. This might be a higher price point than you are looking for, but compared to Manhattan, much lower-and you could actually use as a get-away when you needed fresh air and relaxing.

    (Sevierville/Smoky Mountains, TN) "....cabin construction yesterday doing a walk through video- priced at $717k, 3/2, that will come with 'luxury finishes'/fully furnished/turn-key when it's completed at the end of March. Now, it's not with the views (tucked in woods) so the price reflects that, but I can see it cash flowing immediately and rental demand is super high."

    2Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    3y

    Your doctor/dentist has some unusual ideas and is clearly invested in condos in Manhattan.  I'm also guessing they are from NY and have never lived outside of that city.

    Condos also have condo fees that while they cover some building maintenance to common areas, also cost a lot and if the condo is poorly managed, it can cause a lot of other problems.

    They are correct about people hitting their limit with DTI and mortgages, but that is a problem you will have anywhere.

    As you read through different posts on BP, you will see the wide range of places where people invest as well as the different type of rentals.

    2Reply
  • Mark F.
    Rental Property Investor · Northern NJ · Member since 2019 · 672 posts · 677 votes
    3y

    Everyone's really hit on the obvious stuff so I'll just add my 2 cents on the overall picture. You're young, impressionable, and talking to someone who is obviously successful in his career so it's understandable you'd respect an opinion from someone like him. I was like this even early in my journey but not young in age, I still took what people said as gospel. Until I got educated and formed my own opinions. You also did not mention if he is an actual real estate investor. That's one thing, if he has zero experience that's the big issue. I've heard people on podcast and the same for my life, how before you invest people say they know someone or tried REI and it's bad and don't do cause you'll go broke, etc. Then you get a few SFR's or units and are doing fine and you tell people and they change their tune. I never take non REI opinion with anything but a grain of salt. You wouldn't take mechanical advice from a teacher would you?

    Even if he has some holdings, everyone has a bias. I'm biased in my area towards house hacking and how I believe wholesalers are worthless in my area (because they are). But I recognize those biases and would never tell someone in Florida or Missouri that overall wholesalers are trash. You need to understand and recognize this guy has some serious biases and his advice as a whole may be flawed.

    2Reply
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    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Alicia Marks Thank you for your amazing insight into real estate for a dentist! I really like your straightforwardness about the doctor wanting "Sexy" properties to brag about! I didn't know that the suburbs were less likely to have a significant value swing versus downtown areas, and is definitely something I would look into when starting to invest in real estate. 

    Hearing from active and experienced real estate investors saying that it doesn't take too long to sell a house(unless in a bad market) is very reassuring. I was worried especially about that because a lot of people I know who don't invest in real estate but own homes say that "They heard from friends who own homes in the US and it's not selling quickly." I will definitely have to do some due diligence.

    I definitely agree with your views on exit door opportunities! I really love learning about real estate, whether through podcasts(your podcast on BiggerPockets Money was amazing!), books, or newspapers and would not want to work a 9-5. I see real estate as a more efficient way to build wealth than by being a dentist. 

    Thank you for your insight! I will definitely love to reach out about my future career, either through being a dentist or real estate or both.

    1Reply
  • Doug SmithPro Member
    Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
    3y

    Poppycock! When I get sick, I go to the doctor. When I have a cavity, I go to the dentist. Beyond that, I wouldn't take real estate advice from either. Florida suburbs are an amazing place to own real estate. There's a reason droves of people are leaving NY for FL. 

    3Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Sarah Ware Thanks for the introduction to Tennessee real estate market! I hear a lot from other real estate investors that places like Texas, Tennessee, and other sunbelt states are growing and is a great places for real estate investors/landlords. 

    It's also great to hear that there aren't a lot of natural disasters in Tennessee. Down here, we get hurricanes, so the insurance prices have skyrocketed and some homes I know had their roof blown off because of the hurricane. Yikes!

    Cabin construction is something I haven't heard that much of, and I will definitely like to learn how that market works as well!

    0Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Theresa Harris Yes! The doctor has lived in Texas for a little while he was probably in school, but mostly, when I talked to him, he was very enthusiastic about living in the middle of Manhattan with an amazing view as a doctor. 

    He didn't seem to like the idea of living in the suburbs because it's not a mega-city and that he would rather live a luxury lifestyle in the middle of manhattan with a few condos driving a range rover. He said living in the suburbs is 'too much work and not a comfortable lifestyle'

    I definitely agree with your DTI and mortgage limit. That is something I will also have to figure out in the future.

    0Reply
  • Jon KellyPro Member
    Investor · Bethlehem, PA · Member since 2016 · 929 posts · 951 votes
    3y

    The most absurd part of the entire post is when you said, ".... who is aspiring to live in Manhattan, New York." 

    Person doesn't even live there and they're telling you what to do with your money. 

    @Account Closed why don't you go invest in the "suburbs" make infinite returns with the BRRRR method and the dentist can invest in your company.

    3Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Mark F. I definitely agree with you that I see other successful people's advice a little more than my own. It's very important to form my own opinions by doing my part of learning about real estate and doing my due diligence. 

    As for the doctor, he doesn't have experience in real estate that much but told me based on what he heard from his friends who work with real estate. I'm unsure if they're real estate investors. I'm really glad I stumbled across BiggerPockets. It's amazing how there are a whole lot of very experienced investors to learn from like you! 

    Thanks for your insight! 

    0Reply
  • Becca F.
    Rental Property Investor · San Francisco Bay Area · Member since 2022 · 1k+ posts · 1k+ votes
    3y
    Quote from @Patricia Drew:

    Hurricanes Michael, Dennis and Opal would like a word.  Those are just the worst of many.  Not as many as South Florida, but not uncommon. 

    Before buying in the Florida Panhandle, get an insurance quote. A policy for a $500,000 home will be in the neighborhood of $6,500 and that's if you're not in a flood zone. Following Hurricane Ian, insurance rates are predicted to go up by 20%-40% in the next year.

    Over four years later, we're still recovering from Hurricane Michael, a Cat 5 that is the fourth strongest recorded storm to ever hit the U.S.  Almost every home in Mexico Beach was destroyed.  I would guess at least 30% of the commercial buildings in the Panama City area sustained severe to catastrophic damage.  

    I think Michael was quickly forgotten by most people because it caused little damage in Panama City Beach.  Had it made landfall 10 miles to the west...


    Yikes! I don't know anything about Florida and so will ask an insurance agent for quotes. This real estate agent was telling me that those areas are appreciating a lot more than Midwest and he didn't mention Hurricane Michael and any building or home damage when I asked.The price points were much higher than Indiana home prices so it wasn't on my radar for making an offer, at least in the next year. 

    1Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Doug Smith True! I definitely wouldn't take advice from people who are unrelated to real estate. The doctor seemed to know a little about real estate investing, and it got me worried a little because he told me houses don't sell in the suburbs. 

    I'll definitely look into the Florida Suburbs. I'm in Fort Lauderdale currently, and people here seem to do be doing well in real estate. I've also heard people in Virginia doing real estate. One of my friend's parents does real estate there, but I didn't know anything about the Virginia Market, but it looks like they're doing extremely well!

    0Reply
  • Carlos Ptriawan
    Member since 2019 · 7k+ posts · 4k+ votes
    3y
    Quote from @Account Closed:

    I'm a 19-year-old college student in Fort Lauderdale, Florida. I recently talked to a doctor who is aspiring to live in Manhattan, New York about real estate.

    When I asked him about how I 

    In sum, he told me why on earth would I go to the suburbs for real estate when I can just buy a condo in New York, have it appreciate a whole lot, and sell it for a way higher price? Although I would be paying more tax in New York, houses appreciate a hell of a lot faster and sell faster. If I invest in the suburbs, I will end up with non-appreciating houses in Texas or Florida, have to fix things all the time, and never be able to sell a house quickly enough.

    He is right, especially if today is 2005 or 1999. The start of RE boom.

    But it's cyclical now that the suburbs may gain more appreciation.

    I give you example.

    In 2005, in bay area the highest appreciation is San Francisco followed by San Jose followed by San Ramon

    In 2023, the highest appreciation is San Ramon, San Jose and San Francisco. SF is falling hard.

    My case to you: don't read Brandon tunner book, dont read people opinion, just open zillow home index every freaking day and you will see a pattern.

    2Reply
  • Account Closed
    OP
    New to Real Estate · Fort Lauderdale, FL · Member since 2022 · 52 posts · 34 votes
    3y

    @Jon Kelly Indeed! I agree that when going into real estate, I'll definitely have to do my best to generate wealth to prove to people who say I'll go bankrupt doing real estate that they are wrong. I heard a lot from other people that I'll be in too much debt, probably go bankrupt, and go live under a bridge eating pigeon poop if I do real estate. Instead, they told me to become a dentist first, then do some real estate on the side 'very safely and steadily.' I am doubtful about getting a 20% loan and saving up until I have 80% cash as I heard. This way doesn't seem too efficient for the best Cash on cash Return on Investment.

    When I get started, I'll definitely invest from the suburbs, probably with the BRRRR method as you said. There's definitely a lot to learn and be knowledgeable about when doing real estate, and I'll have to make sure I plan for the worst but strive for the best.

    Thanks for the great motivation!

    1Reply
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