Hello, my name is Kirk Garner from Clemmons, NC. I am looking to buy long-term rental properties as a source of income from now through retirement that will leave a legacy for my two daughters.
Welcome to the BP community! Are you looking to purchase rentals in NC? Have you heard of DSCR loans? DSCR (Debt Service Coverage Ratio) loans will be a great tool for you to utilize for your rental properties. They can close fairly quickly and you can put them through an LLC to protect your other assets. I would love to connect, I am going to send you a message so we can chat further.
Real Estate Agent · Memphis, TN · Member since 2019 · 365 posts · 264 votes
2y
@Kirk Garner welcome to the forums Kirk. The southern/middle part of the country is a great place to invest, not only is it affordable but the landllord laws are very friendly. I work with hundreds of out of state clients who invest passively. Memphis is a great rental market.
Feel free to reach out if I can be of any assistance. Best of luck investing!
Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
2y
@Kirk Garner here's our standard copy & paste food for thought:)
.
Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.
If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.
So, when investing in areas they don’t really know, investors should research the different property Class submarkets.
Here’s our OPINION for the Metro Detroit market (use as a template for your target area!) that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases.:
Class A Properties: Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation. Vacancy Est: Historically 10%, 5% the more recent norm. Tenant Pool: Majority will have FICO scores of 680+, zero evictions in last 7 years.
Class B Properties: Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation. Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support. Tenant Pool: Majority will have FICO scores of 620-680, some blemishes, but should have no evictions in last 5 years
Class CProperties: Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation. Can try to reposition to Class B, but neighborhood may impede these efforts. Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages. Tenant Pool: majority will have FICO scores of 560-620, many blemishes, but should have no evictions in last 2 years. Verifying last 2 years of rental history very important! Also, focus on 2 years of job/income stability.
Class DProperties: Cashflow vs Appreciation: Typically, all cashflow with zero or negative relative rent & value appreciation Vacancy Est: 20%+ should be used to cover nonpayment, evictions & damages. Tenant Pool: majority will have FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, recent evictions. Verifying last 2 years of rental history and income extremely important to find the “best of the worst”.
Make sure you understand the Class of properties you are looking at and the corresponding results to expect.
Lender · Orlando, FL · Member since 2023 · 220 posts · 183 votes
2y
Hey Kirk,
Welcome to the BiggerPockets community! As a fellow member of NCREIA (North Carolina Real Estate Investors Association), I strongly encourage you, as a new investor, to consider attending one of our monthly meetings. These gatherings provide an invaluable opportunity to connect with like-minded individuals in your local market who can offer firsthand advice and insights to support you on your real estate journey.
Similar to the wealth of resources available within the BiggerPockets community, NCREIA offers a multitude of tools and resources to assist you in your endeavors. Should you ever wish to discuss strategies for achieving your real estate goals, please don't hesitate to reach out. I'm here to lend a helping hand and share experiences that can help propel you toward success in the real estate realm.
Logical Property Management4.9453 Reviews
Reafco - Samuel Diouf528 Reviews