Investor · NorCal, Investing out of state · Member since 2025 · 15 posts · 28 votes
Hello BiggerPockets fam! I live in Northern California and am looking to step into real estate investing by purchasing my first rental property. I have ~ $400k cash available and am willing to buy property with cash down, with a long-term goal of building my portfolio over the next 5 years. Here is what I am contemplating and would like some advice:
1) I want to focus on building a high cash flow. Given the interest rates are high, I am looking at acquiring around 2 properties with cash. Is this prudent, or should I still look into a mortgage and maybe acquire more properties?
2) I have started looking into Indianapolis to start. Higher cash flow areas generally have a C tenant pool, and homes are built in the 1900s. I am worried about high maintenance costs and tenant issues. I am also seeing homes sitting on the market for many days, what does this mean?
3) I looked into Columbus, OH, and read feedback that the property management options are not good. Being out of state, I am concerned about this. Without a good property manager, I cannot sustain an out-of-state investment.
4) I don't know what other markets to consider where there is rental/population growth, has high cash flow, a B-grade tenant pool, and not so old properties. Is this a unicorn?
Looking for advice based on your personal and recent investment experiences, thank you!
Hi, I'm in the Bay Area. Please read some of my previous posts/comments. I invest in the Bay Area and Indianapolis metro area. For context I did live in Indiana so I didn't just pick a random market 2000 miles away
1) There is no high cash flow now with 7% interest rates. Investing is much more difficult now than from 2010 to 2021. If I were you I wouldn't pay all cash and lock up all your money.
2) Indianapolis: Class A suburbs: Hamilton County (Carmel, Westfield, Fishers, Noblesville) and west side suburbs (Plainfield, Danville, Brownsburg), Southside suburb: Greenwood. Indy the city: Broad Ripple. I own in Hamilton County but I bought in in 2013 so different market back then - newer home, great tenants, great school district.
Don't buy Class C - you're better off leaving your money in a high yield savings account or buying some index funds. I own two of those (sold vacant one last fall). The one I have loses money each month, -$300 to -$500 from repairs. My tenant pays the rent every month, thankfully. You are exactly right on your observations with Class C having problems, homes built in 1900s are over 100 years old even though they're "renovated". Property management fees are 10% of monthly rent.
I'd guess if it has many days on market it's not highly desirable property area or home. I think a lot of these Class C investors are passing them around like a "hot potato", buy one, not a good investment, sell it, another investor buys.
3) Don't know anything about Columbus but all the problems that Class C has could apply to at least 20 cities in the Midwest and South. I wouldn't just base your decision on a spreadsheet. Fly to these areas multiple times and establish a team in person. Things look a lot different in real life than on video/photos. Talk to local investors - they live there so they can give the pros and cons.
Maybe consider Sacramento? I'm not sure what part of NorCal you're in. If you buy a duplex and rent out one side as a long term rental and other side as mid-term rental (business travelers, travel nurses, etc) you might get some cash flow.
I'm looking at Nevada, looked at Reno and will look at Vegas soon. Price points $400,000 to $550,000. If I had to do it over again, I'd buy one high quality home rather than 2 cheaper older ones with problems. Nevada has low property taxes - the tax rate is lower than many Midwest states
A few of the California investors I've talked to recently bought in Vegas and Utah (Saratoga Springs and Lehi) - new builds. You get a lower interest rate from the builder and there's a warranty so hopefully your capital expenses won't happen at least further down the line (HVAC, water heater, new roof, etc).
I"m a W2 employee, not in the real estate industry and don't make any money for helping you or giving you my contact names. DM me if you have questions. Good luck :)
Real Estate Agent · Member since 2022 · 1k+ posts · 1k+ votes
1y
Great questions, Poojitha! Paying cash for a couple properties can be a solid way to start, especially with today’s rates. Just keep in mind, using some leverage later on could help you scale faster if that’s your goal.
High cash flow areas often come with older homes and more active management, so it’s smart to factor in extra reserves and strong local support. If homes are sitting longer, it could be the market cooling or just pricing. It's always worth looking closer at specific neighborhoods.
It’s tough to find the perfect mix of growth, good tenants, newer homes and strong returns, but not impossible. Sometimes just tweaking your location or approach can get you close.
Happy to keep the conversation going if you want to bounce around ideas or scenarios.
Hi, I'm in the Bay Area. Please read some of my previous posts/comments. I invest in the Bay Area and Indianapolis metro area. For context I did live in Indiana so I didn't just pick a random market 2000 miles away
1) There is no high cash flow now with 7% interest rates. Investing is much more difficult now than from 2010 to 2021. If I were you I wouldn't pay all cash and lock up all your money.
2) Indianapolis: Class A suburbs: Hamilton County (Carmel, Westfield, Fishers, Noblesville) and west side suburbs (Plainfield, Danville, Brownsburg), Southside suburb: Greenwood. Indy the city: Broad Ripple. I own in Hamilton County but I bought in in 2013 so different market back then - newer home, great tenants, great school district.
Don't buy Class C - you're better off leaving your money in a high yield savings account or buying some index funds. I own two of those (sold vacant one last fall). The one I have loses money each month, -$300 to -$500 from repairs. My tenant pays the rent every month, thankfully. You are exactly right on your observations with Class C having problems, homes built in 1900s are over 100 years old even though they're "renovated". Property management fees are 10% of monthly rent.
I'd guess if it has many days on market it's not highly desirable property area or home. I think a lot of these Class C investors are passing them around like a "hot potato", buy one, not a good investment, sell it, another investor buys.
3) Don't know anything about Columbus but all the problems that Class C has could apply to at least 20 cities in the Midwest and South. I wouldn't just base your decision on a spreadsheet. Fly to these areas multiple times and establish a team in person. Things look a lot different in real life than on video/photos. Talk to local investors - they live there so they can give the pros and cons.
Maybe consider Sacramento? I'm not sure what part of NorCal you're in. If you buy a duplex and rent out one side as a long term rental and other side as mid-term rental (business travelers, travel nurses, etc) you might get some cash flow.
I'm looking at Nevada, looked at Reno and will look at Vegas soon. Price points $400,000 to $550,000. If I had to do it over again, I'd buy one high quality home rather than 2 cheaper older ones with problems. Nevada has low property taxes - the tax rate is lower than many Midwest states
A few of the California investors I've talked to recently bought in Vegas and Utah (Saratoga Springs and Lehi) - new builds. You get a lower interest rate from the builder and there's a warranty so hopefully your capital expenses won't happen at least further down the line (HVAC, water heater, new roof, etc).
I"m a W2 employee, not in the real estate industry and don't make any money for helping you or giving you my contact names. DM me if you have questions. Good luck :)
Lender · Cincinnati, OH · Member since 2025 · 58 posts · 23 votes
1y
Hello Poojitha, nice to meet you. I am a lender and actually am licensed in two states you're looking into investing (Ohio and Indiana). Your strategy is multi-faceted for sure. From a lending perspective, a DSCR loan, which you qualify solely on rental income, is likely the best mortgage solution for you if you don't pay cash. I'd be happy to connect offline as well. Feel free to DM me.
New to Real Estate · Miami, FL · Member since 2024 · 1k+ posts · 455 votes
1y
You're thinking smart, and with $400k cash, you’ve got solid footing.
Buying two properties outright will give strong cash flow, but using some leverage can help you scale faster and keep liquidity for repairs or new deals. Don’t avoid financing just because rates are high balance is key.
Indy offers yield, but many homes are old and high-maintenance. Homes sitting long could signal weak demand or overpricing, proceed carefully.
Columbus has potential, but poor property management can sink an out-of-state deal. Vet managers before committing.
You’re not chasing a unicorn look at places like Jacksonville FL, Charlotte NC, or Knoxville TN. These offer growing populations, B-class tenants, newer inventory, and decent returns.
Good luck & feel free to reach out if you need any help!
Hello BiggerPockets fam! I live in Northern California and am looking to step into real estate investing by purchasing my first rental property. I have ~ $400k cash available and am willing to buy property with cash down, with a long-term goal of building my portfolio over the next 5 years. Here is what I am contemplating and would like some advice:
1) I want to focus on building a high cash flow. Given the interest rates are high, I am looking at acquiring around 2 properties with cash. Is this prudent, or should I still look into a mortgage and maybe acquire more properties?
2) I have started looking into Indianapolis to start. Higher cash flow areas generally have a C tenant pool, and homes are built in the 1900s. I am worried about high maintenance costs and tenant issues. I am also seeing homes sitting on the market for many days, what does this mean?
3) I looked into Columbus, OH, and read feedback that the property management options are not good. Being out of state, I am concerned about this. Without a good property manager, I cannot sustain an out-of-state investment.
4) I don't know what other markets to consider where there is rental/population growth, has high cash flow, a B-grade tenant pool, and not so old properties. Is this a unicorn?
Looking for advice based on your personal and recent investment experiences, thank you!
3 - There are some good and some bad pms in Columbus, OH. I believe a lot of the fault lies with the investor when they buy the property, hire the property manager. Then they think they do not need to manage the property manager
Real Estate Agent · Columbus & Cleveland, OH · Member since 2023 · 1k+ posts · 1k+ votes
1y
Hey Poojitha, the reality is that most B grade areas aren't going to have the best cash-flow, if any. That doesn't mean that there aren't great deals in every market you just need to make sure you have realistic standards.
A lot of the older homes were built very well and should last another 100 years at least as long as there are no structural issues.
As for bad reviews of PM companies, there are a couple great PM companies in Columbus, and I'd be glad to send you some referrals.
I would make sure to read the reviews themselves as a lot of people are leaving bad reviews on these companies because they either had a bad experience with real estate and want to point fingers or are unhappy tenants.
There is some very good advice here in some of the other posts. I would concur with other people the allure of cash flow in a class C property may look nice upfront, but many investors find that maintenance and management costs end up eating up much of the cash flow.
I also agree with @Drago Stanimirovic, when I work with investors, I suggest looking in the same markets. Find markets that have strong population growth and employment growth. With this, you can get good appreciation on a class B property. With the right purchase incentives, you may be able to not only get cash flow, but strong appreciation. With the money you're looking to deploy I would suggest that you look at the Build to Rent strategy. With buying new construction, you're able to get better incentives than the secondary market and a property that will require much less ongoing capital to keep up. It also typically offers better tenants and stronger appreciation than older properties.
I am currently working with builders who are looking to liquidate properties in both of Charlotte and Jacksonville market that may be just the unicorn you're looking for.
Feel free to connect if I if you think I can help answer more questions.
Welcome to Bigger Pockets! I work with a lot of California clients that have the same goals as you and are killing it here in Memphis! Have you looked into our market? We have a very strong blue collar workforce that consistently drives a high demand for rental properties. Memphis is cash flow king and if you are looking for a solid out of state market, now is a great time to get started. We've begun to see a market shift that is allowing you as a buyer to get better and better deals. Inventory is up, sellers are motivated, and if you're an investor looking for cash flow, Memphis is the place to do it.
I wanted to jump in specifically regarding your concern about property management in Columbus, OH. You’re absolutely right that having a solid property manager is non-negotiable, especially when investing out of state. Unfortunately, it’s a common challenge that many investors hear mixed feedback about Columbus property management companies.
The reality is, Columbus is a growing market with strong fundamentals for long-term rental investments, but many property managers here are still operating with outdated models—limited transparency, reactive maintenance, and communication gaps that leave owners feeling like they’re “managing the managers.”
However, there are companies (ours included) that specialize in working with remote investors, offering tech-driven solutions like real-time reporting, live maintenance updates, and a proactive management approach designed for owners who don’t live near their properties. We work best with investors who want hands-off operations, and who understand that property management is a partnership—not an afterthought.
If you’re seriously considering Columbus, I’d be happy to share more about what you should ask a PM before onboarding, even if you go with another company. There are definitely ways to make sure you get the right fit and don’t fall into the usual pitfalls.
Real Estate Consultant · Ann Arbor, MI · Member since 2022 · 463 posts · 253 votes
1y
Hi Poojitha from northern California-
Great question! You are a first time out-of-state investor with 400K in cash and looking to build your portfolio over the next five years.
You asked about good cash flowing markets and whether you should pay cash or use leverage with a mortgage to get the best return.
Understandably, you want to make the best decision and are concerned being a first time out-of-state investor.
Depending on your goals, having a few paid off units with free cashflow can provide as much cashflow as several leveraged properties with more management involved.
Mathematically, you will generally be further ahead using leverage but it is a matter of your goals and risk tolerance.
Whether buying with cash or using leverage, you will need an excellent local team including property management and investor friendly Realtor that acts as your fiduciary.
If you haven't looked at Michigan, there are many markets that cashflow well with a reasonable climate and demand for rentals. We have helped many investors from California and other states invest successfully in Michigan.
Hey, welcome! You're asking all the right questions and you’re in a strong position with $400K ready to go. Here’s my take based on experience and what I’ve seen across different markets:
Cash vs. mortgage: Buying 1–2 properties in cash is conservative and gives peace of mind, but it limits your scale. Many investors use long-term fixed-rate financing to preserve capital and acquire more doors. Even with higher rates, seller-paid rate buydowns and interest-only options can make deals pencil. It’s a personal choice, but don’t overlook the power of leverage when used wisely.
Property management: You’re absolutely right - having a great property manager is essential for out-of-state investing. If a market doesn’t have solid management options, it’s best to move on. It can make or break your experience and returns.
Alternative markets: There are markets that offer a strong balance of cash flow, newer homes, and better tenant quality. Consider: San Antonio, Houston, Dallas TX – Diverse economies, newer inventory, landlord-friendly Ocala, FL – Strong population growth, newer construction Memphis & Birmingham– Solid cash flow and rent-to-price ratios Canton & Akron, OH – Still under the radar, but with strong fundamentals Huntsville, AL – Tech jobs, newer properties, growing demand
You’re not chasing a unicorn - it’s just about dialing in the right market and team for your strategy. Let me know if you want help comparing a couple markets or running deal scenarios side by side - always happy to!
Hello BiggerPockets fam! I live in Northern California and am looking to step into real estate investing by purchasing my first rental property. I have ~ $400k cash available and am willing to buy property with cash down, with a long-term goal of building my portfolio over the next 5 years. Here is what I am contemplating and would like some advice:
1) I want to focus on building a high cash flow. Given the interest rates are high, I am looking at acquiring around 2 properties with cash. Is this prudent, or should I still look into a mortgage and maybe acquire more properties?
2) I have started looking into Indianapolis to start. Higher cash flow areas generally have a C tenant pool, and homes are built in the 1900s. I am worried about high maintenance costs and tenant issues. I am also seeing homes sitting on the market for many days, what does this mean?
3) I looked into Columbus, OH, and read feedback that the property management options are not good. Being out of state, I am concerned about this. Without a good property manager, I cannot sustain an out-of-state investment.
4) I don't know what other markets to consider where there is rental/population growth, has high cash flow, a B-grade tenant pool, and not so old properties. Is this a unicorn?
Looking for advice based on your personal and recent investment experiences, thank you!
Hey Poojitha and welcome to BiggerPockets! You're asking all the right questions and doing the right thing by thinking through this strategically before jumping in.
Starting with #1 — With $400K in cash, you have a great launchpad. Buying in cash will definitely maximize your cash flow and reduce risk, especially in today’s interest rate environment. That said, I wouldn’t rule out using some financing if it means you can scale faster and get into multiple solid assets. A hybrid strategy—buy one property in cash, then finance the second—could give you a feel for both approaches while preserving liquidity.
On #2 — You're spot on about Indy. It does have strong cash flow potential, but the homes can be older and come with deferred maintenance and more hands-on management. The longer days on market could be a sign of softening demand or sellers pricing too aggressively—worth digging into submarkets specifically.
As for #3 — I’ve personally been investing in Columbus since moving here from Portland in 2020 and have built a portfolio of 10+ rentals. I’d say property management is improving, especially with more investors entering the market. There are definitely a few solid PMs here—you just need to vet carefully. Also, Columbus has strong fundamentals: diverse job market, major developments (Intel, Amazon, Google, etc.), population growth, and a good mix of neighborhoods across A–C classes.
For #4 — The unicorn market you're looking for does exist in parts, but it’s about compromise. Columbus, Kansas City, Huntsville, Chattanooga, and some parts of the Midwest/Southeast hit many of your criteria: decent B-class tenant pool, newer housing stock in the right neighborhoods, population growth, and affordable entry points. You might not find the “perfect” market, but with good due diligence, you can find strong cash-flowing markets that align with your goals.
Happy to share more about the Columbus market or connect you with local resources if you decide to take a closer look. You're on the right path!
Property Manager · Clarksville, TN · Member since 2025 · 14 posts · 5 votes
1y
Hey, Poojitha!
Here's some advice on the topics that you've mentioned:
1) If you're looking to build a long-term portfolio of rental properties, it might be best to leverage your cash and acquire more properties. If you're looking for short term cash flow, buying two properties with cash might be the better route. Ultimately, it depends on what your goals are.
2) Tenant issues shouldn't be a concern for you. If you a hire an experienced property manager, they should have experience screening and placing tenants. Having strong screening criteria is a way to protect against tenant issues down the road. If homes are sitting on the market for a long time it could be because they are priced above the market and the owner is not being realistic. That's just one possibility. There could be several reasons for that. \
3) Yes, it's very important to have boots on the ground wherever you are investing. It will speed up the process of everything and they will likely already have relationships with local vendors. It's important to note that taking great care of tenants is an important part of property management. It can build value for you by increasing the chances of a lease resigning (less vacancy).
4) We operate in Clarksville, TN (and surrounding cities including Nashville). We've seen a lot of growth in recent years in terms of population and property value growth. Clarksville benefits from the military base close by (Ft. Campbell). Having a big economic driver like that is great for reducing vacancy. A lot of folks have been priced out of Nashville as well, so they've decided to move out to surrounding cities and suburbs. Those are two economic drivers that have benefited this area of Tennessee.
Investor · Roseville, CA · Member since 2009 · 1k+ posts · 583 votes
1y
@Pooja D. since you have cash you might want to look into buying a property subject to the existing mortgage. I am seeing Propeties being sold this way because they dont have much equity and they have low mortgage rates compared to todays rates.
Bought a rental with very investor friendly realtor (Joe Pryor) if Virtual Real Estate team in OKC https://www.virtualrealestateteam.com/ this year. Single family rental . Not huge cash flow , (300 dollars) but good rates (5.75 or below) from builders, decent affordable prices (270k or lower) for good new properties in A+ neighborhoods when good schools etc . They have really good property management team as well . It was a good experience . Happy to connect. I also live in Bay Area as well and looking to invest out of state.
Realtor · Charlotte, NC · Member since 2023 · 245 posts · 231 votes
1y
1. I'd always recommend leveraging "other people's money" aka the banks' over using all of the capital you've built up. Rates may not be ideal but there are better ways to use your cash. Balance is key and a good lender and agent will help you find that balance.
2. Not familiar with Indiana so I won't comment there. My investment preference is to purchase new construction only. I'm okay with B/C areas but must be a rapidly growing area with shopping and conveniences like Target nearby. This method has made me and my clients a lot of money over the years in both cash flow and equity.
3. Not familiar with Ohio but hear similar stories from our clients that pulled out of the market there. A good management team is one the most important aspects of out of state investing.
4. I'm biased but Charlotte and surrounding areas is exactly what you're describing. "High" cash flow is subjective but there are plenty of markets in this area that can fit the bill if you are flexible on how your cash is used.
Realtor, Contractor, Property Manager · Montgomery AL and Kowaliga, AL · Member since 2017 · 663 posts · 536 votes
1y
Concentrate on B or B- areas. Cash flow and appreciation. Put 50k down on 8, 100k properties. The volume will help you out with Capex. (probably not going to need 8 HVAC units all at once, or roofs, etc.) That should make you $300/mo. x 8 cashflow. $28,000 yearly = pay off 1 every 2 years, then it snowballs. Hopefully have them all paid off in 7-8 years, then you are making 100k a year passive income.
You’re asking all the right questions! And it’s clear you’re approaching this thoughtfully, which is half the battle. With $400K in cash, you’ve got a ton of flexibility. Buying 1–2 properties outright is definitely the most conservative route and will give you peace of mind with zero leverage, but it could limit your portfolio’s long-term scalability. Even with today’s higher interest rates, many investors still opt to use financing strategically to stretch their capital, especially when you can lock in solid cash flow with the right market and management in place.
Regarding markets, you nailed some key pain points. Indianapolis and Columbus do offer cash flow, but yes, older homes, Class C neighborhoods, and weaker PMs can eat into returns fast if not carefully managed. If you’re looking for newer inventory, B-class tenant pools, steady rental demand, and a market built for out-of-state investors, I’d definitely recommend looking into Memphis, TN. It checks a lot of the boxes you’re looking for: landlord-friendly laws, strong local job growth (FedEx, medical, logistics), affordable homes ($100k to $150k) often built post-1970s, and a well-established network of investor-friendly agents and property managers who regularly work with out-of-state buyers. There’s a reason why so many first-timers, and experienced investors choose Memphis as their launchpad.
Also, homes sitting longer on the market isn’t necessarily a red flag, it could just be overpriced or poorly marketed, especially in the Midwest where homes don’t fly off the shelf like in California. But it’s a good reason to make sure you’re working with a local agent who knows what’s normal in that market.
Happy to share more if Memphis ends up on your shortlist. You’re definitely not chasing a unicorn! Just need to plug into the right ecosystem. You’ve got the resources to build something great.
Real Estate Agent · Columbus, OH · Member since 2025 · 184 posts · 179 votes
1y
Hey! You're asking great questions—here’s my quick take:
Cash vs. Mortgage – If you're looking to scale, I’d recommend using some financing. Even with today’s rates, you can still find deals that cash flow and pick up 4–6 properties instead of just 2.
Indy – You're right: older homes and C-class tenants can mean more maintenance and turnover. Homes sitting longer might just mean investors are being cautious or sellers are overpriced. Worth digging in case-by-case.
Columbus – I invest here and totally get the PM concern. Some aren’t great, but there are solid ones. If Columbus is on your radar, I’m happy to connect you.
Other Markets – Dayton, OH, might be worth a look. More B-class areas, better cash flow, and not as old as Indy.
Let me know if you want to hop on a quick call—I’d be happy to share what’s working for us out here.
My business partner established a very similar business, starting with a cash portfolio, and we've slowly transitioned to buying more commercial properties ourselves over time.
I'm an investor and an investor-only agent here in Indianapolis and surrounding markets, so I'd be happy to hop on a call and share what I know.
1. You could also consider using a lower leverage point instead of an all-or-nothing approach. For example, what if you put 40-50% down and bought 800k worth of properties? You can also get more favorable DSCR rates if you have a lower LTV.
2. Homes sitting on the market longer are showing that the demand for that specific asset class just isn't as high OR they are priced too high for what they have.
3. For Indianapolis, I usually refer people over to Hoosier Homes Management or AJD Property Management, and both are excellent. Successful management and proper maintenance are definitely a make-or-break for a lot of real estate investors' businesses, and the best way to find a good one is by asking other investors who they use and interviewing a few of them to find out who you feel like you will work best with.
4. I could point you to a few places that we buy Cs and make them Bs and rent them out to great residents :).
Hello BiggerPockets fam! I live in Northern California and am looking to step into real estate investing by purchasing my first rental property. I have ~ $400k cash available and am willing to buy property with cash down, with a long-term goal of building my portfolio over the next 5 years. Here is what I am contemplating and would like some advice:
1) I want to focus on building a high cash flow. Given the interest rates are high, I am looking at acquiring around 2 properties with cash. Is this prudent, or should I still look into a mortgage and maybe acquire more properties?
2) I have started looking into Indianapolis to start. Higher cash flow areas generally have a C tenant pool, and homes are built in the 1900s. I am worried about high maintenance costs and tenant issues. I am also seeing homes sitting on the market for many days, what does this mean?
3) I looked into Columbus, OH, and read feedback that the property management options are not good. Being out of state, I am concerned about this. Without a good property manager, I cannot sustain an out-of-state investment.
4) I don't know what other markets to consider where there is rental/population growth, has high cash flow, a B-grade tenant pool, and not so old properties. Is this a unicorn?
Looking for advice based on your personal and recent investment experiences, thank you!
Hey Poojitha, congrat's on your success so far. I'm also in NorCal, Sacramento to be specific. You'll find some cash flow, rent and price appreciation over time here. The Sacramento market is growing, 2M+ in the region, growing jobs, and the #1 destination people are moving to from the SF Bay Area. Plus CA real estate is has always been a good bet. If you'd ever like to discuss investing in Sac, I'm happy to jump on a call or meet up. Best of luck:-)
Hello BiggerPockets fam! I live in Northern California and am looking to step into real estate investing by purchasing my first rental property. I have ~ $400k cash available and am willing to buy property with cash down, with a long-term goal of building my portfolio over the next 5 years. Here is what I am contemplating and would like some advice:
1) I want to focus on building a high cash flow. Given the interest rates are high, I am looking at acquiring around 2 properties with cash. Is this prudent, or should I still look into a mortgage and maybe acquire more properties?
2) I have started looking into Indianapolis to start. Higher cash flow areas generally have a C tenant pool, and homes are built in the 1900s. I am worried about high maintenance costs and tenant issues. I am also seeing homes sitting on the market for many days, what does this mean?
3) I looked into Columbus, OH, and read feedback that the property management options are not good. Being out of state, I am concerned about this. Without a good property manager, I cannot sustain an out-of-state investment.
4) I don't know what other markets to consider where there is rental/population growth, has high cash flow, a B-grade tenant pool, and not so old properties. Is this a unicorn?
Looking for advice based on your personal and recent investment experiences, thank you!
Another potential strategy if you are accredited and want to avoid investing in "old properties" is to consider becoming a passive investor in new single-family built-to-rent projects. There are a few in the Midwest and southeast. We are evaluating one near Kansas City.
You have gotten some great advice already! I do think finding 60s+ or 80s+ construction in B areas is very possible - there are several areas of Kansas City where this can be done. If you leverage at 75 LTV with ~7% interest rate you will significantly reduce your cash flow now but youll be able buy more real estate. Right now is a fairly good time to buy so I would encourage you to think long term and buy solid properties now with a focus on getting those to cash flow well over the next 3-5 years. Checkout my BP episode 373, I started in the Midwest from CA as well!
