doing my research

8 Replies

I have been trying to do my research about markets and what type of investor I want to be.  I have decided I am a buy and hold, out of state, investor who wants cash flow on a property with little involvement.  I am looking for a market with business and population growth in A-B neighborhoods that are newly made or newly renovated.  I want at least 200 a month cash flow in the price range of 50,000-125,000.  do you think I am being realistic in today's market and would there be a turnkey company that would fit this? if I have to change my parameters what should I look to change first?

@Jasmine C.

You are mostly realistic.  While many of us have different opinions, mine is that you will not find a B quality investment for under say $75-80k.  Those to me are more like C or lower. Just bc a home provides great cash flow doesnt have anything to do with area quality. 

You should be focusing a little more on who the management company will be. Make sure they are a licensed management company as there are too many out there who are not. Management is going to be the key to your success.  You can buy a great home at full market value and if its managed correctly you can do great.  Most homes from a TK company are newly renovated.  

You will find that every property provider who will respond to this will say their market is great.  There are many that are great, do your homework and narrow it down to a handful or markets you like then start to research the providers in those markets.  

Also make sure you are dealing directly with the TK provider.  Its good to get advice from others here but beware of ones who seem to know all the markets and want to put you in touch with them, do your own home work.

Good luck

@Curt Davis seems like a quality turnkey rental provider in Memphis.  @Engelo Rumero (sp?) offers same in Toledo and from an investor perspective, try and ask @Ali Boone.  She has some in the Atlanta area and pretty much exclusively does what you are asking about. Because I can ping these folks, you may have to PM them. Good luck @Jasmine C. !

Jasmine , You are doing exactly the right thing.  Doing your research before jumping in! This is what I've been doing for 10 years.  I started in my own back yard, then that became too expensive, I moved out of state.  Currently we are investing in Kokomo, Indiana. This fits the bill for your price range and type of renter. We have a great property Manager out there who we deal with as well.   There are several articles on the landlord market in Kokomo on my web site ([REMOVED]) which show how business insider named Kokomo the #4 market in the states for landlords, based on price, rent price, employment, etc.   The largest Chrysler plant in the country is based in Kokomo. There are several other large employers in the area as well.  you can get a nice 4 bedroom house for $110,000, and a nice 3 bedroom for $75.  You can get cheaper properties for as low as $30000, all fixed up. These lower ones would be c rated properties, in my opinion.  Anyway, good job doing the research. you will find an area that suits you. Thanks, Christine

@Jasmine C.

I think your numbers are a realistic expectation more at the higher end if you want a B property neighborhood.  Everybody has a different take on what constitutes A, B, C etc, but from my perspective an A neighborhood is not realistic within your price range, and probably would provide the cash flow you, even if it was, so stick to B. Good markets to consider would be Indianapolis, Kansas City, Jacksonville (Fl), Birmingham, & Philadelphia. 

@Jasmine C. $50-$125K is a real big price range. You're not going to get newer properties in A or B class neighborhoods in any market You can get B class properties for $80K-$90K in Indianapolis and Kansas City but even in those markets, you'll have to go to $125 to get in an A class area. I have to question the new construction criteria. A lot of times people set that as a criteria without knowing why. If it's maintenance that you're concerned with, you can actually have more in deferred expenses with a house built in 1960 than one in 1990. The house built in 1960 may have been recently renovated and has all new mechanicals, (furnace, AC, roof etc)  whereas the house built in 1990 has most liely never had any of those replaced and they are now getting to the end of their useful life. It's not the age of the house, but what has been done to it that matters. I had a home inspector on my radio show recently that talked about that. You can find a podcast of it on my website. Your cash flow goals are very realistic in either a B or C class property.

Originally posted by @Steve Vaughan :

@Curt Davis seems like a quality turnkey rental provider in Memphis.  @Engelo Rumero (sp?) offers same in Toledo and from an investor perspective, try and ask @Ali Boone.  She has some in the Atlanta area and pretty much exclusively does what you are asking about. Because I can ping these folks, you may have to PM them. Good luck @Jasmine C. !

Hey Steve,

Thanks for the mention.

We are still green but growing and doing our best to match it with the likes of Curt an Chris from Memphis.

Thanks and have a great day.

You can do those numbers in TN and GA and possibly other states as well.

I suggest you make a goal of finding a possible property and plug all those numbers into the rental property tool under the analyze tab.

Find the property, contact the agent, double check the taxes, contact a property management company, double check how much the insurance will run you, contact an attorney, double check closing close, loan fees, property expenses, and so on.

It all depends on your area and what you are looking for. We bought in 2011 in an heavy hit area and bought great townhouses for 90k now they are much higher! They were class A and you can't get that any more! So the key for that type of investment is find a depressed area or changing area. 

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