Denver, CO · Member since 2016 · 5 posts · 0 votes
I am moving to St. Louis and looking to purchase a condo, apt or multi-family below 240k. I would like to live in for the first year then hold it as an investment. I do not know the area real well.
I am in my 20s. Top priorities are good investment with future cash flow and opportunity to increase in value, somewhat young professional area with stuff to do and SAFE.
Real Estate Agent · Venice, CA · Member since 2015 · 182 posts · 125 votes
10y
@Mitch Anderson - I'm currently working with @Peter MacKercher and highly recommend him. Give him a call and he will help you out.
I invest in South City and there is a variety of good and bad neighborhoods. It can be block to block. What seems like a great deal, might be a bad deal if you buy in the wrong area.
Investor · O Fallon, MO · Member since 2016 · 71 posts · 18 votes
10y
Hey Mitch - welcome to St. Louis (early). I think you're in the right frame of mind for your big move. St Louis is an extremely affordable market and there are numerous opportunists for investment. As for your thoughts on a condo, I would actually advise you to look towards a single family property or a 2-4 plex. Condos are in far lower demand in our market.
Areas you might consider: South St Louis City, Tower Grove, Maplewood, Cherokee, University City, and Lafayette Square.
If you'd like some more info from a "boots on the ground" investment agent PM me. We can always talk about more options and areas in detail.
Investor · Granite City, IL · Member since 2014 · 658 posts · 301 votes
10y
Do not go Condo in St. Louis. Very difficult to cash flow and appreciation is out of the question except in the highest-end areas. In fact, most areas of St Louis won't appreciate very quickly. It's a steady-eddie area. @Alex Tillman has some good suggestions. If you're considering the Illinois side of the river, O'Fallon, Glen Carbon, Troy, Edwardsville, and near Scott AF Base are good areas.
Denver, CO · Member since 2016 · 5 posts · 0 votes
10y
Thanks for the input Alex and Ron. I am definitely open to the Illinois side and it looks like there are some good options over there. I understand what you guys are saying about steering clear of condos and looking into single family or 2-4 plex. My reasoning for considering a condo is the lower maintenance it may entail if I move out of the city. I am not entirely sure I will remain in STL permanently (although I plan on holding on the investment regardless). It doesn't look like there are many town home options, any thoughts on options or areas that would require less maintenance but still be sound investments/living opportunities?
Tough to answer your question. But the St Louis area does have a couple of good PMs from what I understand (and some really lousy ones). You will have better luck with getting PMs over in Missouri than Illinois, but we have a few over here.
Property Manager · Saint Louis, MO · Member since 2015 · 186 posts · 76 votes
10y
If you're thinking investment, condo fees are going to be a bigger dent in your ROI than most PM fees. As a buy and hold investor in South City with a house hack, I find the St Louis market extremely appealing for this method of investing. I'm also an investor-friendly agent and I must say my buy and hold clients, especially the out of state ones, really like all of the options you have in small multifamily in the City. There are so many unique neighborhoods, so you can really think about the type of renter you want to attract, your investment strategy (do you want to renovate a bit and build equity or a ready to go turnkey, invest in an up and coming neighborhood with appreciation potential or a neighborhood that's been solid for decades), and the lifestyle you want to live - it's a house hack after all. Feel free to PM if you want to talk South City.
Rental Property Investor · Saint Louis, MO · Member since 2016 · 162 posts · 53 votes
10y
Just in the last 2-3 days, I've been hearing about a PM company - RentersWarehouse.com (I hope I can post this info). I beleive they claim $99 per month per door. That seems pretty reasonable to me, if you need a PM.
Like others have said, stay away from condos and town homes. Fees eat into your money.
Denver, CO · Member since 2016 · 5 posts · 0 votes
10y
Thanks guys. What do you recommend the best areas would be close to the city (or in it) for investment, safety, and close to going out i.e. bars, sporting events, concerts?
Residential Real Estate Broker · Saint Louis, MO · Member since 2014 · 1k+ posts · 567 votes
10y
@Mitch Anderson A lot of where you'll be able to buy depends on what class of property you're after. At $240k I personally wouldn't recommend a SFH for a buy and hold since you'll be risking a lot of potentially expensive damage if you happen to have the wrong tenant (you can get a nice house for that price here).
A duplex would be a good fit for something that'd be comfortable as a primary residence if you're open to house-hacking, and you'd of course get the benefit of FHA financing (which I recommend).
At the 4-family level the $240k would start to thin out based on the area you've described you're looking for, since the more professional areas here are also very expensive, and some of them, Clayton, for example, has very few 4-family buildings compared to areas closer to the Arch.
Like it's been mentioned, I wouldn't recommend banking on appreciation as part of your purchase -- that's always the icing on the cake. It happens all over the city, but counting on it to cover upfront costs is a great way to not be able to pay your expenses. St. Louis is a cash flow city, for the time being, so make that your consideration when evaluating property here.
I'd be happy to give you advice if you'd like to talk, so don't hesitate to reach out. You have a lot of options and figuring out your best move just needs some goal-oriented discussion.
Investor · Granite City, IL · Member since 2014 · 658 posts · 301 votes
10y
@Jeremy Paschedag I've been hearing a lot on the air from them too. Actually thought about buying a franchise opportunity at one point. But their fee structure was a little too wonky for me. $99/month for this area is pretty hefty, especially with a lot of places renting in the $700-$900 range. Plus you have an initial start up fee of $99. Plus the placement fee of one month's rent. So my PM cost for a SFH that rents for $800/mo will be almost 20%. And even if the existing residents stay, the PM fee for year two is 16.3%.
If I have 20 SFH @ $800/mo, I'll pay them somewhere in the area of $30,000/yr in PM fees. I could hire an office assistant or pay for a full-time employee for that amount. I'm not bashing them. Like I said, it's probably great in areas where the rent can support it. But there are a lot of areas where that amount just won't be financially viable.
Real Estate Agent · Venice, CA · Member since 2015 · 182 posts · 125 votes
10y
@Mitch Anderson - I'm currently working with @Peter MacKercher and highly recommend him. Give him a call and he will help you out.
I invest in South City and there is a variety of good and bad neighborhoods. It can be block to block. What seems like a great deal, might be a bad deal if you buy in the wrong area.
Investor · Ballwin, MO · Member since 2015 · 111 posts · 83 votes
10y
Hey Mitch,
I'll throw my hat in the ring also. Like@Maggie L.@Alex Tillman, @Ronald Perich, and @Peter MacKercher mentioned above. I would stay away from condos. no one has mentioned the HOA fees, but they can be brutal. Yes, you get the lawns mowed and access to pools, but you also always seem to get people on the HOA board who get a little power and go nuts. You have to be very cognizant of "special assessments" which can add literally thousands of dollars a year to your costs. As mentioned above, St Louis is a great cash flow city and really pretty unique from many places in the rest of the country because of the number of 2 and 4 family homes that you can pick up for great prices (and which still return great rents).
I'm biased because all I buy are small multi-family (and you are getting some great advice from local people here). For my money in the price range you are talking about, you can pick up a great 2 family and live a pretty luxurious lifestyle (or pick up 2 for that price and have some great cash flow...)
Rental Property Investor · Saint Louis, MO · Member since 2016 · 162 posts · 53 votes
10y
@Ronald Perich I hadn't looked into them. The pricing is interesting. I didn't realize you had to pay setup nor first month. Not such a good deal after all. Gives me more motivation to self-manage.
Rental Property Investor · Saint Louis, MO · Member since 2016 · 162 posts · 53 votes
10y
@Jeff Reese
Again, I'd stay away from Condos completely. If you were wanting to get into vacation property, which I know nothing about, I'd suspect you would want something that offers a spectacular view and close proximity to city activity (Fox theater, Washington St, Soulard, Arch, Busch Stadium/Ballpark Village, Savvis Center, etc.).