Deciding Where to Invest

5 Replies

Hey everyone! For a long time my husband and I have been talking about investing in real estate, and we're finally financially (and mentally) ready to do so. I've read the books, listened to the podcasts, and feel pretty educated when it comes to real estate. I actually used to have my license and we've bought and sold 4 of our own properties, so we're not new to real estate, just to investing. We live in the Boston area, where real estate prices are through the roof. Because of high prices, investing in our immediate area isn't realistic, so we've been exploring other options (mostly New Hampshire and Maine), but I'm so worried about choosing the wrong area. I'm doing the analysis of invidual properties, and on paper I've found a few that look promising, but without living in the area I'm afraid of choosing the wrong location. For those of you who have invested outside of the area you live in, how did you make sure you were choosing a profitable location? At this point, shoud we just start visitng areas and reaching out to agents with our criteria? 

it's always good to keep back-end re-sale in mind when buying stuff, so that should factor into your due diligence when considering areas. Find out how the rental market is trending - are rents increasing? What's the vacancy rate for apartments? Is the rental market tightening or loosening? Look into where the better school systems are, companies moving in/employment growing etc. Pay attention to days on market for home sales in each town - how long is the average? How is it changing? Town taxes are another factor in New Hampshire...... they vary wildly from town-to-town. Bridgewater up near me is one of the lowest in the state at $9.43 per thousand, vs Plymouth which is just next door ar $29.56! Lots to think about Courtney.......   :)

@Courtney Aseltine

First Define how you will finance the deal (Also get pre approved to assist you in which areas to look into) 

Second, you are looking at target areas.... What factors are important to you? I would look into: market rents, crime, school systems, and you will have an idea of your target renters. Use sites such as neighborhood scout.com and city-data.com to learn the areas 

With this criteria set, you can begin to analyze deals (using the BP calc, or another one) 

Do you plan on self managing? If so read up on the Mass LL tenant laws 

@Courtney Aseltine

I'm in a similar situation as you because I live in SF and the prices here are insane. I currently invest OOS (In Cleveland).

I think the first step you want to do is to find a market. I recently read the book "Emerging Real Estate Markets: How to Find and Profit from Up-and-Coming Areas" which was recommended by a podcast, forgot which one, that could be a good start. The things I look for are job growth, population growth, etc. I also follow a lot of the big contributors here on BP, and a lot of times they post on why they are investing in certain markets, etc.

Then you need to decide how you want to get your deals done. The easiest way would be through a turn key company, but you have to be very careful in vetting the companies as a lot of them do sell above market price and pro formas are usually exaggerated and leaves out a lot of different expenses. How I'm doing it is through a partner that's my boots on the ground, mostly just networking from BP, and at local real estate events. The other way to do it is to build your own team, so agent, PM etc. 

Hopefully this helps! PM me if you have any more questions.

Originally posted by @Courtney Aseltine :

Hey everyone! For a long time my husband and I have been talking about investing in real estate, and we're finally financially (and mentally) ready to do so. I've read the books, listened to the podcasts, and feel pretty educated when it comes to real estate. I actually used to have my license and we've bought and sold 4 of our own properties, so we're not new to real estate, just to investing. We live in the Boston area, where real estate prices are through the roof. Because of high prices, investing in our immediate area isn't realistic, so we've been exploring other options (mostly New Hampshire and Maine), but I'm so worried about choosing the wrong area. I'm doing the analysis of invidual properties, and on paper I've found a few that look promising, but without living in the area I'm afraid of choosing the wrong location. For those of you who have invested outside of the area you live in, how did you make sure you were choosing a profitable location? At this point, shoud we just start visitng areas and reaching out to agents with our criteria? 

Hello and welcome! Investing out of state can be great when you live in a market where you cannot get a good return. Research to see what market can get you the best ROI! Make sure, if you work with professionals, you chose a good team!

Try looking at:

The Best Types of Markets for Profitable Turnkey Properties

Tom Ott, Real Estate Agent in OH (#2016003865)
440-749-4043

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