Investing OOS, first time investor.
With so much information out there, I'm a bit overwhelmed with choosing a market to invest in. I want to invest for cash flow, preferably MF. Seems like OH is very popular right now, but I would assume that means I'm a bit late to the party. If anyone has any recommendations on emerging markets that I can research, that would be very helpful. I just want to choose a place quickly, not necessarily to purchase something immediately, but just so I can begin networking in that area. Thanks!
Look into OKC and JAX
Originally posted by @Eric Levy:
With so much information out there, I'm a bit overwhelmed with choosing a market to invest in. I want to invest for cash flow, preferably MF. Seems like OH is very popular right now, but I would assume that means I'm a bit late to the party. If anyone has any recommendations on emerging markets that I can research, that would be very helpful. I just want to choose a place quickly, not necessarily to purchase something immediately, but just so I can begin networking in that area. Thanks!
It depends on where in OH you are looking. Cleveland is HOT, but also has plenty of inventory. If you are looking for cash flow, this is the market to check out. Properties are affordable and rents are going up. Almost always hit a 1.2% ratio.
Just make sure you know where you are looking!
@Derek Janssen I will! Thanks for the suggestion.
@Tom Ott I will definitely take a look. Just doing a quick search on Zillow or Redfin, it doesn't seem like there are many MF properties that aren't extremely old, and I don't particularly want an old property for my first buy. I will probably need to scout MLS listings. Thanks for the recommendation.
Originally posted by @Eric Levy:
@Derek Janssen I will! Thanks for the suggestion.
@Tom Ott I will definitely take a look. Just doing a quick search on Zillow or Redfin, it doesn't seem like there are many MF properties that aren't extremely old, and I don't particularly want an old property for my first buy. I will probably need to scout MLS listings. Thanks for the recommendation.
How many units are you looking for? Sometimes you can get a better ROI with a SFR in the suburbs in a city like Cleveland where the MFRs are often found in older rougher areas.
@Tom Ott Preferably 4, but I'm open to duplex and triplex as well. I haven't done much research on SF investing, but I am open to it. They just generally do not cash flow as well from what I understand, and I feel it's more risky to bet on appreciation in the current part of the market cycle (although I guess for long term, that doesn't really matter).
We are in the same boat. Looking OOS is on our list for the next year but all the info and advice from pretty much anyone you talk to makes it very confusing. We have slowly build a light set of qualification factors for an OOS market. Then, it's a matter of finding a market that would be reasonable to invest in, running the standards, and building you team. I've heard a few different people here on BP say to look toward markets that you have someone on the ground that you already know. Like, Grandma lives in Ohio so start there, etc, etc. - Best of luck on your journey.
Originally posted by @Garrett Diegel:
We are in the same boat. Looking OOS is on our list for the next year but all the info and advice from pretty much anyone you talk to makes it very confusing. We have slowly build a light set of qualification factors for an OOS market. Then, it's a matter of finding a market that would be reasonable to invest in, running the standards, and building you team. I've heard a few different people here on BP say to look toward markets that you have someone on the ground that you already know. Like, Grandma lives in Ohio so start there, etc, etc. - Best of luck on your journey.
Yes, I've heard the same. Unfortunately I don't know anyone in a location with the type of market I want to invest in. I'm thinking I will just choose three places I've heard are good and decide between them. But anyways, thanks and good luck to you as well!
I am new to BP. I am reading your posts. I have questions on the terms you are using. What is OOS investing and SF Investing and what is SFR in suburbs?
Hey Dawn, welcome to BP! OOS means out of state, SF means single family, and SFR means single family residential. Let me know if you have any other questions and I'll help you as best as I can.
Originally posted by @Eric Levy:
With so much information out there, I'm a bit overwhelmed with choosing a market to invest in. I want to invest for cash flow, preferably MF. Seems like OH is very popular right now, but I would assume that means I'm a bit late to the party. If anyone has any recommendations on emerging markets that I can research, that would be very helpful. I just want to choose a place quickly, not necessarily to purchase something immediately, but just so I can begin networking in that area. Thanks!
If you are going MF first time and OOS sametime, IMO you would need to piggyback to make this work without adding all the extra risks. Many OOS buyers end up on the wrong side of the tracks and won't realize it before it is too late. I am sure OH is loaded with them. Your networking idea is great, just add to team one experienced OOS MF investor and not someone who only posts on here to market you something to just make a commission off.
Good luck with your search!
Thank you Eric...I just sold an apartment bldg in Chicago and looking to invest somewhere else.
@Matt R. Thanks for the advice Matt!
@Dawn Gawron That's awesome Dawn. I hear the midwest is great for cash flow. Best of luck in your search!
@Eric Levy just came across this! Haha ended up snagging a duplex in OKC! Did you expand to any other markets or keeping it focused here?
Originally posted by @Kiera Underwood:@Eric Levy just came across this! Haha ended up snagging a duplex in OKC! Did you expand to any other markets or keeping it focused here?
@Kiera Underwood Haha, i think this was my first post! I'm trying to stay in OKC for now but i haven't come across many good MF deals on the MLS recently. I'm debating doing a direct mail campaign, but haven't decided if I want to put that much effort yet.
Originally posted by @Garrett Diegel:
We are in the same boat. Looking OOS is on our list for the next year but all the info and advice from pretty much anyone you talk to makes it very confusing. We have slowly build a light set of qualification factors for an OOS market. Then, it's a matter of finding a market that would be reasonable to invest in, running the standards, and building you team. I've heard a few different people here on BP say to look toward markets that you have someone on the ground that you already know. Like, Grandma lives in Ohio so start there, etc, etc. - Best of luck on your journey.
What qualifications do you have for your OOS market?
@Eric Levy I hear you! MF is tough here right now. Direct mail isn't servicing my list much at all right now. Just a few a year, so I'm not sure if it'd be worth the effort for you. I can't remember if when we talked last if I connected you to off-market properties. I'll look back in our messages!
Originally posted by @Alyssa Dyer:
Originally posted by @Garrett Diegel:We are in the same boat. Looking OOS is on our list for the next year but all the info and advice from pretty much anyone you talk to makes it very confusing. We have slowly build a light set of qualification factors for an OOS market. Then, it's a matter of finding a market that would be reasonable to invest in, running the standards, and building you team. I've heard a few different people here on BP say to look toward markets that you have someone on the ground that you already know. Like, Grandma lives in Ohio so start there, etc, etc. - Best of luck on your journey.
What qualifications do you have for your OOS market?
We have a short list of the standards. Pop and job growth type numbers as always. Do we know anyone on the ground or with ties to someone there? Is there any other reason to invest there for us personally? Is it landlord friendly?
We also like to work near and around military bases.
Outside of the pop, job, and other hard factors it really comes down to your personal strategy. The US is huge and full of opportunities. So many that it actually gets overwhelming.
@Garrett Diegel I wonder if OKC would meet your mark? From 2010 to 2016, Oklahoma City’s pop grew by ~10% and has experienced a 1.55% average annual growth rate. In 2016 the MSA pop was estimated to be 1,379,525 while the city of Oklahoma City’s population was 649,058.
Really big picture what is boils down to is that the Oklahoma City MSA is the 10th-fastest-growing large metro in the country and has grown twice as fast as the nation.
We're very landlord friendly with evictions being complete in under 30 days and costing around $500. We're also home a major air force base! As far as strategy, the reason you invest in OKC is stability, cash flow and price point. In the last recession, OKC was deemed recession-proof by Forbes and saw only 6% drops in property values when other markets saw 20%. A C class property is 60-80k with 8% rates of return.
Might be something worth looking into! I'm happy to answer any questions.