Hi there,
I am new to
rental property investing. I came to a realization that it doesn't make financial sense to buy a home in the city I am in due to high prices here. I am considering investing in rental
properties in cities with positive cash flows instead. I came up with
the following list of potential cities to invest in - Atlanta, Houston, Austin,
Dallas, Raleigh, Indianapolis, Kansas City, Orlando. Could you folks
provide insights on whether the cities I am considering are feasible candidates
for positive cash flow + potential appreciation? I'd appreciate any guidance on things I should keep in mind as I get started on this path. Thank you very much for your time.
Hi there,
I am new to
rental property investing. I came to a realization that it doesn't make financial sense to buy a home in the city I am in due to high prices here. I am considering investing in rental
properties in cities with positive cash flows instead. I came up with
the following list of potential cities to invest in - Atlanta, Houston, Austin,
Dallas, Raleigh, Indianapolis, Kansas City, Orlando. Could you folks
provide insights on whether the cities I am considering are feasible candidates
for positive cash flow + potential appreciation? I'd appreciate any guidance on things I should keep in mind as I get started on this path. Thank you very much for your time.
Welcome aboard. As KC was on the short list in this thread I figured I'd drop you a link to The Ultimate Guide to Grading Kansas City Missouri Neighborhoods. Also have similar guides for Cleveland, Ohio and Birmingham, Alabama.
In addition there are tons of other turnkey markets out there besides Cleveland. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. In no particular order I have listed some of the most popular markets for out of state investors
Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.
One thing to note when looking at the individual markets, you can make or lose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.
@Niraj R. My 2 cents - pick any of those and go 30 minutes out (or investigate counties that touch your target county). There many a bedroom a community that have plenty of opportunities to offer.
@Niraj R. Austin is one of top cities to invest in but it is more for appreciation than cash flow. If you go further out of Austin you would get more cash flow but it may take a little longer to find a tenant. In Austin you can rent a home very quickly as the occupancy rate is 95%
I’m also in a high priced area. I still look for deals here although they maybe few and far between. In either case I decided to go to an area about an hr out that’s “up and coming”, a big company decided to expand their business and provide 400 new jobs and police have clean up and reduced the crime rates. No Starbucks or hipster coffee place yet, but I suspect it won’t be long. Getting in now and even if nothing happens, I’m still buying into a deal and still getting cashflow out. In my mind the location I decide to go into doesn’t matter in the sense that there’s real estate everywhere, what is important is that you can find enough leads to get you to enough quantity of quality deals.
Hey @Niraj R., welcome to the BP forums. Atlanta is an excellent area to invest in for both cash flow and appreciation. Of course, where you buy will be determined mostly by your goals and investment philosophy. Shoot me a DM if you'd like to discuss further. Best of luck to you - Marc.
Hi there,
I am new to
rental property investing. I came to a realization that it doesn't make financial sense to buy a home in the city I am in due to high prices here. I am considering investing in rental
properties in cities with positive cash flows instead. I came up with
the following list of potential cities to invest in - Atlanta, Houston, Austin,
Dallas, Raleigh, Indianapolis, Kansas City, Orlando. Could you folks
provide insights on whether the cities I am considering are feasible candidates
for positive cash flow + potential appreciation? I'd appreciate any guidance on things I should keep in mind as I get started on this path. Thank you very much for your time.
Welcome aboard. As KC was on the short list in this thread I figured I'd drop you a link to The Ultimate Guide to Grading Kansas City Missouri Neighborhoods. Also have similar guides for Cleveland, Ohio and Birmingham, Alabama.
In addition there are tons of other turnkey markets out there besides Cleveland. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. In no particular order I have listed some of the most popular markets for out of state investors
Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.
One thing to note when looking at the individual markets, you can make or lose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.
I live near the Raleigh area and confirm that it’s a hot area. With its increasing popularity its becoming more and more difficult to find properties that will cash flow. Appreciation is certainly there, but cash flow is a little different. I’m considering looking out of state as well.
I'm no expert but I am looking for property in Dallas and it is very competitive. It's a hot market and appreciation seems to be the name of the game. I have heard that it is easier to cash flow in some of the surrounding suburbs, but I don't have any experience with it myself.
Certain area in Atlanta are good to hold rental properties. For long distance investor I always like to suggest almost turn key properties. You can find property in good area around 200K that can rent for 1550. Still cash flow and appreciate. but not 1%. some other areas can see more or less but this is what I see so far. I'd like to help you
@Niraj R.Of all the markets that you mentioned, I think that Indianapolis and Kansas City are the best for cash flow. The problem with Houston, Dallas and Austin is that TX has some of the highest property taxes and insurance rates in the nation which significantly depresses cash flow. Personally, I would put Indy and KC on the top of your list. We've been involved in both markets for several years. Feel free to reach out if you want some more insight.
@Niraj R.
KC is a killer city. I found BRRR to be easy to do here ;)
The Austin metro area is better for investments here. Look at all the surrounding cities here. Make sure you have a solid prequal because deals go fast here and you need to be ready to move on them.
You can get cash flow & appreciation here as well which is a plus.