Best real estate market right now (In the USA)

18 Replies

Hello, Im new here but was wondering if you guys had to pick the best real-estate market for investors right now which city would you pick? I have about 3.5 mill to invest and absolutely will not take less than a 10 percent cap rate

Originally posted by @Steve Tan:

Hello, Im new here but was wondering if you guys had to pick the best real-estate market for investors right now which city would you pick? I have about 3.5 mill to invest and absolutely will not take less than a 10 percent cap rate

 Are you sure you want to put all your money in higher cap risky properties?

@Account Closed  

most people with that kind of capital go the other way... the more you have the lower the cap rate because its about equity protection as opposed to making as much as you can and then taking on the risk of losing capital which your doing when you go north of 10% caps. in the SFR game.

If you want that kind of return the safest and best place is to hook up with a REALLY good HML and make your 10 to 12% with a very good amount of security and equity protection and passive to boot.

@Account Closed  

  plus your going to get bombarded with invest in my area because we are the best  PM's and such...

Better to withhold your capital capacity on these types of forums I think.

Wow Ive gotten bombarded by sales reps, haha...Anyway theres hardly any risk as long as Im making sufficient cash flow. The lower the cap rate the more risk involved...I own 20 sf's and get about an 18 percent cap rate why any one would accept less that 10 is beyond me

How about an answer to the question lol

@Account Closed  

  why are you asking it here... your obviously successful why not just recreate what you already have...

at those cap rates your buying lower end type properties and you can find them in any major mid west or north east market take your pick. at that point its about teams in place to protect your interest.. But to answer you question

I like Chicago as you can get some mass there and a ton to choose from and you can buy value add which your going to need to ultimately get to your super high return that you must have.

Frankly those with this kind of cash I just don't see going to in to these types of assets as they are management intense and the loss of capital is real.

The bigger cash guys I see go for A quality assets and with that kind of cash you could buy a very nice 10 million plus properties that would give you years of income enjoyment while your sipping your fruity drinks in the tropics   :)

Originally posted by @Account Closed :

The lower the cap rate the more risk involved...

 Not true.  And the financial vocabulary from these posts doesn't seem to match the financial claim of having 3.5M to invest.

Nonetheless, short answer is D class rentals will give you 10% cap rate more.  Enjoy.

If I may be so bold,  as I am relatively new here, may I suggest that you listen to BP podcast #98. Allan Glass talks about how you really can't look an entire city as whole as to whether or not it would be a great market, or best market. It really will depend on the areas/neighborhoods within the city. 

Also Jay great advice with respect to the capital.

@Account Closed  

Dayton, Ohio of course, lol I am just answering your question and if you would like to chat I would love to!  I'm just a local investor here in Ohio too!!

Thanks

Sondra

Thanks for the link to the podcast, I will definitely look into it. For the record I am located in the pittsburgh area, and have found many "Non-Ghetto" properties that generate me a decent return. Also I am willing to be a little risker because I am mainly looking for cash-flow in this stage of my life.

Im personally thinking Charlotte NC or Gulf of Florida area. 

@Account Closed  

 Dominate your local market  grass is not always greener if your getting 18% net returns why go anywhere else.. to get those returns in others markets will put you squarly in the HOOD

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@Account Closed This whole conversation seems a little off to me. You have 18 SFR in Pittsburgh generating 18% cap. Why not just keep growing in the market you already know and are having success with?

You also have a boatload of capital at your disposal. You could easily purchase a few nice apartment complexes with on-site management and call it a day. Seems strange to be playing around in the SFR game when you can do much better elsewhere. I would consider buying distressed apartments that are being mismanaged and bringing the back to life. Due to a 10 capitalization rate, every additional dollar you help generate in this type of value play with apartment buildings you increase the buildings/business' value by 10. Once you've increased the income and stabilized things you can refi your money out tax-free and move on to the next deal. This is how the bigger players are making millions. Again, just seems odd to continue in the SFR game when there's much bigger paydays to be had given your position.

SE Michigan will give you conservatively at least a 12% CAP...and NOT in the HOOD. Not even close.

Apartment cap rates on class A and B product in Charlotte are in the high 5/low 6 range.

Originally posted by @Jerry Kisasonak :

@Steve Tan This whole conversation seems a little off to me. You have 18 SFR in Pittsburgh generating 18% cap. Why not just keep growing in the market you already know and are having success with?

You also have a boatload of capital at your disposal. You could easily purchase a few nice apartment complexes with on-site management and call it a day. Seems strange to be playing around in the SFR game when you can do much better elsewhere. I would consider buying distressed apartments that are being mismanaged and bringing the back to life. Due to a 10 capitalization rate, every additional dollar you help generate in this type of value play with apartment buildings you increase the buildings/business' value by 10. Once you've increased the income and stabilized things you can refi your money out tax-free and move on to the next deal. This is how the bigger players are making millions. Again, just seems odd to continue in the SFR game when there's much bigger paydays to be had given your position.

 I ideally planned on staying in the pittsburgh area but I am a little worried about the local economy to be honest. The point of this thread was to see if there was a new market(city) that people were investing in that yielded high low risk returns. Thats all, I will probably stay in the pittsburgh area then but as of now there is nothing for sale that I am interested in. 

Sorry, but anyone who asks a vague question like, "What is the best city to invest?" isn't ready to be an investor (in my opinion)...

There's no such thing as a best city to invest in real estate.  

Are you looking for single family houses?  Apartments?  Retail?  Strip malls?  Warehouses?  Self-storage?  Office space?  Mobile home parks?  Condos?  Mineral rights? 

Are you looking for cash flow?  Passivity?  Capital preservation?  High growth?

Plus a hundred other factors.

Depending on your answers, the "best" city will likely be very different.  And even then, it's unlikely that there is just one best market...

Originally posted by @Account Closed :

Hello, Im new here but was wondering if you guys had to pick the best real-estate market for investors right now which city would you pick? I have about 3.5 mill to invest and absolutely will not take less than a 10 percent cap rate

Hi Steve,

I see your based in Ohio.

There are so many opportunities in Ohio with some crazy figures.

I personally wouldn't get out of bed for less than a 20% net cap.

We are a smaller operator and can be patient and move quickly when a good deal comes up.

Stay in your own backyard (Ohio) and I am sure you will find some awesome deals.

Just my opinion.

Thanks and have a great day.

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