Buying an income property in Kansas City

28 Replies

Hello, 

I have been searching through for income properties in Kansas City. The numbers are pretty good but since I am from California, I was wandering if anyone has any knowledge about different neighborhoods there. I likes the opportunities in Raytown and the area close to the Kansas City Zoo. Please let me know if you have any experiences in these areas or if you have any recommendation about other areas as well.  

Thank you, 

Hamid 

I have a good TK provider in Kansas City that sold me a house on E 104th street, I am happy with it. 

Hi Hamid,

We offer turn key properties in Kansas City. Raytown is a good area but there's better areas that around the zoo. It's pretty spotty in that area. I prefer to stay outside of the 435 loop in areas like Raytown, Independence, Grandview and the Bannister Heights area where the property @Account Closed mentioned is located. We do a lot in that area. It's going to be a real up and coming area with the Cerner Corp redevelopment of the Bannister Mall. It's a $4.8B commercial development that is expected to create 16,000 new jobs and is the largest development project in the history of the state. Feel free to contact me if you'd like more insight. You can also find some good info on KS on my website.

@Mike D'Arrigo   I agree with you totally about the up and coming area in KC due to the redevlopment.  I am in Denver now but lived in KC for 10+ years up until 2013.  I am interested in TK investments as well in KC and sent you a PM in regards to that.

@Account Closed   The area around the zoo can definitely be hit and miss.  So my best advice is really do your research on the specific houses you are looking at to make sure they are in an area you are comfortable with.

@Account Closed I'm presuming that you're referring to the property on 8400 E. 104th St. That is my partner Mark Edmondson's. Mark was just on my radio show yesterday and profiled that property on the show. It went under contract to a buyer today. I'm a little confused on why you say you bought it. Am I missing something here?

@Hamid Taba

 @Account Closed

Hey all I live in Kansas City and bring a plethora of personal and professional investing experience so if any of you need any questions answered I am happy to help if I can.

@Hamid Taba -- Josh here from Atlanta. I'm a newer investor, so no advice today -- just a question for you, and for the BP community.

Have you considered hopping on a plane to Kansas City? I have often wondered why people invest out of town (especially new investors) without making the relatively small investment of visiting the actual property they are considering.

Besides, if you make the trip, you can make a detour to Niecie's for Chicken and Waffles or  LC's for some world-famous barbecue. Sounds like a great trip to me! Maybe I should invest in Kansas City...

Originally posted by :

Have you considered hopping on a plane to Kansas City? I have often wondered why people invest out of town (especially new investors) without making the relatively small investment of visiting the actual property they are considering.

I wouldn't say that you have to visit every property you buy but it's certainly a good idea to visit the market and learn about the areas. That way when a property becomes available, you know the area. It helps to have someone on the ground that you can trust so that you don't have to fly to the market for every property.

Originally posted by @Hamid Taba :

Hello, 

I have been searching through for income properties in Kansas City. The numbers are pretty good but since I am from California, I was wandering if anyone has any knowledge about different neighborhoods there. I likes the opportunities in Raytown and the area close to the Kansas City Zoo. Please let me know if you have any experiences in these areas or if you have any recommendation about other areas as well.  

Thank you, 

Hamid 

Raytown is good, as is Grandview. I would stay away from the area near the zoo, it's pretty sketchy. You definitely want to be either west of Troost or east of 435.

Originally posted by @Andrew Syrios :
Originally posted by @Hamid Taba:

Hello, 

I have been searching through for income properties in Kansas City. The numbers are pretty good but since I am from California, I was wandering if anyone has any knowledge about different neighborhoods there. I likes the opportunities in Raytown and the area close to the Kansas City Zoo. Please let me know if you have any experiences in these areas or if you have any recommendation about other areas as well.  

Thank you, 

Hamid 

Raytown is good, as is Grandview. I would stay away from the area near the zoo, it's pretty sketchy. You definitely want to be either west of Troost or east of 435.

I agree with Andrew's comment.

Of the areas mentioned in the thread, in my opinion in terms of overall performance, Grandview is top, then Raytown, then Independence, than Bannister/South KC, then Swope Park/Zoo area inside 435 (MO side).

I have been buying in Grandview and South KC for 3 years now and love the area for rental income.  On average we are seeing 15.6% net return for all of our investments.  We have some that return as high as 24% and the lowest being 11.6%.  Finding good deals is becoming harder and the returns are going down but it is still easy to find a return of 11+% on your money.

One thing to keep in mind is that Cerner is just beginning construction on its new Trails Campus in the Bannister/South KC area. It's actually going to be in place of the old Bannister Mall. 

Originally posted by @Vince Cline :

One thing to keep in mind is that Cerner is just beginning construction on its new Trails Campus in the Bannister/South KC area. It's actually going to be in place of the old Bannister Mall. 

That is true, and I hope it has a big positive impact on the area.  But the existing big Cerner complex right off 435 hasn't helped lift the area much since all the employees commute in, so I would recommend that your deals stand on their own 'as-is' not counting on too much lift from the new complex, if we get lift then good for us but I would not pay any premiums for that area.  

Originally posted by @Cliff Harrison :
Originally posted by @Vince Cline:

One thing to keep in mind is that Cerner is just beginning construction on its new Trails Campus in the Bannister/South KC area. It's actually going to be in place of the old Bannister Mall. 

That is true, and I hope it has a big positive impact on the area.  But the existing big Cerner complex right off 435 hasn't helped lift the area much since all the employees commute in, so I would recommend that your deals stand on their own 'as-is' not counting on too much lift from the new complex, if we get lift then good for us but I would not pay any premiums for that area.  

 Cliff, I certainly agree with you. I wouldn't recommend anyone change how they calculate a deal based on the Cerner project. However I just thought it was worth mentioning since the new Campus is scheduled to bring in 15,000-16,000 jobs over the next 10 years. I believe Cerner west employs around 4,000. There will definitely be a lot of commuters at the new campus but I hope as well that it will boost the local economy. Regardless it's great for Kansas City and the metro. Hopefully we can chat a bit more at some point. 

I would agree with @Cliff Harrison and @Vince Cline

 in terms of the cautious steps revolving around the new Cerner campus and its potential impacts on a community and the surrounding neighborhood.   This new campus is at the junction of four zip codes...64138, 64137, 64134 and 64132.   A smart investor will do their own due diligence about these neighborhood through resources such as city-data.com and others.  Find economic stats and other important stats that are useful in determining the attractiveness of a particular neighborhood.

Once they have a clear understanding of the neighborhood, they are better armed with information about whether these new 16000 new employees will be living in these areas with their average of $75000 salaries compared to the average for residents in the area of $34629.

Kansas City was ranked #8 for best commuting times in the nation for a city of its size with an average of 22 minutes for a commute averaging 9.16 miles.

I run a real estate office 34 miles away from my house with a commute time of 37 minutes.  Personally, I live in my submarket because of GreatSchools , yet run my office in the middle of my market area because of location.  Kansas City is a commuter city.  Those with $75K jobs have many submarket options available to them....

Final note on Cerner....their current campus headquarters office is located in North Kansas City.  The neighborhood surrounding this campus has seen no change in more than a decade of their presence in the area.  To Cerner's credit however, they have brought amazing healthcare IT to our market area, sold to hospitals and doctors offices around the world.  Great company and great for KC.

Originally posted by @William Robison :

I would agree with @Cliff Harrison and @Vince Cline

 Once they have a clear understanding of the neighborhood, they are better armed with information about whether these new 16000 new employees will be living in these areas with their average of $75000 salaries compared to the average for residents in the area of $34629.

Final note on Cerner....their current campus headquarters office is located in North Kansas City.  The neighborhood surrounding this campus has seen no change in more than a decade of their presence in the area.  To Cerner's credit however, they have brought amazing healthcare IT to our market area, sold to hospitals and doctors offices around the world.  Great company and great for KC.

It's important to understand that this is not simply Cerner moving their headquarters to a new site. This is a $4.3B multi use commercial and retail development project and is the largest development in the history of the state of MO. The development will include 2 120,000 square foot data centers, a 155,000 sq ft conference center, an early education center, a 125,000 sq ft service and distribution center, a 156 bed hotel and a grocery store. It's hard to imagine any scenario where all of that will not create a substantial number of working class renters. This is not just about creating $75,000 salary jobs at Cerner for people that are going to go live further out in more affluent suburbs.

this is really interesting. im actually working on the new cerner three trails campus project as an electrician. I keep wondering how the 16000 jobs are going to affect the real estate market in the area.

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Hello College student here very new to the real estate scene it is noted that cerner has promised 2 million to the neighboorhood, and 6 million to the development after it is complete. That also may effect market values for the neighboorhood. http://fox4kc.com/2016/03/18/cerner-building-project-promises-to-reinvigorate-bannister-mall-area/

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I live in kansas city and prefer north of kansas city metro.   alot of great neighbourhoods and the liberty school district is the best 

Great area @Jay Smith but low returns for real estate investors.

Mackaylee Beach, Real Estate Agent

Great area to invest. I frequently have property in the Cerner area. 

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