Indianapolis - College to Keystone, Arsenal Park to State Fairgrounds
Hi everyone!
I'm looking around Indianapolis trying to find neighborhoods that I'd like to focus on. I like the south Broad Ripple area, but there isn't anything meeting my criteria at the moment. I've started looking a bit further south and am curious what others think of the area just north of the fairgrounds.
I haven't driven this area yet and I don't believe it is technically considered part of SoBro, but it seems that it could be in the near future. Does anyone work in this area currently? Would you consider it a good place for someone buying their first rental? Or should I stay north of 46th?
Thanks for any insight!
Kat
I think it heavily depends on your goals of investment. If you have a certain amount of cash to invest that may limit where you can look. Also who are your target renters? The closer to broad ripple the more renters there probably are but also the more maintenance you'll have to do between renters due to their likely age range and lifestyle choices.
I don't know the specific area you are speaking of but I strongly believe you should take the time to determine your niche before buying the first property. It will help you stay focused and not just buy the first thing that comes along.
The area near the fairgrounds is pretty rough. Not your typical Broadripple renter.
@Kat W. you didn't state whether you were looking to buy an old or if you were looking to do a quick flip.
In my opinion if you're looking to buy and hold long-term now may/might be a good time to enter as its still "edgy" but some trend towards change . The rents are decent for what you're "all-in" numbers should be so if your looking for future equity or "banking" until it's time to flip you should be ok.
If you're looking at just doing flips in that area margins are tight on most deals and you'll get caught between doing a basic flip (level 1) and a upscale flip (level 2 or3). You'll need to be sure of your DD and all-in numbers.
That area south of 46th right in there is still pretty rough, and the housing stock itself is less than desirable. Its possible long term you'll see improvement, but it's going to be a while. Rents are pretty low over there still.
That said, once everything between 46th and 52nd gets the SoBro bump, one would think that would hop over 46th to the south. There was a time when south of 52nd was all pretty bad, and now most stuff there is over $100k.
I'm also looking a lot in southern part of Butler Tarkington....city via the midtown TIF is pumping a lot of money in that area, the area is surrounded by the cities best cultural assets, and they have a strong neighborhood association.
Lived in Broadripple for a long time, and now the "Sobro" area. One rental on 44th and another purchased on 42nd by College. The "Meridian Kessler Zone 4" area is growing for higher average wage per home. I'd say the younger job having crowd is somewhat focused more around a few anchors of SoBro. Moe and Johnnys / 20 Tap along with Fresh Market (53rd and 54th street) is a better direction to stick to that type of renter.
Now the question of how far would I go away from the 54th block for the higher class renter? 42nd. Though a great team is doing some amazing high quality work like this one at the block of the 40th. Don't do 38th unless you are very sure of what you're doing in that area - like around the Ivy Tech building maybe. But that's not SoBro to folks at all.
http://www.zillow.com/homedetails/3962-Carrollton-...
Here's the next project that I'm personally hopeful for in this area. And will be a good area I think for my next rental purchase. I'll be looking around there.http://www.ibj.com/articles/52510-developer-buys-f...
The more direct answer to your question though. Once you go a few streets towards fairgrounds it can get more towards the lower renter quality and even poorer quality maintained homes.
Maintenance aspect is higher here for these homes though anyways. I mean many are built around the 1910-1920 range with tons of deferred repairs needed for the "deals". If you do buy for your first rental, personally I would head to far away from College.
Make sure you have an intelligent and chatty inspector walk through with you before you buy, there have been some not so top quality flippers putting paint on a pig in this area and would be a headache of deferred maintenance for a first rental.
I would agree with several of the previous comments. The area south of 46th is definitely a level down from north of 46th. East of the Monon Trail to Keystone can be edgy/sketchy/questionable, but there is definitely housing stock which looks quite affordable & your pro-forma cash flow will look good on paper.
I saw an MLS listing on 44th & Kingsley the other day that looked quite decent in terms of condition & it was listed at $19.9k. Selectively, you can find numerous SFRs below $25k, and sometimes below $20k.
If you decide to buy, I would think that tenant selection is paramount and you should not factor in too much appreciation into your numbers. Said another way, at least for the time being, you should look at it as a pure cash flow investment, and even then, go into it with eyes wide open.
I would highly suggest you drive the neighborhood to get an idea - you can do it in less than 30 minutes, and if you are planning on making an investment in that area, that is the best "investment" you can make.
@Beau Benjamin My goal is to start a portfolio of buy and holds, and eventually, I'd like to get into some flips.
@Mark McGarvey I knew the area had been rough in the past, but was/am hoping to find the the positive growth of South Broad Ripple is moving south to the northern border of the fairgrounds. I've been watching north of 46th St and just recently my curiosity was sparked further south.
@Kerry Edwards I am looking to buy and hold. Someday I'd like to try my hand at flipping, but I don't believe I have the experience/cash to go that direction. You hit my thoughts exactly with your second paragraph. My estimations for the area looks like cash flow is there now, and that there is a possibility of revitalization on the way. I'm just worried that the revitalization may be too far in the future for a newbie like me to handle the current renter pool.
@Rusty Scott Thank you for your thoughts! When I first moved to the Indianapolis area about 10 years ago, I'd never set foot south of 52nd, but now visit the area restaurants regularly.
@Shannon S. For some reason I'm unable to tag your name. Thank you for your informative post! Near the end of your post, did you mean to say, "personally I WOULDN'T head too far away from college"?
@Matthew Schroeder The house on Kingsley is one that I've used for my estimations in the neighborhood. I have no expectations for appreciation in my calculations, however, I would be very happy if I could buy, hold, cash flow for a few years eventually the neighborhood coming up enough that we are able to flip and raise rent or sell. My husband and I are planning to drive the area and all surrounding areas tomorrow.
Thank you for all the great advice and information!
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#2 New Member Introductions Contributor
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Welcome.
Locate and attend 3 different local REIA club meetings great place to meet people gather resources and info. Here you will meet wholesalers who provide deals and rehabbers (cash buyers).
Two Great reads, I bought both J. Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbook
Download BP’s newest book here some good due diligence in Chapter 10. Real Estate Rewind Starting over
Good Luck
Paul
INREIA meets 2nd Tuesday of each month
AlpineSolution meets the following Wednesday
I don't know when CIREA meets but it's once/month
You can get info on all three of these on Meetup.com
And most importantly, an unofficial BP meetup will be later in the month. Watch here for details.
These are great events to network with people doing, or wanting to do, what you do.
Come and start crushing it!
Hi Kat! What is your criteria? I know you are interested in buy and holds but what kind of cap rate are you looking for? Purchase price? My husband and I are also looking to get a rental or two sometime in the near future but we've been too skeptical about the properties we've found to pull the trigger. Like others have suggested, I'd stay away from houses near the fairgrounds. There are plenty of other good pockets around Indy that you could own and feel safe about going to visit. I think the best advice is to just drive the neighborhoods and talk to the neighbors. Don't be in such a hurry that you are willing to buy just anything. Ask yourself if you would live in the area you are considering buying in? Would you feel safe going to the neighborhood alone?
Best of luck in your search!
This is a pretty small geographic area. Why are you limiting yourself to this area which is pretty marginal at best?
@Paul Timmins Thank you for the book recommendations. I have one of them downloaded and in line to read, the others will be added.
@Dennis Weber Thanks for the meeting and their information! The only one I've had on my list to visit was the CIREA. About the unofficial BP meetup, will it be posted here with Indianapolis in the post? If so, my keywords should notify me.
@Christy Barton $70,000 is approximately the max I can go all in at this point in time. I'm not sure what my goal is for a cap rate. I believe my goal for COC is 15%, but I've only just started considering it. Prior to this, I've been looking for a goal of $200 cash flow a month after all expenses.
I'm very much a newbie and trying to learn as I go. The few times I've posted here on Bigger Pockets, I've come away with more questions to find answers to. I really appreciate the insight, caution and information.
@Mike D'Arrigo I'm not limiting myself to only this area. Its one I came across and searched here on the forums and found little information, so I started a thread to learn more.
I will still be driving the neighborhood tomorrow as well as several others, but from the information everyone has shared here, I highly doubt I will move forward in this neighborhood at this point in time.
Thank you all for helping me out! I'm doing my best not to be embarrassed by how little I know.
What are your thoughts on this area now that 3 years have gone by? I am looking at a duplex on Crittenden north of the fairgrounds. I see a lot of SFH comps 2/1's going for over 100k.