Most profitable markets for $200K?

Question

I have $200K to invest in cash. What market would you recommend with maximizing cash flow in mind (not appreciation)?

Account Closed · Answer

Why not do a few flips in michigan market, not detroit, areas like lansing, jackson, Ann arbor, or kalamazoo. Once you double your cash on hand start with a couple buy and holds while flipping to continue to raise your capital level.

Jeffrey Townsend · Answer

Very True @Patrick Britton. I agree

Bob E. · Answer

Do you need the cash flow now or would you be willing to wait 5 years if you could get double the return?

if you can wait I would buy properties in high cap markets with 50% cash down and owner finance the rest for 4-7 years.  We have listed properties like this in the past and will be listing another soon.  Rents fully cover the PITI and in 5 years when the loan is paid off you have double the return you would have gotten with a straight cash purchase (since your tenant paid for half the house for you).

Alan Morrison · Answer

Rural MI has some incredible markets just waiting to be tapped into. For affordable properties that you can rent out consistently at reasonable rates, check out Lake Orion, Oxford, and Saginaw. Even out in the sticks you can find good deals!

Cheryl Schlehuber · Answer

You can buy a pretty decent vacation rental in the U.P. that is either on the water (Great Lake or inland lake) or has a view for that amt. or less. ...

I'm a Realtor and own a real estate and property mgmt company at the  Straits of Mackinac .....

Come on up and have some fun:)

Middy Matthews · Answer

You are correct Janeen.  I'm not sure you could purchase much here without spending a lot and taking some risks.  Check out 1014 Main Street for example.  This place is right across from the stadium and should be gold, but it's at 555,000 and would house 8 but not separate bathrooms, etc.  Great fraternity house!  Also, it was a NonProfit so there are no tax records.  How do you feel about buying something not knowing the taxes?

Janeen Bertolina · Answer

So true that Michigan is a great state, and it's not all like Detroit. Ann Arbor is a hopping college town.  IMO Ann Arbor doesn't necessarily has high cap rates, partly because the property tax is pretty high and the city inspectors have high standards to meet. But the nearby Ypsilanti has higher cap rates, but the tenants are riskier, generally speaking. I have found that's how it goes: higher cap rates are in locations where the tenants are riskier.

Middy Matthews · Answer

If you're actually looking in Ann Arbor, I can help you.  I'm a realtor and can, at very least, set you up with an alert for properties within your price range that you can then research.  I can also help you put in your offer and deal with the other realtor.  Always remember, hiring a realtor won't come out of your pocket if you're buying property.  The seller, under most circumstances, pays the realtor fees.  FSBO often play by different rules, but even some of those will pay the fees to get it sold.  This protects you, as the buyer, and gives you an assistant that will make sure all the paperwork and documentation is presented correctly for a smooth transaction.  Did you say, "What about the title work?" Well, yes, we handle that too.

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Patrick Britton · Answer

To maximize cash flow versus appreciation I would say stick to multifamilies in markets with high capitalization rates.  I would have a look at specific areas of Michigan, such as Ann Arbor.  Very often people shy away from Michigan believing the entire state is like Detroit.  It isn't.

Tatiana Gershanovich · Answer

@Matt Smith I like TN, GA, TX, NC for cash flow if you want to be a landlord. If you just want to have a passive income without a hassle of being a landlord, then you can do a private lending (in this case you don't need to go that far :))