Top three markets you are researching?

56 Replies

@Ian Walsh , what are those markets and what do you like/dislike about them?

I found myself sticking to local real estate mainly for the fact that I could be there, on site, to fix a problem when it occurred. Now that I am across the country from 21 of my units, I am happy that I am not there fixing the problems. I have a great partners @Nicole Lane, and @Brandon Magierowski  who take care of any issues better than I could. I think the thing I loved the most about being there in person was the relationships I built with people who are now key players in my investing. No doubt there are better markets out there than Panama City, Fl. However a decent market with a great team will outperform a great market with no team IMO.  

Ramsey

Originally posted by @Ramsey Blankenship :

@Kelly Zimmerman i am headed to Salt Lake City next week for work. Hadn’t considered it. What should I check out while I am there? 

 I like the areas north or south of slc. Provo the obvious one south and Logan to the north. Low taxes, low insurance and easy tenants for the most part. 

@Terry Lao you lost me when I got to Stockton at number 4 on the list. Maybe things will pick up eventually but it’s a dump and a war zone. Yes there are some few and small nice neighborhoods but seems risky to me. I suppose it can only go up but it reminds me why I don’t take stats without thinking beyond the numbers. Especially forecasts (or wild guessses). 

@Ramsey Blankenship I'm in Spartanburg, SC and Hickory/Lenoir, NC.  You can pick up some nice cashflow deals in Spartanburg right now with good potential for long term appreciation.  They've put a lot of effort into revitalizing the downtown area and it's pretty nice.  20 mins outside of downtown are the suburbs which are nice.  The area between downtown and suburbs is where I'm investing.  You have to drive the neighborhoods yourself though.  One block might be decent with long term homeowners and the next be methlabs and people just hanging out all day (no jobs).  It's really tricky, but I've gotten good tenants and inherited good tenants.  I can usually buy a decent house for around 20k and rent it for $550.

At times I wonder that people who actually make loads of money from real estate investments will put out their secret study analysis here for everyone else to grab - while that area is still on a path of progress.

The 80 city list fails to mention many such places. Google alone isn’t enough.

@John P.

The forecast top 100 is only forecast, as actual will be determined in coming year. I'm vested in #1 ranked Las Vegas, and have been since 2013. Based upon historical, I would say my cashflows, ROI, is about 10-14%, and appreciation is about 10% on one 4plex, and the other about 50%.

YMMV (your mileage may vary).

Terry

Originally posted by @Terry Lao :

@John P.

The forecast top 100 is only forecast, as actual will be determined in coming year. I'm vested in #1 ranked Las Vegas, and have been since 2013. Based upon historical, I would say my cashflows, ROI, is about 10-14%, and appreciation is about 10% on one 4plex, and the other about 50%.

YMMV (your mileage may vary).

Terry

 Terry- No offense but a monkey throwing darts at a dart board has made great returns in real estate the last 5 years.  Only the most unlucky has not. I am just saying that when getting into forecasting the future you need to look beyond the numbers an to see Stockton that high makes me question the use of such a chart.

@John P.

Forecast is opinion. Everyone has opinion. I grew up in Stockton, so I know what city is. Now, Im in southern California. Real.com is reputable. However, having one city at #4, that you do not like, does not mean rest of 99 on list is wrong. 

If Realtor.com got 50-60% is good forecast. I'm in accounting and finance, so I understand the forecast. And based upon the bottom remark by Realtor.com, they state the data used to compile list, which is fine and logical.

It is like a handicapper at the race track, every has an opinion. Then after the race, then the one wins gets the bragging rights. Now, if you don't bet, then you really cannot say much, other than I would have won if I bet.

Terry

Haha, @Jon Huber . Was thinking the same thing. My phone's been pinging me all week.

I'll weigh in @Ramsey Blankenship as a real estate agent and investor here in Tucson, AZ. We have a really cool market down here: a hodgepodge of college town, retirement community, a major military base and AirBnB-friendly tourist town with world class golfing and cycling, all with a healthy infusion of Mexican culture. You won't find a better breakfast burrito anywhere.

Buy and hold works pretty well here. Barring the air force base closing down or major student loan financing reform there will always be a demand for rentals in the area. Relatively low median home price, so there is a lot of out-of-state attention for multifamily. Good deals exist, and good deals get bought in a couple of days. We do generally mirror Phoenix and are expecting a strong summer.

Feel free to PM me if you'd like any specific info on the market.

Ramsey,

If your headed to SLC? Make sure and check it out. It sounds like you enjoy the outdoors. Hard to beat SLC and the state of Utah.  The airport is undergoing a major expansion, and companies that spend alot of money on research, have started internatinal flights.  The term "Silcome Slope" is getting attention, along with many high tech firms moving into the state. This is both for the talent pool, and quality of lifel

Best of luck!

I'll give you a bit more than you asked for...

Currently invested in two markets:

1) Jax 2) Indy. Both offer low price points, strong cash flow, good growth metrics, fairly easy to travel to. 

Have researched and made offers, but nothing purchased yet:

3) Atlanta - mature market but still really strong growth potential, personal familiarity, decent price points and decent cash flow.  

4) Chicago - possible future retirement location. In the right neighborhood, potential major appreciation longterm. 

Researching with great interest but not quite ready to pull the trigger:

5) Tampa - Just sold a multi so no longer have any property in this market. But if we decide to diversify within FL this would probably be the area. Have some familiarity. 

6) Philadelphia - Like Chicago, possible future retirement location and potential major appreciation longterm. 

7) Louisville - I think this metro has a shot at being a Denver/Austin/Portland. A city that 15 years from now we look back on and marvel at its explosion in hipster popularity and lament the insane real estate prices :) 

8) NWI - Offers proximity to Chicago along with the low price points and strong cash flow (and pro-landlord laws) that are found in Jax and Indy. 

@Todd Dexheimer Thanks for sharing. My business partner and I are in the process of identifying which two markets in the country we want to focus on for our syndication. We are residential developers from Boston making the shift towards MF syndications. Your post was very helpful. We're suffering from too many interesting choices! 

Originally posted by @Derek Robinson :

@Ramsey Blankenship I'm in Spartanburg, SC and Hickory/Lenoir, NC.  You can pick up some nice cashflow deals in Spartanburg right now with good potential for long term appreciation.  They've put a lot of effort into revitalizing the downtown area and it's pretty nice.  20 mins outside of downtown are the suburbs which are nice.  The area between downtown and suburbs is where I'm investing.  You have to drive the neighborhoods yourself though.  One block might be decent with long term homeowners and the next be methlabs and people just hanging out all day (no jobs).  It's really tricky, but I've gotten good tenants and inherited good tenants.  I can usually buy a decent house for around 20k and rent it for $550.

What are the primary economic drivers in these locations. I know Hickory used to be a major furniture town however if I am not mistaking, the major factory shut down a long time ago. $20k is very inexpensive - I don't think I could buy a mail box in San Diego for $20K

@Maxwell Lee thank you!  What do you consider a strong cashflow?  Also, I invest in the North Florida market and love it. Have you seen any issues with insurance premiums in South Florida?

Hello All:

Regarding the list, be careful with Deltona-Daytona Beach.  There is a new Margaritaville active adult community there (several thousand homes) which is probably skewing all the future sales forecasts.

Bob

@Ramsey Blankenship I'd say the economic drivers are much stronger in Spartanburg than in Hickory/Lenoir.  I invest in SFHs in Spartanburg, but I'm investing in mobile home parks in Lenoir/Hickory.  I haven't researched much in SFHs in Hickory/Lenoir.  That being said, yes, the area was big in furniture in the hay day, then took a down turn.  Google actually has a large data storage facility in the area, plus there is a fiber optic cable manufacturer that produces the most fiber optic cable in the eastern US.  It's in an upswing, but I doubt it will blow up, certainly not as much as Asheville.

Originally posted by @Ramsey Blankenship :
Originally posted by @Jon Huber:

I think everyone's city keywords just blew up in this post... 

 What cities are you researching and why?

 1) Southeast Florida. Miami up to Port Saint Lucie. Why? Because a good portion of my portfolio is already there, I live there, and I am familiar with the market.

2) Tulsa/OKC. Why? 7-9% Population increase, 25k+ income per capita, 180k+ avg home value, sub-4% unemployment

3) Charlotte. Why? 11% population increase, 33k income per capita, 256k+ avg home value, sub-5% unemployment

(Statistics courtesy of www.city-data.com)... HIGHLY recommend this site for data geeks.

There are MANY cities that fit these profiles in the country. 

Why did I choose these? Because I have been to these places, and I like the way I feel about these cities when I am there. If you want to invest around the country, I suggest spending the couple hundred to get on a flight and go explore that city. If you are willing to drop a couple hundred thousand for an investment, it's worth the weekend in a hotel. I have been to many cities this way, had myself a great time, but also felt that it wasn't right for investing. Trust your gut.

So to recap... you can invest ANYWHERE in the country. You can find your numbers to work within two hours of any market. It's just a matter of your level of comfort and your familiarity.  

Originally posted by @Ramsey Blankenship :

@Maxwell Lee thank you!  What do you consider a strong cashflow?  Also, I invest in the North Florida market and love it. Have you seen any issues with insurance premiums in South Florida?

 1.5-1.75% price-to-rent. 

Don't know about insurance premiums in South Florida. Haven't seriously researched for investments and in fact we're renting.