Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
Hi All,
Looking to explore the Chandler market in Arizona for an investment property. Would love to connect with an experienced real estate agent there or someone who is familiar with the local market here.
Real Estate Agent · Gilbert, AZ · Member since 2016 · 220 posts · 122 votes
8y
Hi @Surendra Chawla ,
What type of an investment property are you looking for? My wife and I grew up in Chandler and currently live on the border of Chandler and Gilbert in a county island. Love the area here.
Real Estate Agent · Gilbert, AZ · Member since 2016 · 220 posts · 122 votes
8y
Hi @Surendra Chawla ,
What type of an investment property are you looking for? My wife and I grew up in Chandler and currently live on the border of Chandler and Gilbert in a county island. Love the area here.
Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
8y
@Justin Owens, thanks for responding. I am looking at a SFH near the Intel campus, but if there are people who are traveling to the Intel campus from Mesa or Gilbert, then those areas will work too. I am looking at a budget of $150-180K and looking at a cash flow or cash neutral property. Do you think one can find one there?
Property Manager · Queen Creek, AZ · Member since 2016 · 608 posts · 426 votes
8y
@Surendra Chawla What you describe is possible in areas that the typical Intel worker will commute from. The areas south and also east of the Intel campus offer great areas with low crime, good schools, shopping, restaurants and newer homes.
The newer homes will reduce your need to do major improvements for years on many of the properties.
As a Broker and a Property Manager, we see many doing just what you are requesting and having long-term success.
Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
8y
Doug McVinua precisely. I need to target Intel populated areas. I work for Intel and I have faith in the long term success of the company. Which will mean that this is a good area to invest in. How much are these new homes costing? What builders are these?
Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
8y
Hi Surendra, which Intel facility are you referring to as there are 2 in Chandler. The pickings are going to be really slim or non existent to find a SFH in the Ocotillio area. Generally under 200K market in East Valley is on fire. Currently I don't see a single SFH in Chandler under 190K on MLS. For that price range you may have to look further out in Mesa/East Mesa/Queen Creek, those are all about 25-30 min drive to Intel.
You may want to consider a condo if you want to be very close to Intel. If you are paying all cash then you shouldn't be cashflow neutral, if you are going to leverage getting cashflow neutral isn't too difficult to find.
Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
8y
@Stone Jin thanks for your guidance. I am basically focusing on Intel renters. Yes, i will be using leverage. The question i have is if Intel employees will commute to either of the Intel campuses from Queens Creek, Maricopa or Mesa?
Real Estate Agent · Gilbert, AZ · Member since 2016 · 220 posts · 122 votes
8y
@Surendra Chawla I live by several Intel employees in south east Gilbert. I have a brother who lives in Maricopa and works at the fab. So yes there are some who make the drive from some distance to get to either Chandler site.
Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
8y
I would agree that certain renters are fine with the commute. I have had people apply for one of my properties in Apache Junction/East Mesa and work at Intel. It really depends on the price point, I wouldn't just focus on 1 group of people. It all still boils down to price of purchase and market rents. There are plenty of qualified tenants that do not work for Intel.
Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
8y
@Justin Owens how much rent do you get in Maricopa for a SFH? @Stone Jin agree with you that i cannot focus on just Intel employees, but being out of state and with almost zero knowledge of the Chandler area, I am focusing on what I know, as an Intel employee :) So, Gilbert, Mesa are going areas nearby to look for SFH? What others are the upcoming areas in Chandler where one can find a deal?
Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
8y
@Surendra Chawla The question you need to be asking yourself is what kind of return you expect on your investment. I assume you are doing a 30 year fixed 25% down conventional loan. If you are looking for no cash on cash return and hoping for appreciation on price, then you can buy almost any house in Chandler and be roughly net 0. If you are looking for 10% cash on cash return then you likely won't find any house in Chandler. I would recommend you do some market research on Zillow and pull up the for sale and for rent listings on the same screen and then do the analysis to see what subdivision meets your criteria. The Phoenix market is not what it was in 2011 where you can make double digit returns on basically everything on the market. Today's market returns on retail/mls are very compressed.
No I have not, but I have lived in Chandler many years ago ('00-'07) and have owned a SFH there (5 mins to Intel at Ray/Rural) which yielded a nice profit back in the day. I live in NorCal now but looking to get back into AZ real estate simply because there are no deals to be had in my local area. So looking to buy what I know (based on past experience). I hear that South of Queen Creek, San Tan or pockets of Gilbert are good to invest even now...
Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
7y
@Anand Krish yes I see a lot of construction in San Tan. But not sure how long will it take for it to appreciate. I don’t want to buy in a place where there is lots of new construction. Are you working with a realtor there?
Property Manager · Queen Creek, AZ · Member since 2016 · 608 posts · 426 votes
7y
Queen Creek, San Tan Valley, Maricopa, and a few others are likely to do well over the next 10-15 years as the roads, etc improve. Phoenix has grown concentrically for decades and based on the planning models I see that trend is going to continue. Dirt in AZ is still fairly cheap and available, with that will be the expansion.
Last week a new freeway loop design was announced in the area we are discussing!!
Queen Creek, San Tan Valley, Maricopa, and a few others are likely to do well over the next 10-15 years as the roads, etc improve. Phoenix has grown concentrically for decades and based on the planning models I see that trend is going to continue. Dirt in AZ is still fairly cheap and available, with that will be the expansion.
Last week a new freeway loop design was announced in the area we are discussing!!
Good to know, Doug. I will be in Phoenix soon. Just dropped you a direct message.
@Surendra Chawla No I am just about starting out and don't have a team (or even a single member of a team for tha tmatter :-)).
I shared the same philosophy "I don’t want to buy in a place where there is lots of new construction" and it paid off for me. Let me explain:
I originally bought in Chandler in 2004 when RE markets were going up like crazy. At that time, I was barely a couple of years into my first job out of school and was very risk averse, and not a lot of savings to put as a down payment. My realtor at that time recommended that I buy in Gilbert (Gilbert was getting built up like crazy during 2003-04) or Queen Creek area for faster appreciation. I said that I wanted to stick to a robust, *low risk* area that goes up steadily over time, and also does not lose value that much in a downturn (this was my first home purchase ever, so I was very risk averse understandably). Ended up buying in Ray/Rural. Come 2007, I was ready to leave AZ and the home in the "sleepy" Chandler area had appreciated 40% in value which I happily sold and took profits on.
In 2009: The recession hit us hard in 2008 and I found that my old home which I had lived in Chandler was now quoting for about 12-14% lower than what I had bought it for. However, the Gilbert homes where many of my friends had bought were underwater by more than 30%!!! Many of my friends who had bought there were forced to not move or rent it out even though they did not want to.
Fast forward to 2017: The home I originally bought and sold in Chandler is now quoting for about 50% up from my original basis, 10 years later (ie, it went down by about 12-14% and then recovered all the way to +50%). Even if I had sold it at the depths of the recession I would not have lost more than 12-14%. But the homes down south of Chandler - totally different story - I would have lost my shirt.
So bottom line, I found that if you buy in a ROBUST area that has demographic tailwinds (jobs, pop growth, income growth) and more importantly, at the right LOCATION, you will not lose money, as long as you are able to HOLD thru a downturn. So I have stuck to that principle and it has worked for me even in my next home (personal residence in CA).
The obvious choice (Call it CHOICE #1) would be to look in the same Chandler area and see if there are any deals there. But unfortunately I am not finding anything under 350K which above budget for me. Which leads me to look further south:
However, if you look at posts from @Doug McVinua and others, he is saying that the same tailwinds (jobs, income growth) etc is favorable for QueenCreek, San Tan etc AS OF TODAY. But I am not sure about its proximity to major employers like Intel or Microchip. Where are the jobs in San Tan?
Nevertheless - I am wondering whether I can venture out a little south of Chandler Blvd (or even South of Queen Creek) and buy something with the understanding that I can hold it for a good 10-12 years (CHOICE #2) Yes, bit more risk but potential for better returns over the LONG term (10 year hold). I dont care much about cash flow as long as I make the mortgage and perhaps have 200$ left over for reserves, capex and opX. Certainly not looking for 1% rule or anything like that!
So: Net net - Here is where I am with a dilemma between
CHOICE 1 (Chandler Blvd/Ahwatukee Hills/Gilbert - PROVEN areas) for an "OK" return for relatively much less risk where I have to cough up 350K for a decent SFH
or CHOICE 2 (San Tan/South of Queen Creek/Coolidge etc) for a bit more risk but better reward and incidentally better cash flow - and yes, LOWER price overall for the property around 200-275K and hence more manageable.
With the following baseline assumptions:
175-350K price range
No Pool
Desert Landscaping in back and front yard
Built in last 5 years and reasonably well upgraded to keep CapX low.
Close to many (preferably high paying) employers
Around 3-4 Bedrooms, 2-2.5 Baths. Prefer Single story if available
Prefer Solar if available
This is kind of where I am right now, continuing to research BP forums :)
@Doug McVinua yeah I agree with the pattern of development in Phoenix. I love the way Phoenix roads are all either exactly N-S or E-W. It is impossible to get lost driving in Phoenix suburbs even for the directionally challenged folks like me :)
Can you perhaps expand more on the San Tan/South of Queen Creek/Coolidge areas?
Who are the BIG employers?
What kind of money do they pay? (Tech works earning 6 figures+ or is it more of blue collar type)
What does living in San Tan or comparable areas feel like (Eg: Does it have good hospitals, parks, schools, well maintained roads etc? Is it a very low crime area - similar to Chandler for example?
What is the population growth compared to supply of homes? WHat is driving that growth?
From what I can tell, anywhere from a couple of blocks north of Chandler Blvd all the way south to Queen Creek seems like relatively lower risk/steady appreciation areas. What do you think?
Singapore, Singapore · Member since 2018 · 57 posts · 11 votes
7y
@Anand Krish those are exactly my thoughts. I am happy to hold for long term as long as rent takes care of the mortgage. I have a job, so not really trying to live life off the cash flow. But I don't want to buy a new construction just because it is cheaper ( and within my budget). Need to understand the potential and risk associated.