Investor · Seattle, WA · Member since 2020 · 106 posts · 89 votes
Hi everyone in Kansas City. What are the best neighborhoods to invest in for cash flow? I am not interested in properties that will rent less than $900. I am looking for solid B class, single family.
@Nam Trang You're smart to focus on areas with rents of over $900/mth. A solid B class neighborhood will be in the upper $900 to $1000 range. From y experience, you'll get the biggest bang for the buck in the suburbs east of the 435 loop. We focus on solid B class neighborhoods in Independence, Raytown, South Kansas City and Grandview. Although there are a lot of good areas, I particularly like the Fairwood and Robandee and Bannister Acres neighborhoods due to their proximity to the new Cerner Corp headquarters. We've been active in Kansas City for several years and know the market well. Feel free to reach out if you want some insight and help.
Hello Nam. This is a great question, and Kansas City is a solid place to invest, when an investor takes the time to understand the neighborhoods. There are dozens of good neighborhoods as well as dozens that aren't so great. However, you can find these $900+ rentals in areas that you may later wish you had't purchased in and the same holds true for areas that you do want to buy.
We are a seasoned company in Kansas City. We do not provide turnkey, but rather a hybrid approach that is client centric. With that, we want to help our clients find properties that are going to yield the best scenario for their long term investment goal. As you know, cash flow is "stronger" on challenging neighborhoods, with less emphasis on wealth accumulation. Conversely, wealth accumulation carries less cash flow initially, but only initially.
To answer your question, part of it depends on your strategy. Cash flow now, versus wealth accumulation over time. The rest can be decided based upon a variety of risk factors. Another very important consideration is finding a property in areas that are not already saturated. Expertise in these areas will help you identify those, and the right team in your corner is the best place to start.
Expect to get a variety of answers here, but always do your own due diligence. KC is largely segregated by school districts, and for the most part, but not completely, the better the schools, the better the area, and the better the long term prospect is for the investment.
All the best in 2020! The best investments are the ones that are research and appropriately guided, but actually taken as well.
@Nam Trang You're smart to focus on areas with rents of over $900/mth. A solid B class neighborhood will be in the upper $900 to $1000 range. From y experience, you'll get the biggest bang for the buck in the suburbs east of the 435 loop. We focus on solid B class neighborhoods in Independence, Raytown, South Kansas City and Grandview. Although there are a lot of good areas, I particularly like the Fairwood and Robandee and Bannister Acres neighborhoods due to their proximity to the new Cerner Corp headquarters. We've been active in Kansas City for several years and know the market well. Feel free to reach out if you want some insight and help.
Hi everyone in Kansas City. What are the best neighborhoods to invest in for cash flow? I am not interested in properties that will rent less than $900. I am looking for solid B class, single family.
@Mike D'Arrigo I have heard you mention Raytown in several posts. I am doing research on KS from Australia, and I am still not fully convinced on Raytown. I looked at zip codes 64133 and 64138 in regards to population and crime rates. Crime was just on the line of what I am comfortable with, and I feel as if I may not be getting the full picture in regards to population. The 2016 census and other forecasts say that the population is basically stagnant or maybe even decreasing...but a lot can happen in 4 years. I feel as if this data may be a bit off? Has the Cerner Campus given the area a kickstart? are there other large employers entering the area? If I were to drive down the average street in Raytown would I see a renovation or two in progress? Could this someday be and Overland Park, Lenexa , or Olathe? or will it go in the other direction of old run down and forgotten.
Any local insight on some recent specifics of this area would be greatly appreciated. I look forward to a response.
@Mike D'Arrigo I have heard you mention Raytown in several posts. I am doing research on KS from Australia, and I am still not fully convinced on Raytown. I looked at zip codes 64133 and 64138 in regards to population and crime rates. Crime was just on the line of what I am comfortable with, and I feel as if I may not be getting the full picture in regards to population. The 2016 census and other forecasts say that the population is basically stagnant or maybe even decreasing...but a lot can happen in 4 years. I feel as if this data may be a bit off? Has the Cerner Campus given the area a kickstart? are there other large employers entering the area? If I were to drive down the average street in Raytown would I see a renovation or two in progress? Could this someday be and Overland Park, Lenexa , or Olathe? or will it go in the other direction of old run down and forgotten.
Any local insight on some recent specifics of this area would be greatly appreciated. I look forward to a response.
Zeke, zip codes are too geographically large to be meaningful. You have to know the neighborhoods. Most of Raytown is what I consider C and B class. It will never be an Overland Park, Lenexa or Olathe, however, those are not good rental areas due to the prices. The Cerner project has had a significant impact on rents, prices and jobs in the immediate area.
Hi Again Mike. So if zip codes are too geographically large to be meaningful how are you gathering data on a neighbourhood? Surely they can at least give you some direction and indication to zone in on an area? What are you using to measure your risk factors of an area? I refuse to rely on cash flow numbers alone.
Hi Again Mike. So if zip codes are too geographically large to be meaningful how are you gathering data on a neighbourhood? Surely they can at least give you some direction and indication to zone in on an area? What are you using to measure your risk factors of an area? I refuse to rely on cash flow numbers alone.
Hi Zeke, did you end up buying a rental in Kansas City?
My experience over the last 7 years in the KC market has taught me that there are plenty of B-class properties that can give you over 1k in cashflow throughout as long as you understand the risk-reward. For example an A-class property is gonna cost a lot more and your ROR will be lower because of that but will appreciate better over time. Whereas a B-class will cost less and the monthly cashflow will be greater primarily due to the cost and location. The tricky thing with B-class is that they are not all made equal and more due diligence is required unless you have boots on the ground that knows where to look. PM if you are interested in seeing my portfolio for B-class properties that are getting more than 1K per month I might be able to help you. Anyways I hope that helps and best of luck!