I am looking for stable cash flowing properties and I came across a few listings in 63136. What are your thoughts on investing in this area? I am a beginner in REI and my biggest struggle is getting started with real estate.
Hoping to have some fruitful discussions. Thank you!
Specialist · O'Fallon, MO · Member since 2010 · 148 posts · 46 votes
6y
I'm in O'Fallon, MO west of this area of St. Louis. This is a lower income area. There are always people needing affordable homes. But this area is riskier for tenants. As you are dealing in the city of Florissant at this point. The appreciation on property won't be as good as if you invest in other areas of St. Louis. Still in the city but the potential to rehab, gain a lot of equity, and rent to hold opportunity is better in like the 63108, 63118, 63116 zip codes. There may be other areas as well. As Kathy said a Pm could help. But if you do your homework in those zip codes you can do it yourself. Online tools are very helpful. As some real estate websites give free info. I like not to promote or anything Realtytrac as you can put in a street name and get values comparable as an appraiser is likely to do by area and sq ft with repairs done. By using the currently solds, for sale and such.
Rental Property Investor · St. Louis, MO · Member since 2014 · 741 posts · 424 votes
6y
We all struggle. Let's look at the numbers. @Rajan Chidambaram Siva Since you want cash flow, we must look at the rental income. What are the area rents? Would your tenants pay (the rental income) the mortgage, insurance, property tax and insurance? If so, we might look further: is there some left over rent money for the maintenance and occasional improvements? If it passes this test, it might be interesting. Next, what shape is it in? What improvements are needed to get market rents? The answers to these questions will help determine if the listing is a good deal, or not. Do you live in St. Louis?
Thank you for your response. The property I am looking for fulfills all of the criteria that you just mentioned. The house is in good condition and it is generating positive cash flow. My only concern is and this may be due to my anxiety before I purchase my first property, will the area still be a viable place that renters would want to live over time? Since I am not from St. Louis or I have not lived there, I am not sure of what to make of the area (especially since the crime rate is much higher than the national average). Based on google maps, the area looks decent and there are several amenities (Walmart and Sam's Club) around the area.
Rental Property Investor · St. Louis, MO · Member since 2014 · 741 posts · 424 votes
6y
@Rajan Chidambaram Siva Hi Rajan, Google maps is a good start. You need a team on the ground. Will you use a property management company? Send her the potential addresses. When I started investing, I was living out of state and found agents who were willing to help. A thumb up or thumbs down from my property manager was important.
Hi Kathy, I didn't know I could ask a property management company to do that. I don't have a company right now but I will find out one that will help me with this. If you don't mind me asking, do you know of a PM company that you would recommend?
Specialist · O'Fallon, MO · Member since 2010 · 148 posts · 46 votes
6y
I'm in O'Fallon, MO west of this area of St. Louis. This is a lower income area. There are always people needing affordable homes. But this area is riskier for tenants. As you are dealing in the city of Florissant at this point. The appreciation on property won't be as good as if you invest in other areas of St. Louis. Still in the city but the potential to rehab, gain a lot of equity, and rent to hold opportunity is better in like the 63108, 63118, 63116 zip codes. There may be other areas as well. As Kathy said a Pm could help. But if you do your homework in those zip codes you can do it yourself. Online tools are very helpful. As some real estate websites give free info. I like not to promote or anything Realtytrac as you can put in a street name and get values comparable as an appraiser is likely to do by area and sq ft with repairs done. By using the currently solds, for sale and such.
Rental Property Investor · O'Fallon, MO · Member since 2018 · 2 posts · 0 votes
6y
@Kathy Utiss
I also am from Ofallon MO and I agree fully that the area around florisant is a lower income area and managing thoes properties will be a little more hands on than other areas but it can be a little bit cheaper to attain thoes properties. If you can network and speak with other investors that own property in that area they can give you a good idea of exactly how they made thoes properties cash flow.
Investor · Atlanta, GA · Member since 2020 · 253 posts · 240 votes
6y
Did you ever end up investing here? I actually grew up in 63136 (The Castle Point neighborhood). Castle Point is probably the worst neighborhood in 63136 and some streets there can look like the worst parts of North City, which is literally one of the worst areas in the entire country. I would tread very cautiously and wouldn't do it before actually driving around and seeing things for yourself. I drove around there a few weeks ago and was sad at the condition of my old neighborhood.
I am looking for stable cash flowing properties and I came across a few listings in 63136. What are your thoughts on investing in this area? I am a beginner in REI and my biggest struggle is getting started with real estate.
Hoping to have some fruitful discussions. Thank you!
Rajan
@Rajan Chidambaram Siva, if you're in need of money here in Columbus OH, I can recommend some good local HML's. However most of the time you will need some experience and an "okay" PFS.