New investor! Analyzing deals, preparing for 1st purchase!

13 Replies

Greetings Everyone!

I’m new investor currently residing in Bay Area, CA.

I’m looking to start analyzing deals to get my feet wet in preparation for my first purchase.

I would love to know, what markets are good to look at for out of state investments?

Also, as a PRO I have access to all these amazing tools that I have a pretty good hang on using.

Looking for recommendations in workflow when it comes to utilizing these tools.

What have you all found success with in your workflow of finding and analyzing deals for maximizing efficiency?

Thanks in advance, looking forward to connecting!

Welcome Alliya! I am from the NY area and am looking in the Indianapolis, IN area. Right now I am searching for duplexes, triplexes, and quads. Already have a few lined up and looking to partner with other members. feel free to reach out to chat!

@Alliya Pinckney welcome to BP. I was born and raised in the Bay Area myself. I'm assuming that your objective is cash flow. If that's the case, you should have Indianapolis and Kansas City on the top of your short list, not just because of the strong cash flow they offer, but both markets have strong economic and demographic trends with modern, diverse economies. Not all cash flow market have that. An economically thriving and growing market is important to the long term value of your asset. Don't just look at short term cash flow if you are going to be in this for the long haul. We've been active in both markets for several years. I'd be happy to help you if you want to reach out.

@Vincent Catanzaro I would caution you on multi family in Indianapolis. Most MF's are in old, rough areas and don't perform well. We've been active in Indy for about 10 years and I can count on 1 hand how many MF's we've done it that time. Indy is a great cash flow market for SFR but in my experience is not a good MF market. I would approach with extreme caution.

Originally posted by @Alliya Pinckney :

Greetings Everyone!

I’m new investor currently residing in Bay Area, CA.

I’m looking to start analyzing deals to get my feet wet in preparation for my first purchase.

I would love to know, what markets are good to look at for out of state investments?

Also, as a PRO I have access to all these amazing tools that I have a pretty good hang on using.

Looking for recommendations in workflow when it comes to utilizing these tools.

What have you all found success with in your workflow of finding and analyzing deals for maximizing efficiency?

Thanks in advance, looking forward to connecting!

 Welcome aboard Alliya.

Welcome to the family ! Tons of information here, I''m steady learning and preparing to grab my first property as well. I think you'll find the Mid-West like (Cleveland, Kansas City, Detroit) very usueful to invest in for you. Especially being from the Cali market we know how expensive it is out there. 

@Alliya Pinckney Welcome! BP is such a Fantastic resource. 

For me, Redford and Warren Michigan, pass this test quite nicely... Buy $60K-$85K, Cash flow $200+ a door, close to 15% COC ROI. B,C location. I can send examples.

My process for an overhead view of starting from scratch would look like this...


1. Narrow down a list of Metro Locations. Kansas City, Detroit, Columbus, etc...

2. Study the industry, economy, direction its going.

3. Study Realtor.com "Crime Map"  I can't speak too much on this... but a great tool to see "Location/safety"

4. Study Niche.com/google/BP to get a further idea of location/schools.

5. Pick a home profile criteria. 3 bed, 1-2 bath. 800-1400 square feet.

6. Search "Comparable Properties" for estimated ARVs/Values. See what something nice sells for. (Any RE Agent can help)

7. Search this same criteria and look for leases to get an idea of Rents. Do they pass the 1% rule? (Any RE Agent can help)

8. Google Millage rates for Taxes.

9. Plug all of your numbers in the BP, Buy and Hold Calculator.

10. Repeat.

This doesn't include everything, and maybe I've missed something just typing it out, but this could be a quick way to start picking and choosing locations, with a decent amount of due diligence to get started.

Best of Luck!!

Originally posted by @Mike D'Arrigo :

@Alliya Pinckney welcome to BP. I was born and raised in the Bay Area myself. I'm assuming that your objective is cash flow. If that's the case, you should have Indianapolis and Kansas City on the top of your short list, not just because of the strong cash flow they offer, but both markets have strong economic and demographic trends with modern, diverse economies. Not all cash flow market have that. An economically thriving and growing market is important to the long term value of your asset. Don't just look at short term cash flow if you are going to be in this for the long haul. We've been active in both markets for several years. I'd be happy to help you if you want to reach out.

Mike! That is extremely helpful. Modern and diverse with cash flow sounds right up the alley of what I’m looking for. Are you focusing on single or multi family?

 

Originally posted by @Ondrej Brown :

Welcome to the family ! Tons of information here, I''m steady learning and preparing to grab my first property as well. I think you'll find the Mid-West like (Cleveland, Kansas City, Detroit) very usueful to invest in for you. Especially being from the Cali market we know how expensive it is out there.  

Ondrej! Thank you so much! I’ve been looking at the Midwest for certain, just from what I’ve heard on many of the BP podcasts. Are any of these recommended stages local to you? Or are you looking to invest of state?

@Joe Hammel   wow! That breakdown was extremely helpful for me Joe. With all of the reading and podcast, I have a big brain of information now so the biggest struggle I’m encountering at this time is where to start when it comes to analyzing. Your foundation has helped me A LOT. I notice you’re a real estate agent, awesome! In your professional experience, are there any resources that you have direct access to that you believe make your job “easier” than if you weren’t?

@Alliya Pinckney

Glad that helped! 

To answer your question, yes there are quite a few benefits I've noticed. The Knowledge, Resources, Insider Information on a deal, Access to Deals, MLS, MLS Tools, etc., are all very beneficial. This comes with living Real Estate 12+ hours a day 5-7 days a week, as your day job.

For me, it made sense to become an agent. I was looking for a scalable career and wanted to invest more in real estate. I've done a lot of hard things, but the barrier to entry to being a successful Real Estate Agent is extremely tough.

Also, all you have to do, is find a good, "Investor Friendly" and Knowledgeable, RE agent and they can do most of the research and guidance for you. They will help guide you to the deals, and cut down your work dramatically.

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