I'm at a roadblock and could use some help with market evaluation

New to Real Estate · Buford, GA · Member since 2015 · 29 posts · 6 votes

Hello everyone Happy 4th,

I see a lot of advice on how to analyze a deal, how to close a deal and a lot of other amazing advice. But there are some steps that need to be taken before you even begin to analyze that property. I believe that this is where a lot of us new investors get stomped because know that we have an idea on how to invest, we go out looking at all of these properties but we really have no idea where to look. So I guess my question is what are some simple techniques that are being used to evaluate a potential market and submarket? what websites are you using? who are you calling? what kind of questions did you ask when you called? etc etc etc

Thank you in advance to all who reply. Your answers and help is truly appreciated

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Joseph CacciapagliaBusiness Member

Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes

I believe most new investors should focus on their local market, unless it's extremely cost prohibitive or has a declining population. I'm a huge fan of house hacking a small multifamily property as your first deal. It's how I got started, and I believe house hacking in an OK market is better than trying to invest remotely in a better market. If that's just not possible, then I would pick a top 10 city with strong population growth, a diversified economy, landlord friendly laws, and low prices relative to comparable cities. These criteria led me to San Antonio a few years ago, and I believe they still apply. There are plenty of other great markets though, and your personal criteria may vary.

Once you've selected your market, you should start contacting agents and investors to get some insight into submarkets. You should have clearly defined goals, know your budget, and have a good idea about the type of strategy you want to employ. The more detailed your plans, the easier it will be for locals to help guide you in the right direction. I like to end calls by asking if there is anyone else the person thinks I should reach out to. When out of town investors contact me, I usually have at least a couple of people that I recommend they talk to.

[email protected]979-218-2286

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Joseph CacciapagliaBusiness Member
Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
6y
I believe most new investors should focus on their local market, unless it's extremely cost prohibitive or has a declining population. I'm a huge fan of house hacking a small multifamily property as your first deal. It's how I got started, and I believe house hacking in an OK market is better than trying to invest remotely in a better market. If that's just not possible, then I would pick a top 10 city with strong population growth, a diversified economy, landlord friendly laws, and low prices relative to comparable cities. These criteria led me to San Antonio a few years ago, and I believe they still apply. There are plenty of other great markets though, and your personal criteria may vary.
Once you've selected your market, you should start contacting agents and investors to get some insight into submarkets. You should have clearly defined goals, know your budget, and have a good idea about the type of strategy you want to employ. The more detailed your plans, the easier it will be for locals to help guide you in the right direction. I like to end calls by asking if there is anyone else the person thinks I should reach out to. When out of town investors contact me, I usually have at least a couple of people that I recommend they talk to.
[email protected]979-218-2286
Joseph Cacciapaglia powered by Morty
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Account Closed
Rental Property Investor · Mechanicsburg, PA · Member since 2018 · 281 posts · 176 votes
6y
Welcome Salvator! I'll second the advice of @Joseph Cacciapaglia. Look local first. What do you know about Middletown, NY and the surrounding areas. What strategy or strategies are you planning to use? I have never done a house hack but I think it's a great strategy.
Attend a local meetup, talk to fellow investors. Call a RE agent and just ask questions. Check out Zillow, Rentometer - see what the local rents are for the area.
If your analysis shows promising returns then consider investing locally. If not, you've got some analysis experience now to consider other areas. Best of luck
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John LyszczykPro Member
Rental Property Investor · Marine City, MI · Member since 2016 · 145 posts · 230 votes
6y
@Salvator Lorick Thre's a lot to be learned from house hacking your first investment property. You get an idea of what the demand is like in your market and what people are willing to pay.
My best resources have been local Real Estate agents that have a pulse of the demand and understand the submarkets. Call at least 5 agents and ask them about the rental demand and what areas they would recommend investing in. If you find a good/helpful agent that knows the market hold onto them! I recommend referring them business or using them to purchase properties as they will be more likely to help you. Questions to ask:
-What are some good areas to buy a (rental, fix-n-flip, insert whatever)? What are the best areas? What is an area to avoid?
-What is the demand for rental properties like? Are there a lot of renters looking for homes right now?
-Do you know anyone who has rental properties that I could talk to? I'd like to learn more about their experiences.
Secondly, I have printed out the UPDATED zoning maps of each municipality that I invest in so I know what areas allow rental properties (if you're looking for a rental). This is important to know because some municipalities do not allow rentals specific geographic areas as they may have other plans for developing the community.
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Salvator Lorick
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New to Real Estate · Buford, GA · Member since 2015 · 29 posts · 6 votes
6y
@Joseph Cacciapaglia Yes the market that ill be in is pretty high and over priced. I'm looking to shift my focus to the mid west. I wish house hacking was an option for me but unfortunately with my wife and kids it is not(not a lot of multi family where im at). Not knowing what I want is the another problem that I ran into. Kind of hard for a realtor or another investor to help if I can clearly spell out what I exactly need help with. I should probably focus on that and then look for a market. Thank you for such good advice I really appreciate it.
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Salvator Lorick
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New to Real Estate · Buford, GA · Member since 2015 · 29 posts · 6 votes
6y
@Account Closed Thank you. I just moved here right before the virus so its kind of hard to get a good feel for the environment right now. Hopefully when things open up more ill be able to attend some meetups. House hacking does sound good and everyone seems to suggest it but it would not work for my family and I at the moment.
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Salvator Lorick
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New to Real Estate · Buford, GA · Member since 2015 · 29 posts · 6 votes
6y
@John Lyszczyk Thats really good advice with the real estate agent. I never thought of contacting multiples to get different opinions. Having a good agent is definitely a bonus. Like I told Justin not knowing clearly what I want is a big problem that I need to handle so that I can have a better conversation with an agent. I was just saying the other day that I wish I knew what questions I should ask the agent, so thanks. I really appreciate your insight
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Salvator Lorick
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New to Real Estate · Buford, GA · Member since 2015 · 29 posts · 6 votes
6y
Thank you all for your invaluable help, I really appreciate it. Hopefully we can all connect and continue to learn from one another.
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