market analysis....how and where to start?

Question

Greetings all,
So, I have the desire. I have the work ethic to dig in and do the research, but...Where do I start? How do I identify and find information about a specific market? I am willing to invest outside my region if the financials add up.

I know this website is a great start and I plan on spending many hours reading and listening to podcasts, but, what other sources are there?

I am looking for multi-family units that meet the 2% and or 50% rule I have read about on this site. I am willing to be patient but want to start actively working toward finding a property.

Any thought on this topic are much appreciated.

Thanks, Nate.

Brandon Turner · Answer

Hey Adam Demchik - I think it still should ideally apply.  However, with a large property, I'd stay a little further away from the "rules of thumb" and dig down and actually look at the history of the property. I mean, I'd still use the 50% rule and 2% rule to do quick calculations, but only to quickly sift out the bad ones.

Marco Santarelli · Answer

Hey Brandon Turner,

I'm already working on an article/post on the subject of "good locations to invest".  Hope to have it done by the weekend!

Stay tuned...

Marco Santarelli · Answer

Hi Nate Waters:  In case you missed it, read my last post on your other thread here:

http://www.biggerpockets.com/forums/55/topics/90998-new-from-southern-california

Feel free to post any other questions you have.  :-)

Continued success!

Adam Demchik · Answer

Brandon,

Regarding the 2% rule...does it apply to larger complexes?  I'm looking in the 30-50 unit range.  I'm not finding many that satisfy the rule but a lot that come close.  The properties cash flow well with over 15% CoC return and about 150/door/month with 25% down.  Any thoughts you can provide would be helpful.  Thanks.

Adam

Brandon Turner · Answer

Hey Nate Waters welcome to BP! I'd say the first thing to do is to get real comfy with the basics and the math (which maybe you are already.)  A great place to start is the  "The Ultimate Beginner's Guide to Real Estate Investing."

As for finding good locations to invest,(which would make a great blog post, so maybe I'll work on that!) I'd start by looking nationwide at the average rent vs. purchase price. I hear Texas is good. I'm sure there are programs out there, but I'd just hang around BP and see who is doing a lot of deals. Then look in their areas. Compare prices on Realtor.com with the rents listed on Craigslist and you might get a good idea. Then, connect with local investors in those areas - who might even wholesale great deals to you.

There is always the "turn key" option - but you probably aren't going to hit the 2% rule on that, but it might be worth it for the ease and convenience.

Anyways  welcome and let me know what you think of the Podcasts!