Investor · Los Angeles, CA · Member since 2014 · 122 posts · 35 votes
Quick survey...
What do you consider to be the best States with the best returns for Multi-Family Investing?
Essentially which state does your dollar go the furthest where you get the best return.
Real Estate Agent · Plano, TX · Member since 2015 · 734 posts · 511 votes
9y
@Jamie Garcia the answer to that question, as to many others, is "it depends". We all value our dollars differently.
Some believe that cashflow is the most important thing, some preference the appreciation gain. I suspect A class property buyers will have different answers than D class property buyers.
Having said that, personally, I prefer the southern states because it's closer to home (Texas) and because of the massive job growth the south is enjoying in recent years. So, Texas, Oklahoma, Florida, Alabama, etc. are my target states these days.
Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
9y
@Jamie Garcia I like the market in PA. i buy 4-8 properties a month here for myself and my partners. I help hundreds of other investors get started here. The prices are still within reason for the average Joe.
Multifamily Syndicator · Austin, TX · Member since 2015 · 127 posts · 247 votes
9y
I second "it depends".
Also think its equally important to look at and think about individual markets rather than just states. We're focused on Texas (because we live here, but also because it has excellent job and population growth) but within the state there are tremendous differences in markets, and submarkets. Nacagdoches TX is very different than Austin, which is different than San Antonio.
So look at the state, but also identify which MSA and submarkets appeal within those states.
I'll go with Nevada, specifically Reno and Las Vegas. First no state tax, which could easily be 8-10%. Second, close to Southern/Northern California, which real estate is beyond what most people can afford.
Third, see below for Las Vegas home sales. Mar'17 up 28% year over year.
Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
9y
Jamie Garcia all is turn key investors go to IN GA AL TX TN MO. But if you want needles in the haystack just know your are going to have to work your *** off in this market. If not take the 20-40% irrs with turnkey.
Perhaps the trend of businesses migrating out of California can give you good information about where to invest. Employment growth happens when new companies arrive, and a real estate investor would love to have properties for the employees that come along with the company.
People also leave Cali in search of a better place (less expensive place with a less oppressive government) to retire. If you can flip properties in towns where the influx of California retirees is just getting started, you could position yourself to remain and busy and profitable for years to come.
Look at Bend Oregon. Over the past 25 years, the town has grown close to five times over. My parents were among those who sold their house in California and moved to Bend in the mid 90's. They say they've been watching a steady stream of Californians migrate in since they arrived.
Lender · Fort Washington, PA · Member since 2017 · 17 posts · 5 votes
9y
@Jamie Garcia It's hard to pinpoint the best, but as a general rule of thumb aside from crunching the financials. Consider a property that is located within a city with a population of at least 25,000, that is within 25 miles of a major city that has a population of 100,000+.
Real Estate Investor · Encinitas, CA · Member since 2016 · 3k+ posts · 3k+ votes
9y
@Jamie Garcia Oh these pesky hindsight questions! It's pretty easy to take a look at the high cash-flow markets. They are all over BP and if the SFRs cash-flow then (for the most part) multi-family properties will follow suite. You can also rank items that are more akin to "fixed costs" like property taxes. Texas is horrible, Alabama is great (just to pick two random states). The hindsight issue is with appreciation, if you had bought 5 years ago in Austin I'm guessing that (despite property taxes) you'd be happier with the appreciation compared to a similar dollar investment in Alabama. That could be "standard" appreciation in 4-or-less units or rental appreciation with commercial multifamily property. In periods where you are looking at significant appreciation (since it's a part of 'best returns') you then have to think about how much growth runway markets like Seattle, Austin, Denver, and Nashville have. Or, conversely, take an educated guess on what city will be the next Austin, the next Nashville, etc.
Kirkland, WA · Member since 2016 · 12 posts · 11 votes
9y
The state where you do your due diligence, know the local market, and have a strong local team. "Best" is a complex question depending on your target profile.
For example:
Do you favor appreciation or cash flow?
Are you investing short or long-term?
Buy and hold, fix and flip, development, or reposition?
How much initial and eventual capital invested?
What level of neighborhood (A, B, C, mistake)?
Which industries do you want to support?
The order is Why, What, Where, How:
Why am I doing this?
What am I doing?
Where am I doing it?
How am I doing it?
2 before 3. Different markets are better for turn-key, active turn-key, and development due to market cycles, provider availability, etc.
Real Estate Professional · Phoenix, AZ · Member since 2014 · 26 posts · 30 votes
9y
Hi Jamie:
If you're new to real estate investing, I would recommend staying close to home. Typically, you have more resources, contacts, know the market better and have more synergy in markets close to home. All this boils down to less risk and a higher chance for success.
If you're going to bring investors into your deal, they will want to kick the property tires. If investors have to get on a plane, it's going to be harder to raise money.
Everyone is trying to find the next best market. Don't be afraid to look in your backyard.