Where should I look to invest

Question

Hi BP,

Early this year I made my self the commitment that buy a multi family property but so far the biggest problem I had is committing to an area to farm.  I'm from North NJ and have looked at places like Allentown PA, Pittsburgh, Orlando, parts of NJ, Jacksonville FL, plus a few others and now I'm overwhelmed and lost.  What I like to invest in is a Class C multi family building with less than 50 units with some upside.  I'm happy to partner up with a more experience investor help find properties and also find private investors depending on the size of the deal.

Todd Dexheimer · Answer

I would research those markets and pick one. Then focus on finding a deal in the one market. Meet the brokers and property managers and have a specific plan.

Chris Grenzig · Answer

@Jorge Mendez Jacksonville is a great market that we love and there's tons of C properties in the size and space. When trying to find a market to invest we always tell people a few things to consider.

1. Do you have family somewhere? Start in that market and see if you like it, if not then move onto the next

2. Is there somewhere you like to travel to, know well, or would like to go to regularly? As a property owner you should be going to check in on your property fairly regularly, so you should like the area you're going to.

3. How far away do you want to be from your current location? How easy is it to get there? Drive or Fly? Are there any direct flights? How much do the flights cost? etc...

4. Pick some "bigger" markets and then look at the surrounding submarkets and see if there are any you like.

We have JV'ed with people in the past who have brought deals to us that fit our criteria. If you want to chat let me know and we can set something up.

Hopefully that helps somewhat!

Joey Hamaoui · Answer

Hi @Jorge Mendez I'll be happy to connect and answer any questions you may have about the Jacksonville market. It definitely has a lot of long term potential. More and more jobs are moving here in different sectors and the city is doing a lot to invest in long term growth such as the deepening of the river to allow for larger cargo ships to come in. Its really a great place.

Stephanie Jacobson · Answer

Too bad about your poor experience in Binghamton! Like @Chris Grenzig I know of some good managers too, and the area is really strong for student rentals. Let me know if there's any way I can help!

Lesley Resnick · Answer

I do not know much about the other locations, but Jacksonville is a rocking market now.

Where every you invest, just be careful not to buy into an overheated market.  By that I mean an area in which the average worker can not afford the average house.

PM me If you are interested in hearing more about what I am seeing in Jacksonville.

Harold's is the best deli in the N Jersey.

Jorge Mendez · Answer

Thanks @Andrew A. Orlando is another market I've research a bit some weeks back which seems great.  I would love to know more about what you are currently working on or RE plans for the near future perhaps we can help one another or partner up on a deal or two.

Thanks @Chris Grenzig I like your tips.  :)

Your first tip has proven to be very successful for me other the last few years, I still own the 3 of 5 properties which are closes to me.  Unfortunately NJ is a bit expensive for multi-family, just the other day I was looking at a 12 unit apartment building for 1.8M with a 6.8 Cap Rate and no upside.

I've made my share of mistakes because I did not consider #2, I was attracted to Binghamton NY a few years back because of the high Cap rate but poor property management and my lack of visiting the area cost me a lot of money.

At this stage in my life i'm so what financially stable that I can make the time to drive or fly to visit and manage the managers of remote properties.  I'm definitely interested in partnering with either someone or a group who has done a few deals to avoid costly mistakes.

Andrew Ashby · Answer

@Jorge Mendez, welcome to BP! You're in the right place. I live and work in Orlando, and my properties are located in Jacksonville and Chattanooga. My next investments will be in the Orlando area. I have market reports on the Central Florida market (Orlando Metro) and I'm happy to help in any way that I can.

Stephanie Jacobson · Answer

It can get tough depending on where the properties are, too. I don't hear of too many landlords having issues with students vandalizing, more that they just don't take great care of the apartments. And of course, bad management can kill good investing.

Sounds like you're well on your way to something great in Jacksonville, but Binghamton will miss you for sure!

Good luck and keep us posted!

Jorge Mendez · Answer

@Lesley Resnick believe it or not I live 3 miles away from Harold's Deli in Lyndhurst.  I've never gone there before but i'll try this weekend and report back.  :)

You make very good points about rental markets and location, all which I've tried considering.  Currently I'm evaluating two 50+ unit buildings in Jacksonville going for 2.3M I could use some local expert in looking passed the numbers before moving passed the analysis phase.  I'll message you my number in a bit.

@Stephanie Jacobson, the student rental market was what I was after when I purchased my two family home in Binghamton mostly because at the time SUNY was planning on expanding the University by 2,000 students.   My mistake in Binghamton like I mentioned before was of poor management and scale.  In the 5 years I owned my rental, I had a mortgage of $500 per month including taxes and collected rents of $1,300.  The problem year after year was cost of repairs after a student lease was up and vandalism.  Perhaps if i had purchased a 20 or 30 unit building things would be different.  I actually have a friend how started investing in Binghamton when I started 10+ years ago and he is going great.  He owns about 8 multi family houses.

Jorge Mendez · Answer

@Chris Grenzig I no longer have properties in Binghamton nor do I plan on investing there in the near future.  My plan as of know is to look at three places.

Jacksonville FL: Seems to have the most potential long term and as you indicated a good amount of Class C properties.

Allentown PA: has a good amount of development in the last few years and I like because of proximity

Cranbury Township NJ: Amazon and other companies have invested quite a bit in this area

I would greatly appreciate if you could help me connect with a few brokers in the Jacksonville area

Where should I look to invest

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