Property Manager · Louisville, KY · Member since 2020 · 5 posts · 1 vote
Hello Ketuckiana people,
I'm Matt, a local teacher, and I'm looking to buy my first buy and hold investment property this summer, and I plan to house hack for the first year. I live in Louisville in the Highlands currently, but don't expect I'll find a place around there in my price range. I am looking to spend up to $200,000 on a property (single or multi family). I'm wondering about the differences in investing in Louisville (Germantown, Clifton, Irish Hill, Saint Joseph, Hikes Point, Beechmont and some of the areas around there) vs. Southern Indiana (New Albany, Clarksville or Jeffersonville).
Here are things I'm specifically wondering about the differences in:
-Long term appreciation
-Taxes and tax incentives
-Rent prices
-Expected Cash on Cash roi
-The 1% rule (Can I expect to get that or more?)
-CAP Rate
-Expected cash flow/unit
-Any other headache about either state (tenants rights, difficulty with water/electric companies, etc.)
Feel free to share any other helpful information you think a first time investor might need. Thanks in advance for all your help!
Hi Matt. I have rentals in both Louisville and Jeffersonville. The differences I see are that the property taxes are higher on the Jeffersonville house even though the assessed value is much lower on the property. The other thing is the rents are a little better on the Louisville properties.
Hi Matt. I have rentals in both Louisville and Jeffersonville. The differences I see are that the property taxes are higher on the Jeffersonville house even though the assessed value is much lower on the property. The other thing is the rents are a little better on the Louisville properties.
I lived in Souther Indiana all my life. RE taxess are definitely cheaper, appreciation is going to be based on mainly on the street your property is on, the condition of surrounding properties & how good of a deal you get on your property when you purchase. You will have a difficult time finding a multifamily property for 200k on either side of the river in a decent area. The 1% rule is a good rule of thumb if you can find it. Not sure @ what stage you are in your investment career but if I had to do it over again I would buy a duplex for my first property, live in one & rent the other. Rent prices are pretty similar on both sides of the river but I would troll facebook marketplace to get an idea of rents being charged in the areas you are interested in.
Welcome to BP! I can relate to your desire to want to house-hack a property. I purchased a 4-plex in Old Louisville in November 2018 and have been house hacking it ever since. The rents from the other units completely cover the mortgage, taxes, and insurance on the property each month. It's amazing how much more you can save when you don't have to worry about a rent payment!
As for the questions you listed, have you considered attending local investor meetups? There are quite a few in town where aspiring, new and full-time investors come together to discuss real estate related topics. It may worth checking out a few to develop some connections.
One of the nation's most popular investor groups, R.E.I.A (Real Estate Investor Association) has chapters in most major US cities. Our local chapter has over 700 members, many of whom are extremely active in the market and have a wealth of knowledge they're willing to share. They usually meet the last Thursday of the month at Wood Haven Country Club but have moved online since the pandemic began.
Along with that, my friend @Luke Neubauer and I also run a local investor meetup group called the "Louisville Real Estate Investor Meetup". As part of the event, we network with other like-minded investors and host speakers who talk about topics related to real estate investment. Since April, we've been hosting our meetings virtually and have been getting solid engagement.
This month, Brian Hennessey, a top commercial broker in L.A and best-selling author of the "Due Diligence Handbook for Commercial Real Estate", will share his story about how he got started in the business. Along with that, he will explain how to properly perform due diligence on a potential investment property and share various helpful strategies you can use to add value to real estate.
Here's the link from the "Events and Happenings" page of BiggerPockets:
Trying to signup for the meetup tomorrow & it keeps telling me my email is already taken & won’t allow me to sign up. Email is wentworth.dan at gmail.com
I’m also interested in starting to invest in the southern IN area. When I researched property taxes, I found that they are less than 1% in New Albany and Jeff. However on the rookie podcast this week the guest said for investment properties it is actually 2% in Indiana. Can anyone confirm this is correct?
Here is an actual example from a property I was looking at this morning. A house in New Albany with the assessment of $46,500 the 2019 tax is $1048. That is a tax rate of 2.25 percent. Remember that there are no exemptions for investment properties. This house sold in March 2020 for $2,500.