What are best markets for Cash Flowing Multi family investments ?

11 Replies

@Murali Mudddan Markets don't provide cash flow or appreciation...neighborhoods do...and more specifically, properties do...looking at this through a macro lens won't end well for you. Most metro statistical areas have populations over 2 million...that is a lot of "market" to pin-point a single cash flowing property...I know everyone talks about "markets" but this is not the right approach. Moreover, why is cash flow important?...you're saying you would trade $200/mo in cash flow over $150k in equity over a 10-year period??? I've never understood that mentality...

If you don't need the cash flow to meet your living expenses right now, it becomes a play for stability and long-term appreciation. 

https://www.biggerpockets.com/...

@Murali Mudddan

I’d say your local market is the best market to start out in, just go find the cash flowing deal which is best accomplished by finding MF with below market rents. Besides your in Texas! Sure beats NY :) good luck!

Originally posted by @Murali Mudddan :

I am looking to buy multi family. What are the best markets in terms of Cash flow  and Long term rent growth, property values etc.

Columbus, Cincinnati, and Cleveland, Ohio.

I started purchasing small multifamily in Columbus, Ohio a little over 3 years ago and have done extremely well. The cost of entry is low while the cash flow is high. Columbus is the only Ohio market that has seen a rapid growth in jobs and population.

@Brandon Sturgill , I have been wrestling with cash flow positive vs appreciation dilemma for a while. I have a cash flow positive property ($400 a month) and a cash flow negative ($250 a month) property. Both are SFHs in the Atlanta area. The latter (cash flow negative one), being inside the Perimeter, appreciates faster than the former, which is in the suburbs. I'm not sure if the cash flow negative property was a good investment, despite the fact that it appreciates faster and collects a decent amount of equity every 7-8 years. Any thoughts?

@Eland Lord It's about the long-term...does the one that is not cash flowing cover debt-service?...if so, its a winner...even if not, the one that is performing better covers the difference....you could always trade it, but what would it be worth in 25-years?

@Brandon Sturgill , it is $250 a month short of my PITI payments. It is in a desirable, family-oriented area, around Spaghetti Junction in Chamblee (a mile ITP). They are building a new Publix right outside the subdivision (tenant can walk to the Publix from the property). I can get about $400K for it today, but everything else is expensive, so what would I do with the money? As far as appreciation, I'm 55 so 25 years is a long shot, but I'm confident it will probably triple in value in about 15 years or so.

@Murali Mudddan

Cash flow properties, rent growth, population growth, job growth, job industry diversification (I.E. not being tied to one particular industry are great and disciplined investment criteria. 

We've seen growth that follows along these lines in the sunbelt/southeast. Charlotte, Raleigh, Atlanta, Jacksonville, Tampa have continued to grow and that growth has been accelerated by covid-19 and the relocation of people from northern cities to the southeast. The impact hasn't just been individuals but companies as well (Goldman Sachs moving large portions of their teams to the south for example). Additionally, the new emphasis on remote work continues to spur multi-family demand as people relocate as they shift to full remote work.