I have 190 K to purchase a rental home

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Travis Biziorek
Investor · Arroyo Grande, CA · Member since 2014 · 1k+ posts · 1k+ votes
2y

Hey Ramon, fellow Californian here... just down on the Central Coast.

I'd look at the Midwest, specifically, I like and invest in Detroit. I have 12-doors there and they've been extremely good to me.

With $190k I'd look to either do a duplex and a single family home or two single family homes.

Rents on the first option would probably be in the $3,200/mo range with all three doors. If you went with two SFH's you'd probably be looking at $2,400-$2,600/mo between the two.

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  • Andrew Bang
    Lender · Texas; Arizona · Member since 2019 · 276 posts · 282 votes
    2y

    San Antonio

    1Reply
  • Ramon Vargas
    OP
    Member since 2023 · 9 posts · 5 votes
    2y

    In the areas in San Antonio

    0Reply
  • Rick Albert
    Real Estate Agent · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    2y

    Basically what you are asking is where are the properties that give you more than the 1% rule. That's going to be tough. I recommend you get creative. 

    Do you own a home now? Could you house hack? 

    If not, you are likely to have to look into the the Midwest and south and will likely require some form of rehab. 

    1Reply
  • Erik EstradaBusiness Member
    Lender · Member since 2022 · 6k+ posts · 1k+ votes
    2y
    Quote from @Ramon Vargas:

    So I have 190 K to purchase a rental property. I need to find a place in the US that can give me at least $2000 in rent so that I can pay for the loan. Any suggestions?


     Hey Ramon, 

    I see you are in California. Have you considered buying in CA? Two huge changes that can help housing affordability: 

    1. FHA now allows 75% of ADU rental income to qualify for a mortgage.

    2. Starting Nov. 18th you may put 5% down on a conventional 2-4 unit purchase loan. 

    With these changes you may very easily achieve $2000 in Rental Income in CA. 

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  • Ramon Vargas
    OP
    Member since 2023 · 9 posts · 5 votes
    2y
    Quote from @Rick Albert:

    Basically what you are asking is where are the properties that give you more than the 1% rule. That's going to be tough. I recommend you get creative. 

    Do you own a home now? Could you house hack? 

    If not, you are likely to have to look into the the Midwest and south and will likely require some form of rehab. 


    0Reply
  • Brian Larson
    Investor · San Jose, CA · Member since 2018 · 313 posts · 230 votes
    2y

    @Erik Estrada makes some good points.  If you are just looking for another city to review, try Pittsburgh, PA.  I have had good luck there.

    1Reply
  • Ramon Vargas
    OP
    Member since 2023 · 9 posts · 5 votes
    2y

    I own my home. I have a mortgage on that one as well. I don’t think I could do a house hack because I live with my wife and kids in California and I want to purchase out of state.

    0Reply
  • Julius Clark
    Real Estate Agent · Indianapolis · Member since 2023 · 52 posts · 33 votes
    2y

    Indianapolis!

    Just put in an offer on a house in a $175k house in a great area with LTR rents at $1550 we are going to be looking at this one as a MTR renting above $2000 a month. 

    Best I have seen on a LTR house for rents in the price range is $1800. Have you thought about the MTR or STR strategy?

    1Reply
  • Ramon Vargas
    OP
    Member since 2023 · 9 posts · 5 votes
    2y

    @Erik Estrada those are great points and good to know, I prefer to see if I can find a single family home and rent.

    0Reply
  • Ramon Vargas
    OP
    Member since 2023 · 9 posts · 5 votes
    2y

    @Julius Clark I will look into Indianapolis. MTR and STR will that be similar to Airbnb? I thought about the strategy, but was thinking of doing LTR and get a management company to manage it for me

    0Reply
  • Julius Clark
    Real Estate Agent · Indianapolis · Member since 2023 · 52 posts · 33 votes
    2y

    MTR is Mid-Term Rental. Most commonly used by travel nurses and construction workers in Indianapolis. 

    STR is your traditional Airbnb. I do find that my some metrics the Airbnb market is fairly saturated in Indianapolis. Quality areas will always have demand.

    LTR is going to be really hard to find cash flow, especially with paying 10% for management. Management can be pricy on MTR and STR but typically the added cashflow is worth it. 

    If you do decide to look more into Indianapolis I can help connect you to the team that you'll need based on your preferences. 

    1Reply
  • Jake AndronicoBusiness Member
    Realtor · Reno, NV · Member since 2019 · 1k+ posts · 938 votes
    2y

    @Ramon Vargas

    $190K gives you quite a bit of flexibility. $2,000 in rent is just part of the picture, the expenses are another. 

    We see a lot of California investors invest over the hill in Reno because of the low property taxes, favorable landlord laws, appreciation outlook, job growth, population growth, and also being close enough to make a day trip to the property. 

    No market will be perfect. I'd recommend visiting different ones before making a purchase :)

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    3Reply
  • Bud Gaffney
    Rental Property Investor · Boston, MA · Member since 2019 · 2k+ posts · 1k+ votes
    2y

    New Bedford, MA

    0Reply
  • Travis Biziorek
    Investor · Arroyo Grande, CA · Member since 2014 · 1k+ posts · 1k+ votes
    2y

    Hey Ramon, fellow Californian here... just down on the Central Coast.

    I'd look at the Midwest, specifically, I like and invest in Detroit. I have 12-doors there and they've been extremely good to me.

    With $190k I'd look to either do a duplex and a single family home or two single family homes.

    Rents on the first option would probably be in the $3,200/mo range with all three doors. If you went with two SFH's you'd probably be looking at $2,400-$2,600/mo between the two.

    4Reply
  • Ramon Vargas
    OP
    Member since 2023 · 9 posts · 5 votes
    2y

    @Travis Biziorek Hey Travis,

    Thanks I will look into purchasing 2 single family homes. I like the idea and I see Detroit has a numerous amount of SFH's under 80k. Any neighborhoods you recommend?

    0Reply
  • Travis Biziorek
    Investor · Arroyo Grande, CA · Member since 2014 · 1k+ posts · 1k+ votes
    2y
    Quote from @Ramon Vargas:

    @Travis Biziorek Hey Travis,

    Thanks I will look into purchasing 2 single family homes. I like the idea and I see Detroit has a numerous amount of SFH's under 80k. Any neighborhoods you recommend?

    Yeah, happy to connect and chat about areas I like. I’ll send you a direct message. 
    0Reply
  • Matthew Irish-JonesBusiness Member
    Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
    2y

    @Ramon Vargas are you buying cash or can that amount be financed?

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  • Michael SmytheBusiness Member
    Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
    2y

    @Ramon Vargas

    You might want to follow the "Deep Dive" series we're doing on our BiggerPockets blog about Metro Detroit cities, City of Detroit Neighborhoods and comparing Metro Detroit to other hotspots investors usually consider:

    https://www.biggerpockets.com/member-blogs/3094/99854-deep-dive-into-metro-detroit-cities-ecorse

    Our analysis is a template you can follow for any city, but doubt you'll find this much info for any other market in the US.

    So, why would you invest remotely anywhere else?

    How can we assist you further?

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  • Patrick DruryBusiness Member
    Real Estate Agent · Columbus, OH & Cleveland OH · Member since 2021 · 1k+ posts · 2k+ votes
    2y

    @Ramon Vargas
    Those numbers are achievable in the Columbus and Cleveland markets. You can find deals that meet the 1% rule. 

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  • Joe HammelBusiness Member
    Real Estate Agent · Metro Detroit, MI · Member since 2018 · 614 posts · 666 votes
    2y

    Another vote for the Metro Detroit Area. Attached is a pic of my portfolio here. You'll see the column for # of doors. A duplex and couple of quads in there with locations.

    @Travis Biziorek knows his stuff too, if you connect with him.

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  • Tamara Martin
    Capitola Beach, CA · Member since 2020 · 12 posts · 0 votes
    2y

    @Ramon Vargas We are paying 12% on 2nd position loan for rehab for 1 year, no prepayment penalties plus 2pts.

    0Reply
  • Tamara Martin
    Capitola Beach, CA · Member since 2020 · 12 posts · 0 votes
    2y

    @Erik Estrada do you know if JADU income is included?

    0Reply
  • Tamara Martin
    Capitola Beach, CA · Member since 2020 · 12 posts · 0 votes
    2y

    @Julius Clark How do you solicit for MTR?

    0Reply
  • Steven WesolowskiPro Member
    Realtor · San Antonio, TX · Member since 2023 · 276 posts · 42 votes
    2y

    San Antonio. There are always rentals with tenants who have never missed payments, being putting on off-market near the downtown area, and are at half the amount of cash price you are willing to spend right now. The most important thing is that you get a solid virtual tour of the property and thorough profit analysis. There are also several duplexes that will need some repair, but nothing that will hinder starting tenant move-ins, and a few I have seen that are jumping from $1500/month to $2200/month this past quarter! It's remarkable the opportunities that popping up in the area, but again you are going to want to see proper data, acceptable repair cost, and desired location and attraction to tenants.

    1Reply
  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    2y
    Quote from @Ramon Vargas:

    So I have 190 K to purchase a rental property. I need to find a place in the US that can give me at least $2000 in rent so that I can pay for the loan. Any suggestions?

    Hi Ramon, I personally love Columbus Ohio and as someone who works with a lot of out of state investors - there's so many catalysts for why you should invest here. Specifically, there's job growth (Intel, Honda, Amazon, Nationwide, etc) and the population is growing (unlike Cleveland or Cincy). I really see Columbus Ohio as an extremely safe bet for the next 10-20 years. Plus, there's still so many positive cash flowing and 1% deals here in Columbus Ohio. As a local investor and agent here in Columbus, let me know if you have any questions or want to connect!
    [email protected]614-300-7535
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