Interested to hear thoughts from those with experience in very small town investing. My general mentality is very city focused.
I have some new opportunities coming down the pipe in Buena Vista, Virginia. This is a very small town. There are some good fundamentals: local universities, steady employment nearby, low prices. That being said, I don't know what I don't know. Thanks.
Particularly interested in hearing from Brandon Turner, since he has experience with the Montesano, WA market. He always talks about the 'Po-dunk' aspects of REI.
I'm just getting into investing in a small town (pop. 3,500) in the Sierra foothills here in California. I'm buying, fixing, and renting. As I approach being ready to rent this cute cottage, I've asked some locals about the best way to advertise my rental. In addition to mentioning Craig's List, several have said "Word of mouth! Just tell everyone you interact with--grocery checkers, bankers, etc--and you'll have lots of people calling you." There's a fun thing about small-town investing I hadn't thought of.
Furthermore, this particular small town is a bit economically depressed. That could be considered bad, but it also means that lots of folks aren't well enough off to buy, so there's a high demand for rentals and they don't stay vacant long.
Don't know if those items are relevant to your little town, but they're what I've noticed around here.
Best of luck!
For buy and hold, I sometimes remind myself for a single family property I only need one customer at a time. JUST ONE! Same thing goes for flipping I guess, but I don't do any flipping.
I would test the waters first if investing in a small town. Start with one property, see how it goes...
In Regards to small town investing it is different. I have bought a house 5 bedrooms 3 bath. It is a town of 1000 people. I rent rooms in this town. $500. 00 per per month. So far, It has worked well. I had the house for a year. Let's hope this year will be equally as good.
I agree with word of mouth. Just make sure there is need as you exit strategies will be limited. You might want to talk to the universities and see what the on campus housing situation is like. If you are over crowded you would be able to appeal to them as a "solution"
Word of mouth is great advice. That's how my mother started and continued a successful catering business with no budget for marketing, whatsoever.
Definitely, one house is a great way to test the waters in a new market.
Thanks for that. Sometimes I need to be reminded about the obvious stuff, like talking to the people outside of real estate who may be able to provide for my needs (tenants!). Anyway, just added a call to the local university on my task list.
Yeah you know me - I like the small town stuff most of the time! The biggest problem we face is contractors - it can be rough. But I think you can compensate by shopping for properties that might not need as much maintenance )(i.e. newer ones.)
Comps can be a little tough also to come by, and flipping is a bit more challenging. And good property managers might be hard to find.
But a good rental property in a small town can be a terrific investment :)
If there is a university it can't be too small! I deal in rural, semi-rural, and small towns in about a 20 mile radius of my home. The towns (incorporated and unincorporated) range from 1,200 people to 11,000 people.
The word of mouth thing is very important. Your tenants will start telling their friends and coworkers about you and you will start getting people checking to see if you have any open properties. It is kind of nice to know I now have a list of a dozen or so people that want to be contacted when I get an opening.
I am also finding that I can get better rents than I could in the city by maintaining good properties. It is also much easier to find the inexpensive gem homes scattered around because you don't really see have as big of an issue with cheap equaling war zone neighborhoods. You will have a 20-30 year old singlewide a quarter mile down the road from (next door neighbors in many cases) to a $300,000 custom home. If you put some effort into cleaning up the MH and making sure everything is repaired you can get a pretty good working class family in it especially if it is on an acre or so of land so they can have animals. Speaking of which I have a whole lease addendum for livestock talking about pigs and how they must be kept, how many chicks can be brooded in the house, how and for how long, saying yes a baby goat can be kept in the garden tub for up to a week old, which you don't see in them fancy city slicker leases.
Thanks. The only reason I have even considered Buena Vista is because my father, a licensed general contractor, lives about 10 miles away. I think a connection is needed for slickers like me to even consider an area like that.
Interesting thoughts on the livestock. I have no idea where to start on something like that. My standard city thoughts err on the side of 'No animals.' Given the context, I completely understand how this can change, and lead to a profitable situation. I'd be interested to see the lease wording you use, in regards to livestock.
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