Investing in Rural Areas

6 Replies

I live in an area where we have a lot of small towns all over the map. When I say small I mean blink and you miss it small. Most of these towns don't even hit 5000 population. The upside is the property can be picked up much lower than the larger population centers. I am talking like 1/2 the price or lower. Does anyone specialize in Rural properties if so how does it work for you?

Based on our description my answer would be "it depends"...


Because it is all dependent upon the market! Just because the property is 1/2 price compared tot he large population centers, does not make it a good deal/area. I am sure you know this.

I would ask you these questions;

Average Sale Price?
What is the average Days On Market?
What is the ratio of Renters vs. Owners?
Other factors like - city worker population residing outside city? distance to large centers/cities?

I would start there. :)

Do it some of my best deals come from a town that is less than 9k and the other is less than 3k people now these are bedroom communities the advantage is that u can get RD loans for zero down, and less competition

@Chip Chronister Can you explain the RD loans in more details. I live in a rural community 7K or less and am really interested in doing rentals. 

An Rural Development Loan is where the city is 20k people or less, you will need a 640 credit score and the house will have to qualify such as it can not be to old and a few other things

but it is not too bad to qualify for it and the best part of it is that you dont have to put any money down, now you will have earnest money but you will get it back or it will go towards the house. A lot of time buyers are not aware of this kind of loan. When you go to the bank tell them you want this bc the bank will steer you to a conventional loan in which you will have to have to have 20% down or an FHA loan which is 3-6% down depending on your credit. Personally I like using a mortgage broker instead of a bank bc if the broker does not get you the loan he does not get paid sometimes they know how to bend things around to make it work where the bank will just tell you NO!

You must live in the house if you have an RD loan. It is great for fix and flips but I think you can still use it on a 4 plex or smaller but you must live in it.

I know for FHA loans you must live there a year, i believe, is that the same for an RD loan? This is really sounding like a good Idea, and my town is 7k or less population.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here