What markets work best for the BRRR strategy?

[Brook Decker]

I'm looking to do my first deal using the BRRR strategy and eventually get larger properties over time. I've been working in the Philadelphia market and there seems to be limited options for my budget. I have $30k for a 15% down payment, so about $200k total for the purchase price. Most of the multi-family properties are priced at or above market value or they are shells that need full rehab.

I'm considering looking at other markets, anywhere in between NYC and Northern Virginia (where I am originally from). I wish I could start with a market that I am familiar with, but anything around the DC area is not within my budget. 

Are there any recommended markets for new investors? Does anyone have advice on how to find the right market for a first-time investor? 

[Jerry Padilla]

@Brook Decker Personally, I have seen investors use the BRRR strategy in all types of markets - from low cost to high cost areas, east coast to west coast. Remember when purchasing investment properties you typically need can cash reserves as well.......

Cash Reserve Requirements;

6 months PITI is required on subject property.

If you have 1-4 financed properties than it is now 2% of all unpaid principle balances.

If you have 5-6 financed properties than it is now 4% of all unpaid principle balances.

If you have 7-10 financed properties than it is now 6% of all unpaid principle balances.

Money must be in account for 60 days or sourced. A HELOC can be used as down payment, but not as cash reserves.

Also, maybe you have found a portfolio lender that is willing to go that low for an investment property down payment? But conventional requires a 15% down payment for a SFR and a 25% down payment for a MFR for investment properties.

Do you have a primary residence? If not, consider purchasing a duplex, or possibly a 3-4 unit where you can house hack to get started investing.