Where to begin - REI

[Grayson Warren]

I am a beginner looking to purchase my first REI property and have a couple questions:

Is it wise to jump around to where the hot markets are to look at properties to invest in as opposed to sticking to one city or zip code and becoming an expert there?

I have several colleagues who have been obtaining 0 down construction loans in the Little Rock, AR and Conway, AR areas. Is this realistic for any city to obtain these types of loans? What are the pros and cons of this?

Thanks so much!

[Jonathan Greene]

Don't make the mistake of seeking out a hot market. By the very fact that the market has been identified as "hot," it means you are too late to benefit as much as you could in another market. This is more specific to first-time investors because of capital concerns and knowledge. Are you looking for straight investment, buy and hold, or house hack or flip? If you are in Plano, you should be able to source deals in and near your backyard and do very well by learning your home market first and over time, figuring out where the next hot market is close to you. The best tip for finding the up and coming market is taking the one everyone tells you is hot and driving two towns out in each direction and then checking the sales comps in those areas. Driving will tell you what is coming, like if Starbucks and Whole Foods move into "fringe" areas that aren't selling well, that will be a hot market in a year or two.