Arizona East Valley Investors

[Eric Kump]

Hello everyone! I am looking to buy in either the East Mesa, Queen Creek, or possibly San Tan Valley in the coming months (preferably east mesa).  I'm looking for a house that my family and I can live in for the next 3-5 years before turning it into a rental property.  What are some things that you look for when running the numbers of a home to find out if it is a good deal?  How much value would an additional bedroom or half bathroom add? Do you focus more on the number of bedrooms/bathrooms or square feet in a property? 

If you have invested in any of these areas I would love to hear about your experience and any other advice you may have.

As a side note I have began to run some numbers on a couple of properties, mainly using Brandon Turner's 4 square method. What calculations do you like to use?

Thanks in advance!

[Ryan Swan]

1) Try to buy something that's similar to other properties that rent well in the same area. So if the best rentals are 3/2, then it would be silly to buy a 5/3 house. It would not only be more expensive to buy, but there may not be the rental demand for it, nor a high enough rental price to make sense compared to your mortgage expense. 

2) Finding a 3/2 house with a den/bonus room and then converting that into a usable fourth bedroom can add value both to appraisals and in terms of renting it. 

3) It's a balance of square footage and beds/baths. A 3/2 with 1500 square feet will feel pretty livable for a family, while a 3/2 with 1,100 sqft might feel cramped.