What markets do you have your eye on for LTR in 2023?!

[Michael Junior]

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

[Bonnie Low]

Cincinatti > Dayton > Columbus

[Alex Olson]

Midwest has been good to a lot of investors. I am partial to kc. Have to have a good team. I can show you some good examples. Just DM me. 

[John Morgan]

Dallas/Ft Worth area due to low inventory and population and job growth.

[Jimmy Lieu]

Quote from @Bonnie Low:

Cincinatti > Dayton > Columbus

 Columbus > Cleveland > Cincinatti

[Remington Lyman]

Quote from @Jimmy Lieu:

Quote from @Bonnie Low:

Cincinatti > Dayton > Columbus

 Columbus > Cleveland > Cincinatti

 Columbus, Cleveland, and Cincinnati all have solid opportunities. I like each one for different reasons.

[Travis Biziorek]

Hey Michael, 

We seem to have extremely similar paths here.

I was in the Metro Detroit area in 2017 and built a 12-door portfolio from 2019-2021. I then moved back to California in 2022.

I also help people, usually out of state investors, get started in the Detroit market since I have such a strong network there.

Happy to connect and talk about the Detroit market. You can still find cash flow and, if you know what you're doing, you can set yourself up well for some great potential appreciation. There is a ton of revitalization happening in the city. So understanding the landscape, trends, etc. can be extremely beneficial. 

Shoot me a message if you want to connect.

[Andres Murillo]

Quote from @Michael Junior:

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

 Hey @Michael Junior! I threw this graphic together to help describe why investors are choosing to invest in specific markets. It is certainly NOT a perfect tool, but it's based on feedback from clients I've helped over the past 6 years. The markets you see here are the places where I've helped clients to buy, this is NOT a comprehensive list of every US market worth investing in. You'll notice I also don't have any breakdown for submarkets - this is vital when you're considering growth. Each of these metro areas will have submarkets that lead the way in growth or fall behind the market rate. You must understand your submarket well when choosing a market. 

[Becca F.]

@Michael Junior

I invest in the San Francisco Bay Area and Indianapolis metro area. I'm not buying in the Bay Area for now with the high price points and interest rates. Many investors here are currently flipping not doing long term rentals. 

I have 2 SFHs in the Indy area. The Class A SFH is in a sought after suburb with highly rated schools and has appreciated a lot. Market rate rents have increased $300 a month over what I was charging my tenants - I'm increasing their rent, not by $300. I recently closed on a Class C moving up to a Class B move-in ready home, tenants are moving in soon. My property taxes have gone up significantly with the Class A home. Property tax rate is 2.77%. I don't have any exemptions since I'm an investor (primary homeowners have homeowner and supplemental exemptions which brings their taxes down significantly).

I'm revisiting the idea of investing in California, not the Bay Area, but less expensive parts. We have Proposition 13 so our property taxes only go up 2% a year until we sell (new buyer passes property tax on current assessed market value) or do significant renovation. Other states don't have this type of proposition to limit tax increases, as far as I know, and SFH home values have skyrocketed across the U.S.

I really like Indy - it has a good mix of appreciation and cash flow, growth and different industries. Other markets that I've considered are Nashville Tennessee and Florida Panhandle (Navarre Beach, Fort Walton Beach, 30A Area) since so many people seem to be moving to Florida. 

[Adrienne Green]

@Michael Junior what investing strategy are you looking to do?  SF, MF, flips, BRRRs, STRs, LTRs, etc?  Are you looking to invest in a market that's already demonstrated strength, or bet on something that may or may not take off later? 

The best market would depend on what you want to do.

In the most general sense, of course people are favoring the sunbelt states as the population there grows, and the laws are landlord friendly.  I help investors buy in Chattanooga, TN.  It is a market that's been doing well for years, and continues to exceed national averages in terms of population growth, job growth, and market values.  Is that the kind of thing you're looking for?

[Ricardo Hidalgo]

Quote from @Michael Junior:

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

 Panama City beach has options under 350k generating 45-55k 

Navarre beach right now is more long term hold on appreciation since they are investing 300 million on the beach. 

Mexico beach is a long term appreciation play that is being built out by st Joe foundation and company (hedge funds that owns over 172,000 acres on the emerald coast.)

what is your cash on cash return expectation or equity growth? 

[Villy Ellinger]

@Michael Junior well you definitely have a lot of option and advice, lol. Check out Northwest Florida. We have a house shortage and lots of people moving here. Also, lots of military needing housing. The last two years have seen a huge surge of investors buying short-term vacation rentals, but in the actual housing rental market there is still a lot of demand and very insufficient housing. A bunch of military bases here too -- so lots of resale demand for residential homes. And, you know, you'll be by the beach :-)

[JD Martin]

Every realtor under the sun is going to come in here and tell you that their market is happening. I'm a realtor too and I would tell you that about my own market (which would be the truth, but we have enough people here already and I don't want anyone else moving here so there's that). 

There's no way to answer your question without understanding your goals, ability to buy, exit strategy, intended rental class, etc. If you told me that you only wanted to rent "A" housing to "A" tenants I would tell you my market is a waste of time. 

[Trevor Aydelott]

Quote from @Paul Stamm:

Hey @Michael Junior! Happy to hear you're looking to grow your portfolio. Indy is a great market with solid cash flow and appreciation. If you're interested I'd like to connect you to my team so you can learn more about our market. Wish you the best!

 Hey Paul. So you work as a Real Estate Property Manager? 

[Paul Stamm]

I am an intern with a local real estate agent team here in Indy. If you would like to learn more about the market, I'd be happy to help you out!

[Bob Stevens]

Quote from @Michael Junior:

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

 Cleveland of course, 10% net caps are still to be had used to be 25% , based on cash purchases. I picked up 10 more doors over the last month all with 20% net caps

All the best 

[Joshua Janus]

Quote from @Michael Junior:

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

Columbus, Ohio is a great market to invest in. The population has been growing here year over year over the last decade, it is home to The Ohio State University which has over 50,000 students that live here along with those that visit, and it also holds a diverse range of young professionals and traveling nurses to fill the demand of the multiple business corporations and hospitals stationed here. The appreciation rate in Columbus has been 8% higher than the national average over the last year. Tech companies are continuously moving here and establishing a footprint in Columbus as well. Intel is a great example, who is building the largest chip manufacturing plant in the US right here, and it will be a $20 billion dollar investment that brings a few new thousand jobs.

https://www.dispatch.com/story/business/2022/01/21/intel-ohio-building-computer-chip-factories-licking-county-jersey-township/9173472002/

Another example of economic growth is the upcoming Ohio State University Wexner Medical Center Inpatient Hospital which is a 1.9million square foot hospital that will bring over 800 new beds and a thousand new jobs.

https://abc6onyourside.com/news/local/new-osu-hospital-expected-to-transform-health-care

Here are a few more recent investments

https://www.10tv.com/article/money/business/hydrogen-power-company-hyperion-bringing-700-jobs-to-columbus/530-25907aab-5517-4661-a9f3-d2ed2d5be6b0

https://news.wosu.org/news/2022-02-08/rumpke-to-build-50-million-recycling-facility-in-columbus

Check out The Complete Guide to the Columbus, Ohio Real Estate Market which goes through the Columbus, Ohio market in depth and will give you a better scope of where the highest levels of growth are taking place and where to look to invest.

[Account Closed]

Hi Michael, a quick google search of buzz words will send you right to the Midwest most times. And though many cities like Cleveland, Detroit, Dayton offer very strong cashflow, I like Columbus as a hybrid market that offers some of the same cashflow with strong appreciation as well. In the past two years we have seen a lot of large employers moving into Columbus, a city that ticks all the boxes of metrics- job growth, population growth, etc. Where in CT were you investing?

[Becca F.]

Quote from @Bob Stevens:

Quote from @Michael Junior:

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

 Cleveland of course, 10% net caps are still to be had used to be 25% , based on cash purchases. I picked up 10 more doors over the last month all with 20% net caps

All the best 

Bob are these 10% net caps on SFH, 2 to 4 units, or 5+ units? I have heard from other investors is that cap rates are not as useful with SFHs and duplexes but more so with apartment buildings. And that there aren't necessarily good or bad cap rates.

I'm getting 8% cash on cash return for my SFHs in Indiana. I'm looking also at qualitative factors: neighborhood quality, tenant quality, strength of local economy (diverse industries), growing or declining populations, appreciation rate, rent growth rate, etc. 

For example I looked at SFH to fix and flip but it was next to railroad tracks - that would be a no for me (looking at it as a potential buyer, as a renter, the noise would bother me). Also what else is building in that area, Starbucks or other coffee shops. Starbucks probably does a lot of research into where they're putting their stores in. I look at multiple factors besides cash flow, which lots of people are focused on.

[Bob Stevens]

Quote from @Becca F.:

Quote from @Bob Stevens:

Quote from @Michael Junior:

I recently moved from Connecticut to California. I own some units back in CT and sell Real Estate as a residential agent in both markets. 

I have not picked up any new units since 2021. And am looking to get back into buying pretty heavy. 

What I have learned in the year I have been in CA is I do not want to invest in long term rentals in this market. At least not right now. Cash flow does not seem to exist on small multi family. I do not want to invest for appreciation especially seeing as where the current prices are now. I just don't see them getting much higher in the near future. It's already extremely affordable as is in CA today. 

So im looking to invest out of state. Looking at some deals in CT where im from, but also looking to invest in other markets such as ohio, or indy. 

Curious to see what everyone who is investing OOS is looking at as far as markets go! 

 Cleveland of course, 10% net caps are still to be had used to be 25% , based on cash purchases. I picked up 10 more doors over the last month all with 20% net caps

All the best 

Bob are these 10% net caps on SFH, 2 to 4 units, or 5+ units? I have heard from other investors is that cap rates are not as useful with SFHs and duplexes but more so with apartment buildings. And that there aren't necessarily good or bad cap rates.

I'm getting 8% cash on cash return for my SFHs in Indiana. I'm looking also at qualitative factors: neighborhood quality, tenant quality, strength of local economy (diverse industries), growing or declining populations, appreciation rate, rent growth rate, etc. 

For example I looked at SFH to fix and flip but it was next to railroad tracks - that would be a no for me (looking at it as a potential buyer, as a renter, the noise would bother me). Also what else is building in that area, Starbucks or other coffee shops. Starbucks probably does a lot of research into where they're putting their stores in. I look at multiple factors besides cash flow, which lots of people are focused on.

 Hi not sure what you mean,, "cap rate not useful on SF and there  aren't good or bad" HMM  I believe you misunderstood that person. Cap rates are used on 1- 1k units, and yes there are good and bad cap rates. 

8% is ok, Also we would buy anything, ( to a point )  even near a RR track someone will live there, its ALL about PRICE NOT location as so many would indicate. So if someone can only afford for ex. 100k,but its near a RR track vs 130k away, well they really do not have a choice. I drive by places all the time and say, I would never live there, well people do, PRICE PRICE PRICE, :) 

All the best 

[Travis Biziorek]

Hey Michael, similar story here with me.

I moved to the Central Coast here in CA about a year ago. We were in Detroit Metro for 5 years before moving here. 

I have 12 doors there and it's still a great market. I'm finishing up a duplex there now and help other investors get started with my network. 

Happy to chat about that market if you're interested.

[Jake Andronico]

I'm certainly bias but extremely bullish on Reno, NV and some outskirts nearby.

Not many investors are talking about it. 

Proximity to CA, business/Tax friendly, world class Lake Tahoe right next door, skiing in the winter and the gorgeous lake nearby in the summer. 

Prices are certainly high but there are things that pop up that can do extremely well. 

Steady rent increases over time, as well as job growth. Tech, manufacturing, and logistics leading the way. 

https://www.edawn.org/home-pag....

Not for everyone, but strong appreciation, decent cash flow, and cheaper than CA.