Hey fam! My name is Austin Stout, new to the forum. I'm looking for some input on my current situation with getting started in multifamily. I'm not sure about the long-term economy of my hometown, Price Utah.
The biggest and most reliable employment in Price is with education as we have a branch of USU in town and various grade schools.
There are less than 9k people in town with not much job growth.
According to some info I found online, 35% of the properties are rented vs owned
Median home value- 179k Median market price- 132k. (values have went up 5.5% over the last year according to zillow.com
I have been researching St George Ut, and Cedar City UT as well but I'm not sure how feasible it would be to start out living 4-5 hours away from my properties. (sounds tough)
I live at home with my parents and have saved up a bit of cash to help get started. That being said, I will be needing my own place soon as well.
Should I get started here in town providing I find a deal where the numbers make sense? (Hopefully, live in one unit and rent the others) or go to a bigger city with a more reliable economy and more property options?
I would really appreciate any insight!
Thank you for your time!
We've been happy with cedar. We started buying properties in cedar when we lived in Ephraim, about 2.5 hours away. It is kind of rough, but who doesn't enjoy a tax deductible trip to southern Utah 1 or 2 times a month??
We eventually moved here 2 years ago. And to be honest, it seemed easier when I didn't live so close. When we lived further away I hired more things out (cleaning, yard care, small repairs)
I have a great prop manager lined up for when I'm ready to fire myself from managing.
I wanted to invest in Ephraim when we lived there (half the size of Price) -- husband thought it was too small a market. But so many people rent -- I think it would have been ok especially bc we lived there.
Good luck!!! St George is an awesome market if you can get in at the right price. We have one place there and it does quite well.
Btw when we were looking at properties in Ephraim, nearly ALL the owners lived in Salt Lake, Provo, Stg, Vegas--- rarely did we find an investor who owned and lived in Ephraim. Just a thought--
Living near your investments is totally great because of the overall convenience. Like @Alison Kovac said, and I totally agree... Living far away is ok also because you learn to set up a team and treat it like a business and not a hobby.
St. George is really not that far away. You will have a hard time finding anything that the numbers work with (referring to the 1% rule.) in Cedar City or St. George right now.
We have found that the cash flow is better in the rural Utah towns but there are drawbacks like unemployment and potentially rougher tenant.
I have sold my rentals and rolled things into Vacation rentals... I like the tenants more, I like the properties more and the cash flow is better. But is does require more management day to day.
Shout out to my small town investors! I grew up in Manti and am a Snow College grad! I am finding the numbers to work better in the small towns as well. One of the challenges I am facing is finding a good property manager in those small towns. I think that Price and Emery county is a great market for single family rentals. There are lots of working class people who have steady jobs that may not want to buy. I'm not an expert, but I think that the future is bright for Emery County . There are lots of natural resources that still have a long life. That's just my two cents. Find the right deal and make it happen!
Investing far away (out of state) only makes sense when the numbers are much better there then locally.
I can buy a 250k home here that rents for 1700 (okay numbers) or I can buy a 50k home that rents for 800. I’d rather do that, hence out of state
Hey Austin, I'm in the same boat. New guy, wondering if I should invest out of the area. It's very likely I'll have to invest 1 to 2 hours outside my area (DMV) because houses are too expensive here. I will pursue creative financing options if I find a good deal locally before going out of the area. Good luck friend.
@Rich Miami - DMV is expensive but I'm trying to find my way down to Baltimore and see what the prospects are out there. I like what Morris Invest on Youtube is doing. Check him out Champ!!
@Alison Kovac @Justin Morgan
Very good points about the out of area properties and how it makes you get a team together to handle business. I'm not looking for another hobby so regardless I'll need to find reliable people. I never thought about it that way! My buddy had 8 units locally but got burned out because he tried to do everything himself from the management to repairs. I have looked a little more into cedar city than St George and it does look like finding a deal that meets the 1% rule will be tougher than the smaller rural areas.
Do rent out single family homes in St George for vacations? That actually sounds like a pretty cool idea and more enjoyable people to work with would be nice.
@Jaiden Olsen I don't know any property management companies in Price but I know of a reliable plumbing guy and handyman/repair guy if you need someone!
@Rich Miami Right on man! Cool to hear from other young guys trying to get started in this game! Good luck to you as well!
@Lamont Marable Be careful encouraging others to use "Morris Invest" if you do a search here on BP you'll see hundreds of posts of investors who have been scammed and lost thousands of dollars using them.
I would avoid them at all cost and always do additional research when getting recommendations or seeing a t.v host face on YouTube selling 40k homes.
@Austin Stout the vacation rental space is very limited in St. George due to city ordinances. My properties are rural recreation areas and north of $1million to attract the bigger families and higher $$$. I do have a $75k condo in Brianhead and it does NOT pay for itself (bad snow year, bummer deal, maybe this year it will).
Seems like a few others agree that the small towns have good starting cash flow for SFR rentals. Like anything, you have to find good people.
@Austin Stout , I agree with @Justin Morgan , St. George is strict in the vacation rental area. Hurricane/La Verkin/Virgin historically have been much more flexible but those ordinances have changed over the years so you have to be careful before banking on being able to do vacation rentals. The cities often have hefty fines for illegal vacation rentals and they do monitor that market. Also be cautious of your if your property is in an HOA. The HOA's often do not allow nightly rentals and their fines can be steeper than the city fine. Even though the market is up there are deals that sneak through.
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