how do you know what is considered a good deal in Houston?
Hi BP!
I am new to REI and trying to educate myself as much as possible. Listening to different podcasts I hear a lot of investors buy property for under 100k, but I'm having difficulty finding properties around this ballpark. One strategy I really like is BRRRR, but how do you determine a good purchasing deal when it comes to multifamily/single-family properties? My market is Houston and I also try to take into consideration appreciation. btw if anyone wants to connect or willing to accept a mentee I am all for it! Thanks
Congrats on finding BP! If you are just getting started you may want to attend the BP webinar being hosted 8/5/20. It's also a good idea to check out the BP bookstore. As far as price is concerned, %100k may not be realistic for your market. Real estate investing is not one size fits all. The key is to understand your market and figure out how you can make money where you want to invest. In addition to this site and the podcast, BiggerPockets also has a YT channel you may find useful. Best of luck!
As @Rob Lee said, you have to know your market. But, you also need to spend some time figuring out your personal goals. Are you trying to make real estate a career? Looking to diversify your wealth for retirement? Once you've figured out your goals, you need to come up with your criteria. What kinds of investments will move you toward that goal? Only then can you determine if a deal will work for you.
Wow, what a great question.
A good deal is just a tad bit better than your next best alternative... which brings us to knowing the market, as others have stated.
In the process of learning what deals are out there (learning your market), I think you have to just get a feel for what is possible, what are the returns that you see other investors getting and over time you'll start to get a feel for what a reasonable 'hurdle rate' will be for your capital.
It is easy to see how important it is to network and get with other people that are doing what it is that you want to start doing.
Hi @Marcello Mack. I just posted this on another thread:
I invest in Houston and also manage for many other owners. Houston has many sub-markets with different strategies. If your goal is generating long term wealth then you need to buy and hold property. In terms of learning about the different markets it's simple but it takes time. Here are things you can do right now:
- -Add the Houston Business Journal to a reading app on your phone. Check headlines daily and read the articles that have development/economic impact. See where the path of progress is going.
- -Attend meetups (I have one online tonight) to network and learn what folks are doing
- -Select a zip code or two and set up an alert on the website of your choice. Start analyzing 3 bed 2 bath houses in that zip code and learn what a good deal is in today's market in your target zip.
If you do the hard work up front then you get better deals that will pay you for decades.
@Kevin Wood awesome advice Kevin, thank you so much! How can I attend your meetup?
If you click networking events above I'm in Houston. You can also search my company name on Facebook. Last you can look at my posts on my bigger pockets account. Mods don't like direct links unfortunately unless in the appropriate forum.