Some friends and I are looking to start an LLC to begin investing in rental properties. We're from Los Angeles and just getting started. That being said, it's been difficult to prioritize cash flow and find any deals given California housing market prices. We've decided to start looking in out-of-state markets and have identified the general Las Vegas area as potential market we'd like to invest in. We'd like to find some properties to purchase under $150k. Does anyone have any general advice for regions and cities outside of the traditional Las Vegas area? (Places like Henderson and Spring Valley seem to be a little too expensive given our price point.) We're a little weary about purchasing houses that need a lot of rehab given that we live out of state. Any advice is extremely appreciated.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
5y
I think you'd be lucky to find anything in regards to a SFR under $200k in the valley and you'd probably have 1 day to buy it before they received multiple offers. You might find a condo but then you have to be wary of HOA rules and fees. I really wouldn't consider anything outside the valley (pahrump Indian Springs, etc.)
I would suggest Arizona but it’s probably the same story.
If you’re going to partner with more than 1 person I would look at $300k+ properties. Splitting a cheap property 3 ways may have little risk but it’s going to have microscopic returns.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
5y
I think you'd be lucky to find anything in regards to a SFR under $200k in the valley and you'd probably have 1 day to buy it before they received multiple offers. You might find a condo but then you have to be wary of HOA rules and fees. I really wouldn't consider anything outside the valley (pahrump Indian Springs, etc.)
I would suggest Arizona but it’s probably the same story.
If you’re going to partner with more than 1 person I would look at $300k+ properties. Splitting a cheap property 3 ways may have little risk but it’s going to have microscopic returns.
Hi Erick, I would recommend writing down a list of criteria with your partners. e.g. population, population growth, capital city, college town, etc. From there, you can create a list of MSAs that meet those criteria. This might help you narrow down your search area.
Real Estate Agent · Henderson, NV · Member since 2011 · 1k+ posts · 550 votes
5y
@Erick Daniel Alvarez At that price point, you're mostly looking at 1 bedroom condo units. You can push rent if you update everything, but that gets into a territory that you're trying to shy away from.
You're at least a $100k shy of getting into single family product.
Las Vegas, NV · Member since 2019 · 173 posts · 78 votes
5y
@Erick Daniel Alvarez has your team done any investing to this point or would this be where you start? I'm new in Vegas and looking to work with others and can be the "boots on the ground" for a good team.
Las Vegas, NV · Member since 2019 · 12 posts · 9 votes
5y
As others have stated, you're not going to find anything in Vegas for under $150k; maybe if you find really great wholesaler, but I still doubt it. Maybe a very small 1bdr Condo is possible, but the cashflow from that isn't going to be worth splitting with a group of friends in my opinion. You might want to look a lot further east like Dayton, OH, Memphis TN, Cleveland, Detroit, etc. Look at markets where property is a lot cheaper, but the rents are still between 800-1k because these areas will get you the cashflow you're looking for. I understand Vegas is ideal because it's right next door to Cali, but you're gonna need to more than double what you'd like to purchase something for.
Rental Property Investor · Lebanon, OH · Member since 2016 · 220 posts · 228 votes
5y
@Erick Daniel Alvarez, I agree with Josha Hardy and I can speak from experience, places like Dayton, OH are great places to invest for cash flow. You just have to make sure you have a good, local team in place.