Who'se investing in Gastonia?

14 Replies | Charlotte, North Carolina

I've been looking at Gastonia and have read a few investor stories with great results there.

I'm not sure why it has such a bad rap compared to Concord/ the areas to the East of Charlotte. Is there a specific issue there or more of a overall reputation?

I've been looking in Gastonia as well, but haven't seen many deals yet to be honest. I'm finding price/rent ratio to be very similar to the other areas you mentioned. I did find a potential foreclosure, but ARV isn't high enough there to make it worth the investment (i.e. purchase price probably around 45-50k, but needed 20k in rehab. Recent comps are max 75). It might have worked as a rental, but the rental prices are not as predictable as they are in CLT. My agent thought it could rent for 900 or so, but everything else around there is renting closer to 750. I will be curious what others have to say, as I'm a newbie to investing :)

@Kelly Carter

How are you determining rents.  Are you relying on your agent or using other methods.  Determining rents is something I am struggling with.  I have used rentometer but you only get a few free evaluations per month.  I may have to sign up for the paid subscription.  Wondering if you have found any alternatives.  

@Michael Baldinger For Charlotte I’ve been using my agent to send me closed rentals, but I’ve also been cross referencing that information with Zillow. I know it isn’t 100% accurate, but I’m able to enter the address and then check current available rentals as well as see estimates. It’s not perfect but it seems to actually match up fairly well with the closed rentals my agent has sent - in terms of neighborhood etc. I will say that for Gastonia it’s been more challenging, on zillow the numbers are all over the place with very little consistency - but that matches pretty well with home prices which are also all over the place, even on the same street. Because I’ve been focusing on 3 bd ranch’s style homes, it *looks* as though they rent closer to 1000-1050 in Gastonia as opposed to 1200ish in charlotte. Thus, the price/rent ratio isn’t hugely different. I’ve been told to ignore the 1% rule, but I’m sticking with it because it makes zero sense  to me to buy something that a) won’t cash flow well and b) is 30 years old and requires conservative repair and capex estimates. In fact I mean staying closer to the 2% rule unless it’s already been updated so major repairs won’t be an issue. The problem is, even in gastonia the 1% rule is tough to find via the mls. We are now thinking we need to develop off market deal flow or very distressed properties, but haven’t figured out a strategy yet. 

@Kelly Carter no not really.  You can just use other sites.  If you see a propert you really like just have your manager say how much it’ll rent for.  

I think there are really two factors at play- seems to lack a lot of job opportunity and is a far commute from Charlotte. This was at least my impression driving through the area. In addition, the fact it is the norm to have the ACs enclosed (as to not have copper wiring stolen) was a red flag for me.

It definitely works for some investors & they do well out there, however you’d really have to prove to me it was a good long term growing economy. I think a lot of people believe in Charlotte metro more since we’ve seen a lot of gentrification and upswing in home values, as well as business and development.

Originally posted by @Colleen McCann :

I think there are really two factors at play- seems to lack a lot of job opportunity and is a far commute from Charlotte. This was at least my impression driving through the area. In addition, the fact it is the norm to have the ACs enclosed (as to not have copper wiring stolen) was a red flag for me.

It definitely works for some investors & they do well out there, however you’d really have to prove to me it was a good long term growing economy. I think a lot of people believe in Charlotte metro more since we’ve seen a lot of gentrification and upswing in home values, as well as business and development.

Didn't know that about the AC units. That is a deal breaker for me. 

That tells me that area has a few more years to go before I would even consider it. Borderline war zone at that point. 

Originally posted by @Chris Ayers :
Originally posted by @Colleen McCann:

I think there are really two factors at play- seems to lack a lot of job opportunity and is a far commute from Charlotte. This was at least my impression driving through the area. In addition, the fact it is the norm to have the ACs enclosed (as to not have copper wiring stolen) was a red flag for me.

It definitely works for some investors & they do well out there, however you’d really have to prove to me it was a good long term growing economy. I think a lot of people believe in Charlotte metro more since we’ve seen a lot of gentrification and upswing in home values, as well as business and development.

Didn't know that about the AC units. That is a deal breaker for me. 

That tells me that area has a few more years to go before I would even consider it. Borderline war zone at that point. 

I understand your skepticism. But Gastonia is a weird dichotomy where part of it is white hot in the market currently because of Charlotte growth, and part of it is down right dangerous.

Try to find those areas that are in a transition period from C/D neighborhoods slowly turning into B neighborhoods. There are definitely deals available.

The problem is with Gastonia is this: (it's not the commute, because it's not far from the international airport, and you can be in Charlotte in the same amount of time it takes from Rock Hill or Lake Norman (two exploding areas)..) the problem with Gastonia is taxes and mismanagement of infrastructure funds. Gaston county has the highest taxes in the state, even more than Mecklenburg (Charlotte proper) and some of the worst schools, and inefficient government. Yes, it's gotten better, but mainly because the surrounding areas that have done a good job of trying to accomodate the massive growth in the region have gotten so expensive. You're better off investing in Kannapolis, or Waxhaw/Marvin area. These towns have focused heavily in defining themselves as towns, have low taxes, and you get a lot more for your money in those areas. 

Kannapolis has a totally revitalized town square, and a massive research park downtown that is establishing themselves as a medical research authority in the region with very low prices to accommodate investment.

Waxhaw has some of the best (if not the best) public schools in the Southeast. They teach Mandarin Chinese from Kindergarten through High School for example. I met an investor who moved from Scotland recently and chose Waxhaw over everywhere else in the country because of the economy of Charlotte and the public schools. 

My company works with a lot of investors (we manage their property) and the brokers that they use are our partners and this seems to be the sentiment across the board. Gaston is lagging. If you want to invest in that area Lincolnton would be a better bet because of the new Hwy 16, lower taxes, better schools, and not far from the West side of Lake Norman. 

That's just my .02

Personally, I think Gastonia, and the county, is ripe for long-term investment in some areas. For example, the Franklin Urban Sports & Entertainment (FUSE) project will likely raise surrounding property appeal (and values) significantly. Additionally, small town areas such as Lowell, Cramerton, Spencer Mountain and Mt. Holly are seeing growth and infrastructure development. They're following in the footsteps of success stores like Belmont. McAdenville is on an upswing in desirability with real estate prices coming close to peak already, especially those within a block or two of town center. I believe the folks moving into these areas will drive local and county governments to "shape up." With Charlotte rates climbing, displaced renters and even some land owners (displaced over rising tax burdens from rising values) are looking for more affordable housing within Charlotte commuting distance. That said, I believe Lincolnton is finally on the right revitalization track, and still a good bet for income property. But, flippers better hurry if they want a decent ROI. We bought a foreclosure about 5 blocks from town center around 5 years ago, and have seen a 200% increase in value on that property.