I am newbie investor looking into Indianapolis turnkey properties and was hoping for some feedback on the location of the turnkey. I have looked at several turnkey properties online and I was wondering if the distance to the center of the Indianapolis was a concern.
I am currently searching for 110-140K properties in B+ or better neighborhoods, preferably in a newer development, (cookie cutter house)
Are towns like, McCordsville (30 min commute) & Muncie (60 min commute), outside the 465 Loop safe investments for the long term? I started to have concerns when I read a post regarding "Anderson" township in Indianapolis where housing demand fell greatly due to large company leaving the town. Would choosing a town closer to the Indianapolis downtown a safer choice? I am assuming most of the jobs are near the indianapolis main hub but I am not sure.
Thank you in advance.
Greenwood is a town just south of Indy that is fantastic for rentals. Noblesville to the north is a good one for rentals in your price range as well. Woodruff Place neighborhood in east Indy is great for rentals in that range but be careful. That area is up and coming but there are still plenty of bad spots there. The closer to 10th street there the better. Stay west of Rural St as well. Fountain Square is arguably Indy's best neighborhood for investors but its hard to get anything there turnkey for the price range you are looking in. Bates-Hendricks is another good one but getting to be a little pricey as well. There are still deals to be found there though. I just sold 2 turnkeys there on Terrace Ave for 140K. They could have used some cosmetic updates but were both solid, clean, and up to code. Irvington and Speedway west of the race track are a couple other good rental neighborhoods that come to mind.
Muncie is a little far for the "Indianapolis" market, but it is a college town and probably a considerable market. As far as Indy suburbs go:
The northside suburbs are typically going to be difficult to find decent pricing, but if you can get a price that makes sense, they are likely the most desirable places to be. They are:
There are some smaller markets outside of those towns that you can find deals that are very good though, these would be:
My next favorites would be West side suburbs or Southside suburbs. The Westside suburbs are
Plainfield is very established already, but Brownsburg and Avon are both in high development mode. I steer a lot of my clients looking for B Class assets towards Brownsburg/Avon.
The Southside suburbs are
- New Whiteland
Greenwood is the most established. The more desirable area of Greenwood will be White River Township, which will be Center Grove School System, but it will be almost as tough to find a well priced deal here as it is in the northside suburbs. It is still developing where as Old Greenwood is already very established. New Whiteland and Whiteland are growing quite a bit as well. I prefer the Brownsburg/Avon markets to the Whiteland area, but I wouldn't pass on a decent deal there.
There is not much to talk about out East, but there is
- New Palestine
These are developing, but more slowly.
My picks would be:
- Greenwood (White River Township)
- New Whiteland
Hope that helps to give you some insight.
McCordsville is not a rental area. There is a huge % of home ownership. Places like Muncie - I don't think there's that much daily commute between Indy and Muncie.
@Jay Zoo Those areas are quite a distance from Indianapolis so I don't think you're going to attract a tenant pool that works in Indy. You're going to need to evaluate them on the basis of their own employment base and anything else that attracts people. Muncie has Ball State which makes it a good college town. Both of these areas are too small and isolated from the Indianapolis Metropolitan area in my opinion. I would look at some of the areas the @Ross Denman has already mentioned, however, you can do very will right in Indianapolis and get much better returns. We've been operating in Indy for several years so I know it well. Feel free to reach out if you'd like some insight.
@Jay Zoo I disagree with @Ritch Bonisa on this one. With your price point you will bring exactly what is missing from the McCordsville area. American Homes for Rent would be your main competition but I get calls all the time for people looking for homes to rent in McCordsville. Lawrence township higher end homes continually creep east towards the county line and people are realizing very quickly that Mt. Vernon schools are much better.
Yep, I live in the district. Taught there, and own a business in McCordsville. Know the area very well.
@Michael Lewis Thank you for your reply and valuable info! Do you sell turnkeys???
@Ross Denman Thank you for the wealth of information. I will start mapping/organize out the detailed town information!
@Ritch Bonisa Thank you for your reply! In regards to high % of Home ownership rates and I had few questions. Usually, B+/A neighborhoods have higher home ownership rates therefore it is a more stable market with slightly higher appreciation rates? I understand that ROI will be typically lower. Or is it that McCordsville's home ownershipment rate is extremely high and there isn't much rental demand at all?
@Mike D'Arrigo Thank you for your reply! I will be in touch shortly!
@Michael Thompson Thank you for your reply! Is the vacancy rates higher for smaller/remote towns?
@Jay Zoo - No not really. Think about a couple of things. The first is McCordsville is right off Pendleton Pike and is an 4 minute drive to Oaklandon shopping area, in Indianapolis, with plenty of employment opportunity for renters. Secondly, the deals are hard to come by so that is the most limiting factor. To the point of @Ritch Bonisa they are mostly home owners which means buying at the top of retail prices unless you can find an off market deal. Good luck!
Hello All, any insight to share on Eagledale (north of the speedway)? I’m flying to Indi tomorrow to look for properties and they are going to show me houses in that area (60-70k aprox). This would be my first rental investment and I’m lost on where to focus my search on Indianapolis. Thanks!
@Agustín Schuster We manage quite a few homes in the Eagledale area. Eagledale is a fair area to purchase investment properties, but because it is IPS schools, so most of these homes are investment properties as opposed to owner occupied properties. While this is not a huge issue, it does impact the appreciation and the ability to sell if you decide to exit in the future, it will probably purchased by another investor.
Heavy investment markets appreciate more slowly as there is a limited retail market driving the prices and desirability up. You can certainly buy decent properties that will cash flow well if you purchase at the right price in these areas, but in the long term, your IRR will be higher in areas with a higher percentage of home ownership. If you are looking for strictly cash flow and COC ROI, Eagledale is one of my favorite areas for my clients to park their money, although I prefer higher class assets. It really comes down to goals and resources. One caveat is that most of these homes were built in the 1960's and 1970's and used clay tile sewer lines. More and more of these sewer lines are having to be excavated and replaced with PVC each year. I would certainly do research to find out if this has been done at any property that you may be interested in. The cost to replace these sewer lines usually range from $2,500-$5,000 depending on the amount of work to be done. This is common with any area in Indianapolis where the homes were built before 1980, so it's not exclusive to Eagledale, but it is a common occurance there.
Let me know if you have any questions on contractors or anything like that.
My husband and I have two rental properties available now. The first is in 46219 (high rental area) and has just been rehabbed and move in ready. The asking price is 99k, ARV 128k.
The other Noblesville property that we have would require a rehab to bring it up to date but it has good bones. Purchase Price: 47k, ARV: 1401k
I myself am looking at properties in Sheridan, IN. Can anyone comment on the location, etc? Would appreciate your thoughts/feedback.
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