Sharing a quick market analysis that I did

[Jessica Yuan]

Hey fellow out-of-state investors, 

I just got started with out-of-state investing and am actively reading books & learning market and deal analysis. 

As an exercise, I used the "Top 100 Cash Flow Markets 2024" from BiggerPockets. The goal is for me to downselect 5 markets to research. 

My criteria is 1) median home price <=200k, and 2) needs to have a decent population of >150k. 

Below is my analysis. The scatter plot has Rent YoY growth as X axis and Price YoY Growth as Y axis. The size of the datapoint tells you how big of a population each city has. 

But here're two questions that confused me, and I'm hoping to get some insights from folks here: 

1) Just for down-selection purpose, I think intuitively I should look for cities that are on the TOP RIGHT corner and avoid those on the BOTTOM LEFT. But these cities are really niche, I can't even find realtors to connect with on the Bigger Pockets websites for some cities, even though their numbers look great. 

2) The cities that have Rent to Price ratio >=0.7% has relatively lower rent growth and price growth. Why would that be the case? 

I appreciate anyone giving any insights and suggestions about my questions and my analysis. I'm also wondering if anyone has or is considering investing in any of these areas. 

Thank you all very much. 

[Corby Goade]

Here's a secret- the agents that you are fed on the agent finder tool here are just paying BP to have their name pop up. BP will take any agent who will pay them for that right, they don't vet them or interview them to make sure they will guide you or have any kind of experience at all. 

I'm not saying that you shouldn't use that tool, but I'm definitely saying that you shouldn't assume those agents have any type of clue what they are talking about. I know agents in my market who are paying to be on there and they don't own their own home, don't own any investments and some of them have literally never represented anyone in a transaction- zero experience of any kind. 

At a high level, you should be working with an agent who;

-Lives and invests in the same market you want to invest in.

-Does at least 25 transactions per year. 

-Is a full time real estate agent. 

-Well connected in their market to property managers, lenders and contractors in all trades. 

-Returns all inquiries within one day. 

There will defintely be good agents on the BP agent finder (I'm on there and I"m the BEST, lol)....but don't assume they understand anything about investing just because they're on BP.

I'm happy to help you find and vet an agent in the markets you are looking at if you like. 

Best of luck out there!