Been looking more seriously at Coeur d’Alene, Phoenix, Chicago, or Dallas lately?

Question

Has anyone here been looking more seriously at Coeur d’Alene, Phoenix, Chicago, or Dallas lately?

We’ve been seeing a ton of movement from out-of-state investors exploring these areas for different reasons — affordability, growth potential, and lifestyle plays.

Curious what other investors are seeing or hearing in these markets. What’s been catching your eye — cash flow, appreciation, or something else entirely?

Happy to trade notes and connect if anyone’s been active in these markets recently.

Melissa Justice · Answer

@Jeff Byers,

I’ve actually been seeing a lot of renewed interest in Phoenix, both from local and out-of-state investors. I’m a licensed agent here, and the market has been heating back up with strong population growth, steady job creation, and rents stabilizing after the post-COVID surge.

Investors are drawn to opportunities in the suburbs - places like Buckeye, Goodyear, and Queen Creek - where prices are still reasonable and long-term appreciation potential looks strong.

Happy to share what I’m seeing on the ground and connect if you’re seriously looking at Phoenix - it’s one of the few major metros that still checks both the growth and quality-of-life boxes.

Best of luck!

Ken M. · Answer

Are you new? Buying an "Off Market" property with "Subject To" and "Wraps" & Selling "Lease / Option"

When buying a property to cash flow, you need to know what your expenses are. The following is one I actually purchased in Phoenix that was a pre-foreclosure. The seller and I negotiated the terms. I did not offer a number to him, he told me what he needed. This first portion is the end result. The following portions are how we got there. Click on images to enlarge.

The house was not suitable for the MLS. The seller had waited too long to fix the problem and just wanted out. He said he needed $10,000 so he could move back to his home state. So, this is how we put the deal together.

First, you determine ARV (After Repair Value) so you can see if this one is actually worth buying. In this case it’s worth $245,00 fixed up.,(ARV).

You enter the Blue Numbers only, the rest are calculated. Enter the ARV (it's MLS value after it's all fixed up) on line 23, you get that number from looking at "comps". On line 24 you enter the payoff amount. We’ll take care of the arrears in a minute.

We always go through Escrow and Record, so we need to account for those costs. We Record because it’s the right thing to do and we want to know about any actions that come up against the property. Some people say don’t Record because of the Due On Sale clause, or to use a Land Trust to defeat the DOS which is bad information. If a lender wants to enforce a Due On Sale, a Land Trust violates the DOS anyway so it is ineffective in stopping the Due On Sale call.

Line 35 is always negotiable, but the seller needs enough to rent an apartment and move their belongs or they will become squatters which causes serious problems. There will be closing costs.

And of course, since this is a pre-foreclosure, the arrears have to be brought current.

Sometimes, a property will have a second loan or lien. Usually those can stay in place, but sometimes you have to pay those to buy the property. You can get the payoff amount from the lender. There is a specific process for doing that properly. If you are new, I would have someone help you with the process.

So, on this property, I paid line 37 $13,628 (which included $10,000 to the seller & closing costs $3,628), brought the loan current $10,597 line 48, took over the 2nd loan of $11,592 and took over the main mortgage of $118,145. I paid $153,862 and got a $245,000 property. But, I didn't need all $153,862, I only needed $24,225 to do so.

When you are new, looking for lenders & considering Fix & Flip, BRRRR, or rental, as a buyer, learn to ask the owner/seller to be one of your private lenders with creative financing. This works in Southern California (CA), AZ, WA, and GA & TX. Slight variations work elsewhere.

Aaron Zimmerman · Answer

Chicago has remained steady for appreciation despite the national headlines of declining. It's been a big bright spot with rent increases too. The primary driver is low supply. I live and invest in Chicago and it's a phenomenal market with a lot of diversity!

Martin Dempsey · Answer

The CAGRs are from July 2016 (starting data from realtor.com)... CAGR MLP is compound annual growth rate of the median listing price (appreciation)... 4BedCashFlowMonthlyLatest is using the realtor.com median listing price and the Housing and Urban Development "Fair Market Rent" (40-50% of observed rents) for a 4 bedroom living unit. CAGR Pop is Population growth. CAGR MHI is median household income growth. Mortgage Delinquency vs US is the difference between the percent of homes that are 30 to 90 days delinquent on mortgage subtracted from the percent of homes in delinquency nationwide... Landlord Favorability is a subjective rating 1 is worst for landlords vs. tenants and 5 is best. Nonjudicial foreclosures are binary (1 yes, 0 no). Climate risk is 1 to 10, the highest climate risk (of 6 or 7 factors) as determined by Pro-Publica in a recent article (with data for every county.) Best regards

Nate Garvey · Answer

I'm local to the Dallas area and looking for my first investment property, and it is tough here.  I'm on several wholesaling lists, checking Investor Lift daily, and the MLS.  From what I am seeing, anything that is close to a deal that actually pencils as a minimally cash-flowing (and I do mean MINIMAL cash flow) rental is snatched up immediately and usually at full asking price.

Bruce Lynn · Answer

The numbers in DFW/Dallas area are that about 30% of the homes purchased are by investors.

I believe that.

Vincent Zhu · Answer

@Bruce Lynn one of my friend told me the below numbers for Dallas. For a 400k rental house, the property tax is 8k per year and insurance is another 4k. While for the same price I Phoenix area, these two numbers are like 3k and 1k. And the rent seems to be the same of 2k per month. Looking at these numbers, I don't see a reason why I should invest in Dallas. Anyone has better idea on this?

Jeff Byers · Answer

That sounds right.

Been looking more seriously at Coeur d’Alene, Phoenix, Chicago, or Dallas lately?

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