Small Town Vs. Big City Investing?

Question

Investing in a small town in Iowa vs the big city...what is your experience?

From what I have heard, if you are investing in a smaller rural town in Iowa, you can expect higher cash flow but a smaller appreciation. If you are investing in or around the Des Moines metro, typically you will see greater appreciation but lighter cash flow. There are a lot of variables to consider, but this has been the general consensus from the investors I have been having conversations with. I own a duplex in Des Moines and can agree with those statements.

I want to hear everyone else thoughts...has this been your experience with your real estate investments in Iowa??

Gabriel Kinser · Answer

Great question Andy, I only own in Des Moines but have talked with other more rural landlords and I'd have to agree. The best investments imo are when you can find the exceptions that have both. For example, finding high cash flow in Des Moines by being willing to deal with problem tenants and problem properties/areas. Or, conversely, finding rural areas likely to become suburbanized like Cumming/Martensdale/Van Meter/Winterset where you can buy at rural prices and get rural cash flow but if you hold 10 years you also get the big city/suburban appreciation rates.

Jared Hottle · Answer

Hello Andy, I am in Northeast Iowa and invest in the bigger cities as well as smaller. I love small towns. Rent are still pretty high as rentals are limited in those towns, the schools are great and other things attract people to small towns. Taxes are lower, less government oversight, etc. To your point I do believe the appreciation is lower but Iowa as a whole is pretty low and much more of a Midwest cash-flow state.

Eliott Elias · Answer

I can give you a example in Texas, I invest in Killeen Texas, an hour north of Austin. There is cash flow, but appreciation is terrible. It takes a lot more deals to make the type of money you would flipping in a strong market like Austin.

Lucas Gillmore · Answer

Generally I agree with exemptions being Iowa City and Ames there you get minimal appreciation and minimal cash flow.

Small Town Vs. Big City Investing?

Most Popular Reply