All Forum Posts by: Ali Mirabzadeh

Hey Ali,

Of course you can find deals wherever you go, but looking at historical trends. Denver seems like a more solid area than Phoenix. Especially if this market dip is coming...Phoenix was much more affected in '08 than Denver was. Denver also ranks better for metrics like education.

I ran them through my algorithm based on what you're looking for and Denver came out on top 👍

Welcome to BP Ali, 

As an Investor-Agent myself, I have had several conversations on this topic with my clients and customers. Everyone has different goals and investment criteria, so this is not a size fit all kind of situation.

I will suggest that you clearly define what you what and do some research then go from there.

A local Investor-Agent can help shorten your learning curve and save you a lot of headaches as they tend to understand the market better.

Hi @Ali Mirabzadeh, you are looking at two great markets and all the reasons you mentioned above is why you have seen so much capital flow into these areas over the past 5-10 years. 

I'm based in Denver and don't know AZ as well (side note*** I know a lot of people have moved to Phoenix/Scottsdale, but I don't get the appeal! It's a desert and cars/bicycles literally melt on the streets lol)

I think you are thinking about it well, especially looking at a long term approach, in a city like Denver that has good population growth, rent growth, average income, and vacancy rate like you mentioned is a still a great play if you are satisfied with just breaking even for a while, and seeing future profits/appreciation. 

What you also said is true, in Denver, it's hard to find cash flowing properties right now. The only other factor you many consider is incorporating a short term rental strategy combined with multifamily to see some healthy cash flow. There is for sure more work involved with that, but that is where people are seeing some good returns in our current market. 

The Phoenix market is very expensive, and very competitive. Expect to pay $350k+ per door and a pro-forma cap rate of 4% if you're buying in a desirable area.

It's my opinion that the rent growth we've seen around here is not sustainable even with heavy migration into the state, so I wouldn't be a multi-family buyer in the Phoenix market today. 6 months from now, that might be another story...

@Ali Mirabzadeh I would add that Denver is the bigger transportation hub which could be better for many reasons.

I like Phoenix for larger multis. We're doing apartment deals there because overall it has strong fundamentals and a lot of in-migration. Denver is going to have more snow to deal with, so be ready for that maintenance.

The downside is that they're both highly competitive for investors. Be sure to consider landlord friendliness, job growth, and new housing starts in your numbers.