All Forum Posts by: Lee Ripma

@Amin Bakhtiari

You'll never find the 1% rule in LA. Also the 1% rule is garbage as @Bruce Woodruff also pointed out. 

@Anshul Pandey

What about an analytical way to pick an out of state market? You’re really looking for B class areas in the path of progress. So is there a way to find those? Yes, I did this analysis for you so that you don’t need to spend the time trying to research areas. Briefly here is that methodology and the list. Feel free to DM me for a link to the complete article.

Filter for MSAs that have 150k plus people and are within 50 miles of a major airport (1M or more flights per year). 

Only look at zip codes that have a least 3k housing units (target rich environment) and a median home value of 100-250k. Rank by number of housing units that meet those criteria.

Here is the list by housing units. 

1. Houston, TX
2. San Antonio, TX
3. Las Vegas, NV
4. Philadelphia, PA
5. Indianapolis, IN
6. Jacksonville, FL
7. Phoenix, AZ
8. Tucson, AZ
9. Orlando, FL
10. Fort Worth, TX
11. Charlotte, NC
12. Minneapolis, MN
13. Columbus, OH
14. Miami, FL
15. Louisville, KY
16. Dallas, TX
17. Kansas City, MO
18. Oklahoma City, OK
19. Omaha, NE
20. Albuquerque, NM

Why not pick a few areas off this list and then find submarkets that work for you? That is what I did… I invest in Kansas City and it's a great market. 

Having a great PM and a great agent is key! I know you can be successful in any of these markets, so get going! 

@Owen Thornton

I vet the location first and the property second. Take a look at the report for this one. I won't buy if the population is declining. So vet locations! Note the subject in this report is your property and the Achor is a property that I own and would buy more of. 

@Jody Greenberg I personally would only use DIY because you can correct errors. My rule of thumb is 20-25% can be taken in Y1. Not tax or legal advice, consult professionals, just my personal opinion. 

@Stephanie Ro I always use the DISCERN method to look at neighborhoods. Feel free to DM me for my process. 

@Jody Greenberg

This is not tax or legal advice, just what I have personally done. I have used KBKG and DIY. I only use DIY now. Why? Because if you make an error you can email the owner and he'll fix it for you. Feel free to DM me for a discount code with DIY. I am personally a huge fan of algorithm-based cost seg studies on props under 1M. 

@Nicholas Heinrich - I'll send you what I use, paid but inexpensive. 

@Gopichand N. - I’ll DM you my process for finding and then vetting locations, quickly! 

@Justin Badillo

I think most of us would do what we are doing, maybe just on a smaller scale to start out. So for me that’s value add MF for my rentals. I think that new investors think the market is too hot to invest in. However you can still find deals with upside. 

How about 2 with a modification - you can invest out of state without going the TK route. By and large you overpay for SFH in crappy areas going TK (although not always). I personally like value add MF out of state. Stabilized at purchase with upside from cosmetic renovations.