All Forum Posts by: Lindsay Davis

@Brayden Sodestrom,

Welcome to BiggerPockets—it’s awesome that you’re getting a head start at such a young age. At your stage in life, I’d recommend taking the time to familiarize yourself with a few target markets.

Know the areas you want to invest in like the back of your hand, develop a due diligence checklist, and go through the exercise of evaluating deals (even if you’re not looking to buy a property yet).

If you put in a bunch of reps before going through your first live deal, you’re far more likely to know what to look for—and what to avoid—when it comes time to buy.

@Sonya Dean,

Welcome to BiggerPockets!

I see that you’re in Atlanta—not too far from where I’m at. I’m active as an investor, broker, and turnkey operator in north Georgia, in addition to Alabama and Tennessee. Happy to serve as a resource if you have any questions!

@Marian Turcus,

The best way to start, in my experience, is to get your hands dirty. Evaluate deals conservatively, pick a growing market, and a state with landlord-friendly laws. Then, use that to identify a small, low-cost deal.

Make sure you’re clear upfront about your business plan and how you plan to make money: are you looking to force appreciation through renovations, increase cash flow through superior property management, or do a simple buy-and-hold.

Also be clear about how much time and money you’re willing to put in. You list house hacking and flipping—both are doable, but they’re very different approaches that demand different levels of investment and time.

Finally, be choosy about your market. If you’re moving to Colorado and want to invest there out of convenience, that may work out, but sometimes the markets that work best for your style or strategy aren’t where you live.

@Mel Rosario,

Are you partial to those three states? I’m sure you know all too well that California homes are expensive, especially in good school districts, and so I ask because it looks like your current bottleneck is the high down payment and purchase price.

I also imagine that you’re already managing your NV and AZ properties remotely and/or with the help of a property manager. Given this, and given that you’re following a turnkey, buy-and-hold strategy, have you considered lower cost geographies with similar tailwinds (Class A properties in neighborhoods with good schools, etc.)?

For example, places out in the Sunbelt like Huntsville or Chattanooga could potentially fit the bill, and investments there could immediately halve your purchase price and down payment. Just some food for thought!

@Oswaldo Zamora,

@Dani Beit-Or already pitched Birmingham, but that’s certainly not the only city in the state that can potentially meet the 1% rule and offer appreciation at the same time.

A great place for a mix of both, in my opinion, is Huntsville—especially the suburbs and towns surrounding it. Little-known areas in northern Alabama like Arab (30 miles south of downtown Huntsville) and Cullman (about 55 miles southwest of Huntsville) have deals that meet the 1% rule.

Plus, both markets feature growing populations, which is a tailwind for long-term appreciation.

@Blake Doersch,

Sounds like you’ve given a lot of thought to real estate investing, which is a good start. Also sounds like you’re considering a lot of different strategies, each of which have vastly different capital and time commitment requirements.

My recommendation would be to sit down and establish a “buy box.” This is a tool investors use to identify the type of deals they’re after based on their qualitative (location, property class, vintage, use/function, etc.) and quantitative (financial) characteristics.

For example, how much capital do you have for each deal? What markets are you willing to buy in? What sort of tenants are you looking to take on (e.g. Section 8, cash-paying, short-term/vacation renters, etc.)?

@Weston Rutkowski,

You have an awesome background. Congrats on getting started and welcome to BiggerPockets!

I saw in one of your replies that you were open to cash flow markets. Full disclosure: I operate a turnkey provider in Alabama and, from my observation, plenty of areas in the state are positioned well for cash flow, including Birmingham, Montgomery, and Tuscaloosa.

One thing I would like to point out is that short-term rentals are time-consuming and, unless you have a customer service and on-demand cleaning team built up, it’s fairly difficult to scale. Cash flow can also be more volatile as well, since you might make a lot during peak season but barely break even in other months.

If you have a good amount of capital to deploy and are interested in scaling, a traditional long-term rental approach with single-family homes—either self-managed or managed by a turnkey provider—could be a more suitable alternative.

@Victor N.,

Insuring for the full replacement cost would be best, in my opinion, since this is your first deal. If you’re willing to be a little more aggressive, then maybe you can opt for actual cash value. The former still seems like the better of the two approaches since you’re buying a new construction home.

@Nicholas Marchionda,

If you do everything right in terms of marketing, pricing, curb appeal, and customer service, you can generally expect to have your property leased in about two to six weeks.

For marketing, make sure that your listing is active, visible, and cross-listed on all the major real estate marketplaces: Zillow, Realtor.com, Apartments.com, Zumper, and Trulia. Throw in Craigslist in there too, if you want—though be aware of scammers.

In terms of pricing, make sure your asking rent is competitive with comparable listings. You don’t want to lowball yourself, but a listing that’s priced too aggressively will likely sit on the market with little interest. As for curb appeal, make your rental attractive to look at and tour. Take professional photos, pay for physical or virtual staging, and freshen up your lawn and exterior.

Above all, don’t forget to respond promptly and courteously to everyone who reaches out to you. Any of them could be your next tenant!

@Tammy Lewis,

@Kerlous Tadres has some good recommendations. I’d personally say, though, that sub-$200,000 deals in Huntsville proper are probably behind us. However, if you’re willing to consider nearby areas—including places like Arab (30 miles south of downtown Huntsville) and Cullman, located 55 miles south of downtown Huntsville—you can find deals that are well below $200,000.

Another bonus: Cullman’s growing a lot at the moment, so that could be a potential tailwind for rents growing froward.