All Forum Posts by: Neil G.

@Whittany Gibson so tell us how it went! Did you take the leap? 

@Andrew Cummings i've been looking for the same thing in Tampa. It's very hard to find what you are looking for. Seems to me that most places I would want to live (neighborhoods one might consider "cool") already have prices over $300/sqft. And places that meet the 1% rule for revenue vs purchase price are in neighborhoods that I wouldn't want to live. I suppose it depends on the sacrifices you're willing to make on either the cashflow side or the location side. Or maybe you can get lucky! Best of luck!

Thanks for the tips @Mark Gliebe. I think a road trip is in order!

@Levi Bennett great high level perspective. Yes, the more I dig into this home search, the more I'm learning about the overall housing market, Florida's economic history and its unique position in the market. And I'm definitely hearing chirping from both sides of the aisle when it comes to downturn or no downturn. Speaking from zero experience and only superficial knowledge of the housing market, I'm feeling that there may be a slowdown, but I don't see the oversupply or crazy lending practices that preceded 2007 crash. I do see tons of cash investors and retirees... Anyways, I suppose I could hedge my risk by investing periodically. Like long term stock investing. As long as I can keep my income up (currently unrelated to RE), I could ride out ups and downs in the market cycle by buying every year or so and focusing on buy and hold. I just really want to hit a home run on my first deal. I'm sure you know the feeling!

Touche', Ryan. I'll consider this. By the way, what made you shift your target market from Tampa to Raleigh? 

@Ryan Groff thanks for your insight. It's just hard to wrap my head around the fact that an $80,000 house in 2014 could potentially be worth nearly half a million dollars in 2025. Because I've been consistently seeing 300%+ appreciation in almost all of the hot neighborhoods of Tampa in the past 5-7 years of sale history (most likely they were improved too). So it feels like a risk for my first home purchase.

For high growth cities like this, would you say the trick is to get into a part of town that simply hasn't seen that type of gentrification/development yet?

Hey BP folks! I've been planning a move to the USA and have been laser focused on Tampa, FL, and am seeing overinflated RE prices there. Houses that were selling for $80,000 5-8 years ago are now selling for $350,000 or more. I'm now wondering what other up-and-coming cities I might consider that are still flying under the radar in the SE. Lower cost of living/home prices, growing population, liberal/hipster movement, healthy population, coffee shops, interesting bar scene, close to nature, etc. Basically, I'm looking to live and invest in the next Austin, Nashville or Denver! A couple of places that have popped up in my initial research are Raleigh, Memphis, San Antonio and Louisville. What cities do you recommend?

@Michael Heisterkamp no worries. This has been helpful. So basically, it all goes back to NOI, potential NOI and market cap rate 🙌

@Immanuel Sibero @Michael Heisterkamp one thing your explanations still differ on is the idea that you can increase the value of the property to decrease the cap rate. Anyone care to clarify this discrepancy?

@Michael Heisterkamp and @Isaac S. Thank you for these examples. It seems that there are some silent cap rate factors at play here that people are forgetting . Inflation and interest rates. This an exciting puzzle

@Michael Heisterkamp still trying to wrap my head around your third example. Need to ruminate on this one a bit more.

@Immanuel Sibero thank for this brain-relieving lesson. So this means that in any given neighborhood, there is a prevailing cap rate that the investor has no control over. And correct me if I am wrong, but the property neighboring my own property will have the same cap rate as mine. And these are the only things that can be done to change the value of the property:

1. Hope market conditions change (improve) in the neighborhood, in which case buyers would be willing to pay a premium for that NOI in that area, hence value goes up.

2. Increase revenues and/or decreasing expenses, causing NOI to increase and subsequently, the value to increase.

3. Creating POTENTIAL for increased revenue in the future, i.e. building add ons and improvements that result in a market value increase

Am I missing anything?