All Forum Posts by: Sunny Chen

Hi @Sunny Chen,

Indiana is a great market for steady cash flow, but if you’re looking for stronger appreciation and diversification, exploring out-of-state options makes sense. Texas still has solid growth potential, particularly in cities like Austin and Dallas, but prices have risen, so returns may vary. Consider emerging Sunbelt markets like Phoenix, Tampa, or parts of North Carolina (like Raleigh or Charlotte) that continue to see high migration and job growth, driving both appreciation and rental demand. Diversifying into a high-growth market could balance out your Indiana portfolio nicely.

Hi Sunny,

I expect DFW and Indianapolis to be similar to as you describe, although $250,000 price point can be tough on newer homes less than 10 years old.  I am starting to see some homes though in that price range.  Typically I am seeing investors put down 30-40% to break even or cash flow a bit, so that is about the same as your 80% coverage ratio. 

Growth prospects still look strong to me in DFW area.  Many of the big announcements haven't been completed yet or still under construction.  BofA, Wells Fargo, Goldman Sachs, TI plants, Global Wafers plant, etc.  There are also still a lot of projects in the talks stage, for example some people whispering that DFW will become the electric car capital of the world.  Also the Adelson family of Las Vegas Sands fame have purchased a couple of big parcels with hopes to build a giant casino/convention resort perhaps anchored by the arena for the Mavericks for which they also just purchased majority ownership from Mark Cuban.  Add a very diversified economy here with banking, insurance, oil and gas, education, three medical schools, 3 law schools, life sciences, DFW airport, and so much more, it looks like the growth just goes on and on.

As far as appreciation goes, that's always tough to predict.  While we saw some big jumps around covid times, it has now slowed as I expect is the same for your current area if not most of the country.   However, if you remember the presidential candidate from years ago who was Dallas based, Ross Perot, he said, if you want to make a billion dollars in real estate, buy in the path of progress.  He practiced that well and his son is now one of the largest developers in the country, if not the world.

The nice thing for investors is that there should be a 2-3 or maybe 4 year gap in major apartment developments coming online.  There are some other dynamics that also will likely play a factor in making the situation great for investors...such as runup in home prices and interest rates probably created a permanent renter class of society.  I think I saw a stat last week that said 40% of DFW renters are now paying 50% of their salary in rent.  That will make it near impossible for most of those people to buy any time soon.

@Sunny Chen

The best way to find mentors in your area is to attend local meetups. Ask to tag along on an ongoing project. You'd be surprised how many investors are receptive to that.