OK, so I’ve been reading on here for months now (what an awesome forum!), time to begin taking some more concrete action in the new few weeks.
I want to begin choosing one or two areas here to begin scouring, visiting FSBOs etc…to look for SFHs. I know prices are still falling here but it can’t hurt to start investigating.
From what I’ve read here, I should go to REI club and ask other investors what area they like for rentals.
What other actions besides this should I take to choose my areas? I’m assuming comparing the typical rents from the newspaper vs. the recent sold prices of houses and doing the 1% - 2% cash flow rules is one thing, but what else? The other things I came up with are: avoid neighborhoods that are going downhill, and have a ton of “for rent” signs already. Do I need to worry about good schools? Thanks.
I just bought a four unit apartment building. What I liked about it was that it is in a neighborhood with mostly single family homes.
Good schools are never a bad thing. Though, I wouldn’t worry about it if you’re renting out single bedroom units or efficencies.
I look for-
separate utilities
low crime
close to stores
close to public transportation
off street parking for 2 cars per unit.
Sounds like you have been doing your homework (smile)
when I do visual demographics of areas I look for a few things
take what you like and leave the rest!
on market rentals
observe the type and age of cars parked in local driveways
( a special note> I always look to see what potential tenants are driving> but around here they are pretty slick and borrow a nice car when filling out apps> LOL)
the up keep of street homes> do they have newer siding . landscaping etc
if your looking at a unit and a neighbor pokes thier head out talk to them
see if you can find out if mostly owner occupied or rentals?
(I have an area in one of my towns that is full of SFH but mostly rentals!)
You already have >watching local papers for area rental costs
off street parking> garrage is a plus in my book
close to shopping etc
easy access to highways or commuting roads
Pull local Demographs on a site like Zillow they are not on the money but can be pretty close as to class and income of people living in a area.
I will say this if you can cash flow a SFH well the turn over rate is much lower than a Multi > however the cash flow is usualy lower as well.