I recently began purchasing OOS properties in
higher cash flow areas professionally managed by a local team.
All that being said, I'm happy to be called a slumlord if the label continues to scare away people from
the highest cash flowing areas where I like to invest.
I think making $ 500,000 to $ 600,000 in equity appreciation in my 9 properties in the last 3 years with properties in
high cash flow areas like texas, Indianapolis, chicago etc...
Not exact matches
In the dying prairie town of Howard, South Dakota, young people in a
high school business class conducted a
cash -
flow analysis of the local population's buying habits; it sparked a community - revitalization project, raising local spending by 27 percent and attracting new business initiatives to the
area.
Some of you reading may be in
areas where the cost to buy a house is four times as
high and the rents don't come close to
cash flowing.
All indications point to the pricing in the
area being too
high, and that doesn't seem like the right situation for a new college graduate looking for
cash flow.
A very interesting discussion thread, and while it is true that you will be hard pressed to find a positive
cash flowing (or
high cap rate) investment in the NOVA
area, I found that buy and hold to be an effective investment strategy for this
area.
However it is cheap and has
high cash flow for a reason - not everyone has the stomach or cajones to do business in these
areas.
Most of my RE investments have been in a
high appreciation
area that provides minimal
cash flow (compared to Midwest locales) upon purchase.
Such measures have unintended consequences though, and these include diminishing the value (in terms of
cash flow) of investment properties, reducing the pool of buyers in
high - demand
areas, and possible infringement of property rights.
Furthermore, there are certain
areas of my market where I know taxes are much
higher and therefore even the 1 % rule doesn't work... it usually has to be a 1.5 % - 2 % property to offset the
high taxes and still
cash flow.
However, we invest in Waterloo, Iowa which is a low to middle income
area and our strategy is based on the
highest cash flow possible, but we know our properties are not going to appreciate much.
First, we have a number of markets that have low cost (not garbage
areas), low tax, and
high rent... can you say easy
cash flow?
All acquisitions were buy and holds of two types:
high cash flowing in locations that experienced light to moderate property appreciation; and
cash flowing in
areas that experienced a
high rate of appreciation where major profits were made on the back, at the time of refinancing.
The biggest problem with both
areas is that the price is so
high that we can not find any rental property with positive
cash flow; you can only count on price appreciation.
And yes I regularly show
high cash flow in this
area.
Make sure the property has been rehabbed to turnkey quality that will maximize your
cash flow (roof and HVAC updated, ceramic tile it kitchen and bath, vinyl plank hardwood in
high traffics
areas, durable carpet installed in bedrooms, external fences and buildings addressed during the rehab, supply hoses replaced under the sinks, etc) otherwise your
cash flow will go to maintenance