Ever heard of the web site Bigger Pockets?
It’s a great site full of useful information for both new and experienced real estate investors. From simple, basic investment strategies and education to more sophisticated methods for the experienced investor, odds are you can find an article there that will be useful to your real estate investment career.
What you may not find there, however, is local market data that is specific to what your real estate goals and tolerances are.
For example, you may find someone who swears you can get a certain rate of return in your city. And while that may well be true, it might be in a neighborhood you either know nothing about, or one that may not be geographically convenient for you or even a place you’d like to invest.
You may also find that what’s true in Dalhart, Texas, isn’t what’s true in Minneapolis, Minn.
First, laws may differ between states, counties, and even cities. Second, one may have lower levels of unemployment than the other, which drives demand for housing, increases rents and the cost of acquiring rental property, and makes higher rates of return more challenging to realize.
Finally, it is the Internet. Sometimes people will tell you only part of the story. For example, someone may tell you they are able to purchase real estate in a hot part of a city at deep discounts. What they won’t tell you, however, is that they spend every single spare minute of their time tracking down people who are behind on their mortgage payments, or that the properties they purchase need tens of thousand of dollars of improvements and repairs before they can be rented.
So how can you make sure you have a local read on what the investment property market is like in your area?
Contact a local Realtor who specializes in investment property. Go in to his or her office and have a conversation about the market, what their clients are finding, and where they see the market going.
If you’re in the Twin Cities, please feel free to contact me for that conversation. I’m always happy to share what I know.