If you ask me, investing in multifamily properties is always a matter of location. In fact, a solid investing strategy has to have a target in mind. You just can’t go out there with guns blazing. You need to know where the money is before moving in to acquire properties.
In my multifamily syndication academy, I will always tell my students to be more clever when it comes to utilizing their hard-earned money. Considering the complex dynamics of multifamily marketing, it is crucial to find areas of opportunity wherever they are.
Research has always been the key for me. I have had a total of 26 syndications, but I have to tell you that I also am in midst of a downward trend market in 12 years and working hard to minimize the losses. Whether it was due to a precarious economic climate or failure on the management side, either way, the losses should be minimized quickly. We put forth extra effort in terms of research when we were buying. The jobs were expected to come, new motels were under construction, new restaurants were opening, and the local city officials were very bullish on the new jobs coming into town.
With that being the case, investors will have to hunt for places where they can grow their money. It’s only a matter of knowing which states offer the right climate for nurturing cash flow.
California
The Midwest and South East have been a prime choice. With rising property values and a healthy balance between inventory and demand, it’s no wonder these states remain to be an attractive place for people who want to utilize their self-directed IRAs and grow their wealth in the long run. A good way to start investing in multifamily properties in these places is to join multifamily syndications that provide you with greater transparency over your investments.
Georgia & Texas
Not to be outdone, the east coast is also offering greater opportunities for first-time investors. Across its cities, Dallas and Atlanta are slowly becoming a promised land for class-A apartment complexes. The cap rate remains very robust at least 5% for class-A properties. Indeed, as the median price for single-family properties slowly increases, we will be seeing an increase in demand for rental units, which should accelerate appreciation and invite more investors to join in on the action. Here’s a tip, though: Look beyond the Atlanta metro area and hunt for properties in the outskirts. Development is slowly seeping towards these places, so it’s best to move fast before the competition picks up.
Florida
The prospect of retiring isn’t complete without thinking about moving to Florida. In the mind of many seniors and millennials, the state has the right formula for starting a new leaf. Property appreciation has been consistent in recent years, and this has created a lot of opportunities for people to start building their portfolios. Apart from that, income from rent has been pretty much high at $2,000 a month while the average price of a multifamily property stays well below $1 million.
At any rate, the best way to know if a city is right for your investment is to determine if it’s an emerging market. DO LOTS OF RESEARCH!!! As such, it should have steady job growth and enjoy private and public investments.
If all these indicators are on the right path. It’s a sign that you have finally found a place you can let your money grow!
