Finding Your Investment Property

bend oregonRight now I’m up in Bend Oregon looking at potential real estate investment properties. I drove up here from San Francisco last Friday and will be here until the 28th. Oregon has really boomed (especially Bend) over the past several years and it shows. I remember coming up here years ago and seeing single family homes going for $250k. Now the same style is going for $450k.

My observations:

  • More people are moving up here to retire
  • Investors bought up properties since CA or other west coast states are too pricey
  • Oregon was undervalued or at least perceived that way

Now I actually came up here looking for a vacation/rental home for myself. Something I could rent out 75% of the year via a rental agency and vacation the other 25% of the time. What I’ve found so far isn’t too bad assuming vacancy rates will stay low. There are also a lot of inventory since local owners are trying to cash out. That gives me the advantage and I can low ball on the offer.

How did I find property to look at?
I first narrowed down my search to a single location — Bend. I then hopped on the internet and printed out a list of potential properties. I called the realtor for each and setup time for showing. During the time I wasn’t looking at properties, I crunched the numbers to make sure everything worked. If the realtor told me vacancy rates are usually 25% I bumped that number to 35% and then did the math.

I’m still evaluating properties and should have a decision by this weekend.

21 thoughts on “Finding Your Investment Property”

  1. For Investments ,Take a look at St Augustine Florida real estate we have some great deals that I would like to present to you. for example I have 10 units each 2/2 with 1274 under air selling for $167,000

  2. Hi Mitchell, thanks for the comment. From what I’ve read, most of Florida’s real estate prices have been inflated but $167k sounds pretty cheap. What would a place like this rent for? How old are the units?

  3. Branson Missouri makes a great spot for real estate investing. Single-family homes sell for $125,000 to $150,000 and they rent for $900-$1,200/per month. Apreciation was 22.5% in 2005 and 10% or so in 2006. Deals like that are harder and harder to find.

  4. Mississippi is a hot area for real estate investing…why?

    Three quick reasons. The huge number of available foreclosures, the amazing tax incentives in the aftermath of Hurricane Katrina, and the huge opportunities brought on by the sub-prime meltdown.

    In addition, it is because the numbers work. In the Capitol City of Jackson, the state’s largest city and the surrounding metro area, the rents relative to the value of the homes are very high compared to other areas of the country.

    The population of the Jackson metro area is over 500,000 people, about 195,457 live in Jackson proper, and the balance in the suburbs.

    The Jackson median single-family home price is $80,761. The state median is $71,067. This means Jackson is one of the least expensive metropolitan housing areas in the nation. Property taxes are also relatively low. The average age of homes in Jackson is 35, compared to the national average of 38. Jackson is a strong rental market, 42% of the homes are rentals.

    According to the National Association of Realtors, Jackson saw single-family home appreciation of 8.9% year-over- year at the end of Q3 2006 (compared to -1.2% for the rest of the US), placing it in the top 15th percentile of metro areas in the U.S. Jackson is ranked as the 9th most undervalued metro region in the U.S., placing it in the top 3% out of 317 metro areas, according to the March 2007 Housing Valuation Report by National City Corporation.

    In 2006, Jackson was named of America’s Top 30 Livable Communities by Partners for Livable Communities.

    Despite the low housing prices, rents, relatively speaking, are much higher. According to HUD statistics, the 50th percentile rent for a 3-bedroom dwelling in 2006 was $826 per month. This makes Jackson one of the best areas in the country for positive cash flowing rental properties.

    The economics in Jackson are clearly favorable for real estate investments. The key to investing in Jackson lies in careful selection of the investment company, working with that company to select homes in the right locations and neighborhoods, and carefully selecting tenants and property managers.

    For more information about real estate investment opportunities in Mississippi, please visit my blogsite at forecloseddeal.blogspot.com.

  5. Hello everyone….I enjoyed reading about your trip to Oregon…I am a full service Realtor serving the greater Cincinnati and Northern Kentucky real estate arena. If I can help anyone looking in my area please visit my website .

  6. Look here for great real estate opportunities in Baja Mexico http://www.prubaja.com – Prudential, Baja Real Estate – California Realty – Northern DivisionPrudential, Baja Real Estate – California Realty – Northern Division. Your best choice for investing in Baja property.

  7. I read a book regarding the HUD Foreclosure opportunities out there, and it was awesome. I have been doing real estate for several years and this is the first one I have seen like it. I reccomend it for anyone who hasn’t been scared of the real estate market since this down-turn. The book s called HUD Made Simple, Your Government Foreclosure Investing Guide.

  8. My success has been in finding sweet spots for renting in downturned markets. For example, college campus areas (while students are stereotyped as bad renters, I haven’t found this to be true) and combine that locale with architecturally significant homes–I’ve actually shown appreciation while renting. For example, please look at http://www.architecturalrentals.com to see what I’m talking about.

  9. Bend, OR had seen some great appreciation in years past. Partly due to investor speculation from CA investors, as well as the easy lending guidelines banks had.

    That time has unfortunately passed, while if investing in today’s market, one should focus on either buying at a HUGE discount and a buy and hold property.

    Rents are really low in Bend, Portland and many other highly speculative markets around the nation.

    Mississippi, Tennessee, North and South Carolina, Oklahoma, Missouri and several other states still offer good quality investment opportunities.

    Bend will come back in time, but rampant appreciation will most likely never be what it had been due to the bank blowup. Money will most likely never be as easily obtained, making it more difficult for speculation.

    All the well, a lesson learned and an opportunity gone.

    Denton Ward
    http://www.erealtyinvestors.com

  10. I rent about 30 units in Murfreesboro TN, our townhomes are about 1 mile from campus and most of our renters are collage students, I would say about 50% of them are ok renters the rest trash the place.

  11. If you are serious about investing in the #1 area in the U.S, visit SFLA Investments. We are your one stop shop for your Real Estate Portfolio needs, from acquisition to tenancy to management, we take the work out of investing.

  12. Baja Real Estate Group
    is the premier on line resource for purchasing a home, selling a home, financing and property listings. Baja Real Estate Group can assist you with your real estate needs, whether it�s a house, condo or other type of property. Baja Real Estate has been doing business in Mexico since 1990.

  13. When investing in an area, you definitely need to be as analytical as you are. An investor who doesn’t do his homework is an investor whom will not be investing for a long time.

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