where is everyone cash flow Assets gone? With high interest rates, low inventory and no increase in purchase prices, it is becoming harder and harder to find your margin. Finding cash-flowing assets is even more difficult when your investment budget is modest. That’s why we love Dave Meyer’s recent instagram posts Covered his top five cash flowing market picks with an average purchase price under 200k. Sometimes when you’re looking for your next deal you just need someone to help you keep the ocean from boiling over.
Meyer looked at average purchase prices but also reviewed some other positive financial indicators in each area to support his recommendations. We’ve pulled them together along with a few more reasons that these markets deserve further investigation. Of course, nothing is all roses, but there sure are diamonds in the raw!
1. Syracuse, New York
Why we love it:
- Average purchase price: 196k
- Average Rent: $1,500/month
- Rent-to-value ratio: ~0.80
- Home prices still rose 11% year-on-year.
- New technology companies are moving into this area.
- Good for added value, buy and hold investors. According to a recent study, only 27% of Syracuse housing is in “good or excellent condition,” meaning investors have the opportunity to buy at low prices, make repairs, and enjoy both compulsion and market appreciation.
2. Lansing, Michigan
Why we love it:
- Average Purchase Price: 191k
- Average Rent: $1,000/month
- Rent-to-value ratio: 0.73
- According to a study done with US Census data, the fastest growing are the “Midwest-metro”, many of which are moving beyond the Detroit area.
- Michigan State University has reported off-the-charts enrollment over the past few years, bringing record levels of young professionals to the field.
3. Scranton, Pennsylvania
Why we love it:
- Average purchase price: 176k
- Average Rent: $1,200/month
- Rent-to-value ratio: 0.68
- Buyers are finding properties at 3% under list price, which means you can probably find a deal, which will help compensate for the low RTP.
- House prices may continue to rise. According to Zillow’s Home Value Index, Scranton home values are up 4.8% year over year (March alone saw a 1.5% month-over-month increase).
4. Toledo, Ohio
Why we love it:
- Average purchase price: 173k
- Average Rent: $900/month
- Rent-to-value ratio: 0.52
- Excellent population growth.
- Leading indicators such as inventory, new listings and days on market suggest that prices may continue to rise. This is a great place for long term holds.
- Strong rental demand and relatively low vacancy rates.
- Diversified economy (manufacturing, health care, education).
5. Springfield, Illinois
Why we love it:
- Average purchase price: 171k
- Average Rent: $1,300/month
- Rent-to-value ratio: 0.65
- Strong fundamentals (low unemployment, fair wages, short commutes, etc.) and strong hiring.
- AirDNA ranked Springfield as the fourth best place to invest in STR in 2023, based on rent seeking, growth, cash flow and regulatory risk (2 out of 10).
For our full analysis of the top cash flow markets in 2023, read this article here.
rental price data Zillow,
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Note by BigPockets: These are the views expressed by the author and do not necessarily represent the views of BiggerPockets.
