New investor here! Looking for advice on picking a market or an area where to start my mailers. I’m on the east coast and not locked to specific location as I work online. Do you have any tips on things to consider for picking a good area to find motivated sellers?
Thanks!
@paulomunera Hi! if you check module 2, I think there’s all you really need there. Then you can personalize it as you think is better for you. In my case I decided to make a spreadsheet where the first Sheet (State search) is divided into 8 columns respectively depicting:
- ranking migration growth (report 2020 UHAUL)
- report 2020 United Van Lines
- top 5 inbound States and top 5 outbound States iaw the report 2020 North American Moving
- ranking pop growth 2010-2020
- closing type (Title Company/self closing Vs Attorney)
- disclosure or not disclosure States
- judicial vs non judicial foreclosure States
- ranking property tax burden for 2021
Of course I assigned a weight to the above parameters but I think that is discretional (for example: pop growth is more important for me than tax burden or movements inbound/outbound is a better indicator than disclosure/not disclosure)
Once that I filled the columns with the data available on the internet (as described by Seth and Jaren and for some of them you can refer to the blog posts you find on REtipsters) I had a clearer idea of where I wanted to invest, selected my top 4 States and, according to the data available and verified the presence of potential touristic attractions nearby, I went for “THE one” (actually I also gave a quick look on Landwatch just to see if someone is “moving Land” in the State or not…:))…).
Then which County there? To help me answer this question I used the second sheet (County Search) on my XLS file. Starting from the table very thoroughly described by Jaren in Mod 2, I took the liberty to add some further columns for each County: - population density
- on sale in the last 6 month (0-30 k$, 0-10 Acres, in order to limit the search)
- sold in the last 6 month (0-30 k$, 0-10 Acres)
- 10 cheapest in the range 0-4.9 acres and average $/acre
- 10 cheapest in the range 5-10 acres and average $/acre
- average days on market
- average views
- online presence (GIS, Prop appraiser, tax collector etc)
I ran my numbers, identified the 4 top Counties and picked what I considered to be the best according to the results.
Sure it took some time and truth is that I probably put too much work to collect info not so relevant at this stage but the process made some sense to me, so I decided to give it a shot.
Being myself totally new, take it just for what it is: the approach of a newbie willing and happy to share and learn. You’d better listen to more experienced investors here that sure will be able to effectively provide you (and myself) with deeper insights.
Good luck!!
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@arturo hey thanks for the insight! New here as well.
With that, do you get concerned if there are a large number of properties sold in the last 6 months, but not many for sale? Makes me concerned that the market is almost too hot and people wouldn’t want to sell me their land.
@arturo Great post thank you. Do you mind sharing where you get the data for the first 4 criteria (mig. growth, inbound/outbound, pop growth, UVL).
Thanks!
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@dyer22adam what I did was to consider both (ON SALE and SOLD). The reason is that, in my mind, ON SALE listings should be a good indicator to understand how easily i could buy (theoretically, more the sellers, better the chances), while SOLD listings are supposed to inform me about how easy it could be for me to find buyers (in this case, more the buyers, better the chances). That said, due to the fact that the selling part seems to be the most challenging one in the business, my preferences went to those Counties where the SOLD listings were higher than the ON SALE ones.
Competition: reading around I essentially see 2 different approaches used by experienced investors. Some is chasing areas that are not top ones (according, for example, to the demographics) in order to be able to work in a less competitive market (example: David Van), others are simply not afraid of competition at all, on the contrary they consider it a an indicator of a good market (example Mike Ferreira). So I don’t think there is a general rule and yes, I have your same doubt and I just decided to go where the deals are but only experience will tell me if this approach was good enough :).
@arturo that makes sense. Excellent way to sum that up. I appreciate you for that. Going to be sending out my first mailers soon! Best of luck to you.
@wes hello. You can check the following:
https://www.unitedvanlines.com/newsroom/movers-study-2020
https://en.wikipedia.org/wiki/List_of_states_and_territories_of_the_United_States_by_population
For the last one, once into the wikipedia page, look for the “State and Territory Ranking” Table, which is pulled out from the Census.
I hope this can help.
Enjoy,
Arturo.
@paulomunera
I think you will find this helpful go to Data Tree
You will find all the info here so much more as well.