Author Topic: Exurbs for Real Estate Rentals?  (Read 2308 times)

rothwem

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Exurbs for Real Estate Rentals?
« on: September 15, 2016, 06:35:33 AM »
Does anyone here have experience with renting out houses in the "exurbs", ie, the areas ~1 hour from a city?  There are a couple small towns outside of Raleigh (Fuquay, Wilson, Dunn, Willow Springs, etc) with much better rent/cost ratios that I've been looking at, but a couple things give me pause:

-They're farther away from me.
-Local economy is (kinda) unknown?
-Potential for rent deflation/appreciation is unknown?
-Potential for home value deflation/appreciation is unknown?

So, with that said, has anyone here tried it? Not Raleigh specifically, but investing an hour or so outside a major city.  How did it go?

Bobberth

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Re: Exurbs for Real Estate Rentals?
« Reply #1 on: September 15, 2016, 02:49:50 PM »
I don't have any first hand knowledge of this, but my Mother's family is from an area ~30 minutes west of Topeka, KS. I have two uncles that have rental properties in that area and some even further away from Topeka by another 15-30 minutes. I don't see them much but last Christmas I was talking to them about their rentals and the one seemed to be doing ok but the other one was having a hard time with vacancies, which he attributed to people not being able to afford to live so far from work because of gas prices. Don't know how accurate that is but it would be a concern on mine in that situation. That uncle is known for being a slumlord with his properties so maybe the properties are too word down now or he has burned too many people though.


MayDay

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Re: Exurbs for Real Estate Rentals?
« Reply #2 on: September 15, 2016, 06:11:23 PM »
My MIL has 3 that are in small towns about 30-60 minutes from Cleveland, OH. 

She has one with an extremely steady tenant for 10+ years who does all his own repairs.  He "wants to buy the house" but seems unlikely ot ever be able to improve his credit and/or save up a DP.  But he pays the rent. 

The other 2 are a constant turnover of shady tenants.  I attribute it to the low cost to buy a house in the area.  Anyone with any self control can easily buy a house for 100K or less, so you end up with crap tenants. 

So I think it has more to do with whether it is a desirable area to live with higher costs to buy that push people to rent. 

RodFoster

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Re: Exurbs for Real Estate Rentals?
« Reply #3 on: September 18, 2016, 06:04:26 PM »
I like Exurbs when they have some jobs and their own economy. I worry that in a recession they could feel the pinch more. No data to support this concern.

Blindsquirrel

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Re: Exurbs for Real Estate Rentals?
« Reply #4 on: September 19, 2016, 03:19:05 PM »
  We do really well about 30-45 min out of town with a semi rural area. It is close enough for a longish commute but quiet area with low crime and good schools. Price appreciation is very solid.

Goldielocks

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Re: Exurbs for Real Estate Rentals?
« Reply #5 on: September 21, 2016, 04:24:11 PM »
i only had one similar to your description.   

A three bedroom walking distance (half mile)  to a decent school is usually a good bet, especially if the financials work at just under the going rental rate.

You want a tenant with a family, or a teacher, that will stay for 2 years, with an end of lease around July 15th to get a re-rental with only a month of vacancy.   I had a lot of interest, more than expected, as the neighborhood did not seem like there were many rentals in it.  (Maybe that is why..?)

smoghat

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Re: Exurbs for Real Estate Rentals?
« Reply #6 on: October 03, 2016, 04:16:00 AM »
Exurbs have been declining since 2008, so it may be a poor investment. I don't like all of those unknowns. You should do more research or avoid it.

rothwem

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Re: Exurbs for Real Estate Rentals?
« Reply #7 on: October 04, 2016, 06:55:15 AM »
Exurbs have been declining since 2008, so it may be a poor investment. I don't like all of those unknowns. You should do more research or avoid it.

Yea, that's kind of what I've concluded. 

Thanks for the opinions, everyone. 

clarkfan1979

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Re: Exurbs for Real Estate Rentals?
« Reply #8 on: October 14, 2016, 01:20:48 AM »
It depends on how much you pay for the rental and how much rent you can get. Without knowing those two things first everything else is irrelevant.

Blindsquirrel

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Re: Exurbs for Real Estate Rentals?
« Reply #9 on: October 17, 2016, 06:45:12 PM »
You may wish to explore a bit and compare price to rents extensively. We have done very well at this. PM me if you like.

zephyr911

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Re: Exurbs for Real Estate Rentals?
« Reply #10 on: October 19, 2016, 03:28:26 PM »
Exurbs have been declining since 2008, so it may be a poor investment. I don't like all of those unknowns. You should do more research or avoid it.

Yea, that's kind of what I've concluded. 

Thanks for the opinions, everyone.

I'm looking at revitalized urban core areas that haven't come up in price yet, personally. Increasing numbers of people want to live close in.

But the exurb itself may have a good job market based on a service economy and other things that have come up since its growth, so I wouldn't write them off.

rothwem

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Re: Exurbs for Real Estate Rentals?
« Reply #11 on: October 21, 2016, 11:24:30 AM »

I'm looking at revitalized urban core areas that haven't come up in price yet, personally. Increasing numbers of people want to live close in.

Yea, in Raleigh there's a pretty small downtown area and as a result, its already getting inflated.  That's the first place I looked though.