Best Real Estate Markets for 2020
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Best Real Estate Markets for 2020


what’s going on guys is Daniel one half
of the Kwak Brothers and in this video we are going to be talking about the
best rental markets in the year 2020 so let’s cue that intro let’s get right to
it alright guys welcome back and in this video we’re gonna be talking about the
best rental markets in the year 2020 which is next year right at the time of
this recording it’s 2019 so we’re gonna be talking about the very next year what
I foresee to be some of the best rental markets in the year 2020 we’re gonna be
talking about how I get to those conclusions and ultimately why along
with different sources that state in terms of the data they provide as to
what is the best rental market for the year 2020 all right so let’s go ahead
and begin but before we begin as always feel free to go ahead and click that
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ahead and now talk about the topic at hand right the best rental markets in
2020 but first we have to identify what makes a market a good rental market you
know what is it and of course throughout my years in investing in real estate now
being to the point where you know I’m able to do deals kind of all around the
country you know from west coast to East Coast
you know obviously the Midwest where I’m from did a lot of deals there and now
I’m doing actually some deals currently down in some of the southern states so
you know I’ve had the absolute honor and pleasure and really just the journey and
fun of being able to fly all around the country and not only train people but
also do deals in those respective states as well respective states as well so
let’s go ahead and talk about first markets can change right so in terms of
markets changing there’s a couple things that we can talk about here there you go
how markets can shift and change and there’s a lot of things that obviously
we can talk about we can talk about employers we could talk about the
economy we could talk about a lot of different things but I want to bring up
two things that I see not a lot of people talking about right and obviously
the first one that many may say is value but the reason why I bring up value is
because I feel like it’s one of the most misunderstood terms in terms of you know
everything that’s out there and again guys my goal with this video and also a
lot of our real estate investing content you know my goal is to not repeat things
that a lot of other individuals say when you come watch our videos in our Channel
my goal is to introduce things to you that nobody ever talks about you know
new things new pieces of value that not a lot of people say you know I don’t
want to just be an amplifier I want to be an originator of content so that you
guys can enjoy so I want to introduce a very new concept of creating value but
also understanding the value of real estate prices because again you know you
turn on CNBC you turn on a lot of these different channels and you know home
prices and real estate prices is something that a lot of times people
misunderstand and for me you know a lot of people put emphasis on the value but
that that is true right that is true long term especially when you’re
securing financing right so when you’re securing financing especially if you’re
being financed by the bank a lot of times value is made and is therefore
risk assessment I don’t think I spelled assessment right is the two S’s or one s
comment down below what you think it is right so whatever you say it is that’s
what it is all right so a lot of times risk assessment is attached to financing
which is attached to value a lot of times people consider the up
and down prices the value right like a lot of real estate investors will be
happy when the value of their apartment complex or their a single-family house
that they’re writing out goes up but in all reality does it really truly matter
when it comes to your cash flow the answer is no because you know even if an
apartment building is valued at 2 million versus 1.5 million the rental
income is rather still the same right your everybody still paying rent right
your tenants are not gonna care whether or not the apartment they live in is
worth 1.5 million or 2 million they care what the rent is right and they’re gonna
pay that rent so the value doesn’t necessarily matter because that’s what a
lot of people refer to when it comes to value but in terms of the word value you
know it pertains more to long-term and financing a lot of times long-term
financing with banks because well what happens what happens you know is a lot
of times that loan to value ratio may be a little too high meaning that the loan
that you have on the apartment complex compared to the value is not something
that the bank’s want to see so for example if you have a you know 1.9
million dollar loan and at the same time the value is 1.5 million that means loan
the value is right in terms of the percentage that loan is more than a
hundred percent of the value which in this scenario is 1.5 million so the 1.9
million is greater than 1.5 therefore the loan and value ratio is over 100%
this is a scenario where I would argue that this is where the value of the
apartment complex or the rental property matters the most especially when you’re
getting long term financing from a bank or a financial institution because well
this value is going to dictate right how the bank is going to treat you and also
the risk assessment at the end of the day right at the end of the day the
banks care about assessing the risk they’re in the business of making money
themselves but they don’t want to be in a risky
right to where you’re not be able to pay your mortgage payment or the the value
of the collateral of the note which is the building itself because obviously
you guys can see that well if you have a loan up for 1.9 million and the value is
only 1.5 that’s a $400,000 spread the bank’s start to worry because well what
happens in a situation where you have to sell the building because let’s say the
building is not performing up to standard or you know you have very low
equity position a lot of times I’ve seen scenarios guys I’ve seen scenarios where
the banks will call the landlord they’ll call the investor and they’ll ask for
$400,000 in cash to make up for this difference okay guys this is not a
matter of opinion I’ve literally seen this happen to many many real estate
investors who own apartment complexes the banks call them up they ask for that
$400,000 spread and that’s a scenario that we don’t want to be in because well
not everybody has $400,000 if they could just pull off and if you’re a real
estate investor that raises capital well the last thing that you want to do is
call your investors and do a partnership call right or do a money call to where
you have to call everybody involved in the building and raise that $400,000
without really any good return any reason for return so the value that’s
something that a lot of people don’t talk about this situation right because
again the value this is where the word value pertains to the most this is where
the value of an investment property is going to be rather important right
another thing that people don’t understand in terms of how markets can
change is the financing and it only may seem we just talked about that but I’m
not talking about the specifics of the financing like what we have here in
terms of the loan compared to the value I’m referring to more who finances you
so when I’m looking at a market when we’re answering the question of you know
what are the best rental markets in the year 2020 well we have to look at the
markets what assets are there and what type of financing do they have let me
give you an example right so I am doing some fixing flips right I’m doing some
development deals but also some fix and flips
in a market that’s predominantly dominated by FHA now when I was doing my
market research when I was answering my own question of what’s the best rental
market for fix and flips in the year 2019 right and this was me in 2018
thinking about this right so I started asking myself that in August of 2018 you
know what the question being what’s the best rental market for mm I’m sorry
what’s the best fixing foot market for 2019 that’s a question that I asked in
2018 because I wanted to get it some flips so I asked myself well what drives
up prices right we’re in a market right now where it’s very it’s a bull market
which means the times are good right now I did a lot of these things you know
what are some key elements that’s gonna help me get higher prices because well I
want to be able to buy properties that are cheap but also sell it for very high
prices and what’s specific right how can I create a scenario where I don’t have a
lot of competition going into these buildings therefore my prices are low
but I could criticism position when I sell the building
therefore the buildings are high and I came to the conclusion I needed to I
needed to do my fix and flips in an FHA hot spot in cities where the FHA was
rather high because well government’s like yo government programs like FHA
they only you know they do something like 3% down therefore people have more
flexibility when it comes to offering prices on homes it drives up the price
because there’s more buyers and not only that but they have to put less down which means they’re able to afford a
higher purchase price for that home so after realizing this and these these are
the buyers that won’t touch the ones that that I would want right the
distressed properties the ones that are all torn down the ones that need
rehabbing they’re not gonna touch those right the the Millennial couple who just
got married and they just they just graduated college and they need to find
a home they’re not gonna buy a house that needs a hundred thousand dollars in
rehab they but they want to buy one right that’s a finished product that’s
where I came in and because of it we started getting
asking prices in terms of the properties that we’re selling
we started getting offers that were ten twenty five thousand dollars above our
asking price right so that’s how markets can necessarily change and it’s very
important for us to understand that as we’re preparing for 2020 where are the
best rental markets for 2020 so again that’s an example that I did for 2019
feel free to use that on your own and apply it to the question of what are the
best rental markets of 2020 now in terms of how I get this pieces of information
it’s very important that you guys were able to do research on your own because
well as much as I want to help you guys and teach you guys and give you the
answers which I’m actually gonna finish this video with the top five best rental
markets for 2020 in my opinion but I also want you guys to be
self-sustainable right I don’t want you guys to depend on
me for information so let me share with you guys some of my favorite places and
sites where I get my research reports in terms of market research and numbers and
vacancies and financing basically everything under the Sun so I have three
main sites that I visit to get research reports the first one is the brokerage
market Samila chap I absolutely love the research reports that they actually put
out so they put one out on multifamily and they actually put one out every
quarter along with an overview right they do an investment what they call an
investment forecast they put one out in the beginning of 2019 and also late 2018
it was literally just titled 2019 multifamily investment forecast and they
also put some stuff out on like self storage and basically everything else
when it comes to investing in real estate so all you have to do is just go
to their website Marcus the mill and then go to the research research report
section and I’m not I’m not getting paid by Marcus and will check by any means
I literally just love their resources and it’s also completely free so I want
you guys to take advantage of that as well another website that I get really
good research reports in is CBRE and they also have really good research
reports as well on multifamily single-family sell storage on basically
everything under the Sun one of my favorites also is IRR reports
so again they also put out a lot of great numbers on multifamily
self-storage single-family houses I saw one on like I think it was a cannabis
right there was a cannabis real estate and how that’s taking off how you know
the legalization of marijuana you know how does that how that affected real
estate market how you know a lot of the people involved in the marijuana
industry you know they can’t put money in the bank so they a lot of them put
money in real estate and that was something really interesting to read
about so Marcus and Milch at research reports CBRE and also IRR reports have
been really good sites and and places to go for me to get my data and a lot of
times here’s what you want you want raw data which is why I try and stay away
from like news right like CNN or Fox or anything like that because you know I
don’t want journalists who never invested a day in their life in real
estate and have no idea what we’re talking about here I don’t want them
basically putting out their opinion on the market right I want just the data I
think us as real estate investors and entrepreneurs you know I think we’re
pretty smart enough to recognize the data and get the data and figure out
what we need to do with it raw data what I want is I want to be able to see the
numbers for myself and create an opinion you know based on what I feel like I
need to do another thing to get more information and research on certain
markets is I love talking to the people there so here’s some of the things that
I do I join local real estate investing Facebook groups so one of the things
that I looked at when I thought about investing in Charlotte was I joined a
couple of Facebook groups for real estate investors specifically in
Charlotte I think one was literally called Charlotte real estate investing
group or real estate investors and kind of just scroll down through the statuses
and see you know what your what what other people are posting what other
people are looking to do and a lot of times I’ll create and build a network
around people in that group and I’ll kind of just call them you know connect
with them email them back and forth and just kind of ask questions about the
market what are they doing to respond so on so and on top of it I talked to
locals now I don’t mean just any locals I actually talked specifically to the
mailman or the mail woman all right I talked for people who work for the post
office out of anybody that I’ve talked to when it comes to getting information
on a real estate investing market the best person that talked to haven’t been
the Realtors haven’t been the brokers haven’t been the property managers which
by the way every single one of those three will tell you that their market is
hot because they make money off you doing deals in that area so be careful
about what they tell you but out of every single person I talk to the most
information and the best information that I’ve gotten about certain
neighborhoods in certain markets have been talking to the individual that
works in the post office the mailman or the mail woman the individuals who walk
around the neighborhood every single day delivering mail they have been by far
the best people to talk to not only that but I’ve also gotten deals out of them
because they told me like hey listen you need to check out this address the
person just moved out the grass is getting a little tall I think they’re
facing foreclosure right or hey this apartment this person owns it right it’s
been absolutely awesome the information that they’ve given me it’s amazing so
join Facebook groups talk to locals especially the mailman you got research
reports through Marcus another chap CBRE and IRL reports that pretty much sums up
what I do in terms of the macro research now let’s get into the best rental
markets now these rental markets I’ve identified with different qualities
because of course we got to look at qualities in terms of what makes a good
rental market right and when we’re answering the question of what are the
best rental markets in 2020 we’ve got to talk about these certain things we’ve
got to talk about employment and most important and more importantly who are
the employers right who are the people employing where for the biggest
employers in that city right who are the individuals and the companies that are
providing the jobs that’s what we want to know because if it’s a strong company
and they have a very less likelihood of moving anywhere anytime soon well that’s
a good area to invest in while people there will always have jobs
employers and also age demographic and obviously you guys are probably thinking
about Millennials because well myself also as a millennial you know based on a
lot of research and data and really if you just turn on the news you’ll be able
to figure out that Millennials aren’t buying houses we’re not buying as much
houses as other people thought we’re actually more renting than anything
because we want the mobility we want to be close to the action the downtown
areas you know we want to be near the cool experiences like the restaurants
and also by the train station for commuting and we’re just not buying
houses it’s weird you know I mean like I personally own a home right I own my own
home but a lot of my friends that I’ve graduated with and a lot of my friends
that have even jobs that and they’re making six figures even as a millennial
somebody in their mid-20s they’re still renting yeah I mean so it’s rather
amazing so age demographics it’s also something that I pay attention to
because well that’s also important if I have a lot of Millennials I know that’s
gonna be a great rental market and I also know they’re gonna pay you know
because even the individuals the Millennials who make a lot of money you
know they’re paying which leads me to say the median income because if it’s an
area to where they’re making enough money to at least pay the rent but at
the same time perhaps not making too much money to where they can afford to
get a house at any given time you know I’m always paying attention to that and
BT an income you know do I have individuals that are able to pay the
rent rather than not pay rent right because that’s pretty important you want
people to pay rent I think that’s pretty obvious
all right so those three things are probably the top three that I pay
attention to now let’s move on to the list I’ve identified some top five top
five cities based on certain numbers that I deem to be pretty good you know
or let me just go with the title of this video the best rental markets in 2020
now guys before I say these keep in mind that these are based on a lot of
articles research reports that I found and a lot of other investors may be
targeting these areas already so the question that I have for you is how are
you going to stay even one step ahead of individuals that’s something for you
guys to remember as well remember this video is not the end-all be-all if
anything every single video that I post and regards to real estate investing I
wanted to be a jumping-off point I want it to be a stepping stone into something
else that you learn that way you could provide value for other people this is
just the beginning of a conversation so these are in no certain order I’m not
saying this is like number five to number one number one to five right no
certain order these top five are I deemed to be the best rental markets in
2024 now so I’m just gonna go with a right instead of one through five first
one I identified is Charlotte North Carolina now I’m gonna write some
statistics kind of over here and let me go ahead and erase that part but I’m
gonna write some statistics that kind of tell me as to why you know it has a
possibility of being the best rental market one of the best rental markets in
the year 2020 right stuff like unemployment median income and also
millennial migration let’s put that that sounds really really good so where
Millennials are moving to so in terms of Charlotte North Carolina let’s go ahead
and talk about the numbers in terms of the unemployment right unemployment
actually went down about thirty five point three percent thirty five point
three percent meaning that the unemployment number went down which
means more people are working more people are employed so it’s thirty five
percent point three percent down from where it was the year before or I think
it was like three years before is what the article said but it’s been down
significantly and also the median income has gone up fourteen point five percent
and also the Millennial migration the millennial population has gone up nine
point nine percent so it is also a city where a lot of people especially my age
the Millennials are wanting to move right another city that we have here is
Nashville Tennessee in terms of unemployment unemployment has gone down
48.1% there’s a median income it’s gone up 30.4% and in terms of millennial
migration it’s up 11.4% meaning there’s 11.4% more Millennials than three years
ago right or maybe it’s last year so I apologize guys I didn’t check the
numbers in terms of what they’re comparing it to but this is kind of
giving you an idea in terms of the direction that it’s heading all right
let’s go on to see we also have Austin Texas in terms of unemployment we’re at
45.1% down in terms of meeting income about 21.7% up and also 17.5%
high for millennial migration that’s probably that’s a big number right
that’s a really big number and again guys this is based on multiple different
articles and research reports averaging out certain numbers and whatnot
alright let’s move on to D D is Denver Colorado and you know it’s kind of funny
like it’s kind of funny when I list off a lot of these cities because a lot of
my millennial friends that I talked to like when they move there’s like a lot
of times this is where they’re going you know especially like Denver and
Charlotte you know a lot of the friends I graduated was in high school in
college these are the areas they actually end up going to good chunk of
my friends so in terms of Denver Colorado the unemployment number is
negative 46 point three so forty six point three percent down in terms of
median income we’re looking at thirteen point one percent up and also eighteen
point seven percent higher now this may have to do with the fact that a certain
substance was legalized in Colorado first I believe but let alone a lot of
my generation mala my fellow Millennials are moving into Denver
eighteen point seven percent higher than the last recorded piece of data let’s
move on to the last one which is letter E and letter E is Portland Oregon I
don’t know if that’s or I’m just going to do this to be safe
all right and there’s the unemployment we’re down 40.3% we’re up on median
income 28.3% and we’re also up in terms of millennial migration 11.3% now again
guys this piece of information is available basically to everyone because
it’s on the internet so there’s a lot of real estate investors who may have
looked at this this information right here so the questions I want to ask you
guys is how are you gonna stay one step ahead of individuals who are perhaps
looking at these pieces of data maybe you look into these specific cities and
you start doing some micro research like what is the unemployment number what is
this what is that and what is their rental market like has the rental has
rents gone up has it gone down what about vacancy these are things that you
guys could possibly look for to then practice and also get an idea of what
are the best rental market in 2020 so again guys I hope you enjoyed this video
again click the subscribe button and the bell icon notification so that you guys
can stay ahead of the game in terms of your real estate knowledge and what we
put out there so again guys hopefully this video was helpful in helping you
understand what are the best rental markets in 2020 I know that for these
five cities maybe two or three of them are definitely cities that I’m going to
make a move on which is why I’m raising a lot of capital right now to do so so
again hopefully this video was helpful much love to you oh and one more thing
if you guys want to check out our book 0 to 75 units it talks about my very first
step in real estate investing of what I did to get to where I am today
it’s called 0 to 75 units in one year it details the first step again that
eventually led to me acquiring over 75 units in one calendar year so feel free
to click the description click the link in the description below to check out
and get a free copy of that book we’re literally just giving it out to for free
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7 Comments

  • Jocina Kujna

    Thanks 🌴🍉 jocina Kujna 🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉🍉

  • Top Secret Bear

    Crime is skyrocketing in Nashville & prices of RE are very overpriced. It has turned into a place that most locals even avoid traveling to. So that should be taken into account. All the articles are saying that the market is great but usually the people that write those articles don't actually live there or if they do they live in one of the few safe places. In short, people may be migrating there but lets just say that the majority of those people moving there are not the type you would like to rent to. Most decent/good people that choose to work in Nash, commute there from other places and lock their car doors on the way into the city. Free insider info, do with it what you will.

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