Canadian investors need to stop picking U.S. markets based on current low price and start thinking of the bigger picture.
That is one of the mistakes that many Canadians are making today, according to seasoned investor Michael Jakobczak from US Fast Track
“Obviously, conditions have changed a lot in the U.S. in the last few years but there are still some bargains out there,” says Jakobczak. “But investors really have to be market specific now and look at the long-term prospects, and not just what low price they can get.”
Jakobczak points to Detroit as a market that investors need to know every corner before buying. “I always say that Detroit is a good market for local investors. They can be very hands-on properties and time consuming.”
Now owning 136 units, Jakobczak says investors need to start following the working population, as is the case in Atlanta, Georgia. “All of the Fortune 500 companies have a presence in the city, you have a high educational workforce and a busy airport. People are not loyal to any city anymore and you have to ride along with that ship.” He points to similar growth in Texas with Austin a “favourable” market.
“You should only buy into the expensive markets, like Silicon Valley, if you can see it as a 30-year investment,” he advises. “Flipping is a good business to build up capital and an investor base but there is obviously a lot of risk. Even the best flippers lose money.”