Kris Krohn here with Limitless Wealth TV and today we're talking about the worst
cities to invest in when it comes to real estate.
Worst cities in America to invest in. Steven, we could list off lots of cities
but instead, we want to actually teach you principles, three specific principles
for what you need to look forward for what could be a good city or a bad city
and the reason why we're doing this is because we get a lot of comments, people
like, "Hey, I live in New York" or "I live in San Fran and how am I exposed to
actually breach and get into real estate?" And here's the reality, sometimes you
just shouldn't be limited to what's in your back yard because what's in your
back yard is not, this is my stank face, it's not what you should invest in.
- Look, again, we love America, we're not here to call out any specific
cities, don't care where you live and what your situation is - Because you all
should be investing in real estate - We should all be investing in real estate but
I want to talk about what, we want to know about what makes up a bad city to invest in,
meaning what are the specific things you need to be taking a look at and the first one
is the economy. How is the economy doing? Is the economy increasing right
now? Is the economy decreasing or is there job growth or are jobs being moved
out of your city or your state that you're in right now? - All you got to do is
stop by City Hall, your local County and just ask around a little bit and just
say, "Hey, where's the path of progress? What's going down?
Like for example, Steven and I, we live here in Utah so this is central base for
how we run our entire national conglomerate of doing real estate in all
states in America and one of the things that's really great about Utah is
that Utah super attractive to companies like Adobe that's moving in and Google
and these large corporations and and if you go down and talk to the city, they'll
tell you, "Oh, over the next 10 years, we think that we're going to grow, you know, by
900,000 people." And they look at that growth and it becomes very
apparent whether you're in an area that is booming or dying. - There are
literally hundreds of millions of dollars being put in maybe even billions
of dollars being put into these economically growing areas that you want
to be investing in and so you want to look for that, you want to say, okay, well
what's being put in? What kind of infrastructure is being built on their
roads and freeways and highways that are being built right now? Are companies
coming into these areas and establishing their businesses here? And those are good
indicators of that being a place that you want to be investing in. Now you need
to watch out for a very important economic principle called
economic winter. Okay, economic winter is talking about specific areas around the
country where there's two things that are happening. We talked about the first
one which is, how's the economy itself doing as far as business growing or
shrinking but what you especially faced with economic winter is when a
specific area, population wise, is decreasing, people are not replacing,
people are moving out of the cities. So there are some areas in the Midwest, for
example, where right now, they are shrinking. What happens to real estate if
no one is there to buy it? - It's left vacant. - It's left vacant and it's worth
nothing. A home is only worth what someone's willing to pay so if you have
an area where enough people are moving away, you're going to get these ghost towns,
this is already happening in Europe, right now America is still doing quite
well as far as to star population growth, we're barely replacing ourselves which
means to humans get together and they average making more than two humans but
there are places in the world where that is not the case and that is really
hurting real estate a lot. - One part of this you want to be aware of and this
is kind of a little bonus, I just wanted to throw in for you, is to be aware of
the governments in the different areas that you're in and this isn't even state
by state, this can be city by city, you want to be aware, is this government, is
it a landlord friendly government or is it a tenant friendly government? We've
had experiences with both, we've been in areas that have been extremely tenant
friendly when that's the case for a landlord, for an entrepreneur, for someone
that's an investor in real estate, it's not good. - Well it's the difference
between A, someone is actually not paying the rent and the local
government is going to let them squat for 90 days or a 180 days before
we actually pull them out of there and that's, you still have a responsible at
the bank, you still owe money and yet they're
actually, the tenant is protected to stay in their victim financial situation and
then you as the investor get to carry the brunt. So there are other areas that
are the opposite. 3 days you're out, your butt's grass, you're gone.
- So the worst of this America are those that are very tenant friendly so stay
away from those. - Yeah and then the last thing that we want to share for
today's video is, check out the median income for the area. You know, people's
ability to pay rents, people's ability to pay for your house really comes down to
how much money they make and there are some areas where the average
income is $60,000 a year and there are other areas where the average income is
$30,000 a year, now when a household income hits $30,000, that's considered
poverty level. Nationwide in America, the average household income right now is
sitting right around $59,000 and so, obviously, when you get to
a very micro level and you have a house and you're vetting attendance, obviously,
the tenant that makes more money and as a better credit is going to make a
better tenant so before you look at it on an individual at basis, you want to
look at it the macro level which says, well let's judge this city and citywide,
the average income here is $30,000, average person, I'm going to deal with is at
the poverty level, that may not make your best long-term tenant in the home and
being facetious, it's not going to make your best long-term tenant home but some
of the areas when Steven and I invest nationwide, for example, you know, the U.S.
is made of 360 sub markets, somewhere around there and when you take a look at
each one of those markets, what we do is we have a classification system that
eventually says who are the dogs and where are the rock stars. I can tell you
for example that we go into a very small part of Florida into the Kissimmee
County, just south of the state parks, Disney and things like that, the average
employee that fills up that entire population there of running Alice's,
those are houses that we're still buying for 120, 140, 160 that still cost over
$200,000 to build but the average person there makes
$60,000 a year, okay, and what does that equate to? That equates to not
having a problem with first of all, the vacancy problem, we don't have that but
more importantly, repairs, missed payments, and things like that just aren't going
down because the economics are good so you take a look at that at market and
the other four markets we're in right now, strong economy, strong population and
then you also have really really strong income for the average person living in
that area. You put those three things together and add the fourth one, Steven's
bonus, on governments that are friendly to investors and favor us and the
decisions of how we manage real estate and you're going to be stepping into a
fantastic market. If you want to know more about what these markets are,
there's a video up here that you can click that we've shot earlier on our
favorite hot markets where we're investing right now and
after you done that, you can also click this link and we will share with you
what it would look like to work with our team, you can access our 200 experts and
we'll take you right into those markets, sight unseen and actually help you buy
all of that real estate, give you a hundred percent of the ownership but
we'll take care of all the hands-on management and day-to-day so that you
get to come out like a rock star. So those are the principles on the worst
cities to invest in but if you're ready to invest in the right cities, the best
cities around the entire country, click the link up here and start actually
viewing some of the deals that me and my team are doing and jump in and request a
consultation where we'll sit down and give you a game plan on how you can
start investing in the best cities.