In This Article

Condos could be the sleeper real estate investment you never thought you needed. If you’re looking to buy a severely discounted asset to capitalize on cash flow, a condo might just be the ticket because nationwide, condos have just experienced their steepest drop in value since 2012, despite house prices continuing to rise.

According to data from financial data and technology company Intercontinental Exchange, as cited by The Wall Street Journal, condo prices plunged in September and October 2025, with the biggest discounts in pricey coastal metros and investor-heavy second-home markets such as Florida. 

In Manhattan, a condo-saturated borough, one-third of the condos that changed hands between July 2024 and July 2025 sold at a loss, according to brokerage Brown Harris Stevens.

“The most promising opportunities for condo buying right now are in inner cities and areas with central locations that experienced drastic price adjustments, owing to the trend of remote work. Fairly located properties are available at significant discounts to buyers who do not mind the momentary mood,” real estate expert Andrew Reichek, founder of Bode Builders, told MarketWatch.

A Perfect Storm of Soaring Costs

So what’s the catch? Condos have been caught in a perfect storm of soaring HOA fees and insurance costs stemming from the collapse of Champlain Towers South, a 13-story, 136-unit complex in Surfside, Florida, in June 2021. Additionally, hybrid and remote work has cooled condo demand in urban areas, as workers can move to single-family homes in more affordable areas, dubbed “Zoomtowns” by Business Insider.

Jennifer Roberts, real estate broker at Coldwell Banker Warburg, told MarketWatch:

“Higher HOA and common charge fees and insurance costs are making [some] condos less affordable. Plus, older condo buildings are facing huge assessments and become a money pit. If one has a longer time horizon, it’s a good time to buy where the market is soft to take advantage of negotiating opportunities and being well-positioned for when the market recovers.” 

The Condo Malaise Is Nationwide

Condos are also getting hit from the financing side. The Surfside collapse prompted Fannie Mae and Freddie Mac to increase structural scrutiny of condos, requiring reserve funding for deferred maintenance before approving loans, leading many condo building sponsors and developers to pursue all-cash deals, according to MarketWatch. 

And the condo malaise isn’t just limited to Florida and New York. Texas cities Austin and San Antonio are experiencing a supply glut, forcing prices down, according to the Journal. Meanwhile, West Coast cities San Francisco and Portland are still reeling from the pandemic’s damage to their downtowns.

A Golden Opportunity

This delicate situation may encourage deep-pocketed investors, such as Wall Street heavyweights facing a ban by President Trump from buying single-family houses, to purchase condos for cash instead, though it’s too early to speculate. What is not debatable is that deeply discounted condos present a golden opportunity for potential landlord investors, provided they can navigate the additional costs of ownership and offset them with low mortgage payments and high rents.

Former Owner-Occupants Turned Landlords

The first wave of new condo landlords is likely to be former owner-occupants who have rented their residences rather than taking a financial hit by selling at a loss. This is especially worthwhile for owners who have low interest rates, and it’s a strategy that could be employed by all cash buyers who can swoop in and buy low. 

For investors seeking financing, it is still possible to get a great condo deal by adhering to strict underwriting guidelines that focus on HOA and insurance costs.

A Seven-Step Condo Cash Flow Strategy for Small Landlords

Step 1: Analyze a prospective condo based on the rent it can generate 

Calculate rents after HOA costs, rather than price per square foot. You can use the standard 1% rule to determine cash flow (i.e., if a property costs $300,000, it should generate $3,000 in rent), and adjust it for HOA costs.

Example:

• Purchase price: $300,000
• HOA: $600/month
• Target rent: $3,200-$3,600/month

If rents haven’t fallen in line with prices, the deal deserves deeper analysis.

Step 2: Analyze HOA profiles meticulously

All HOA fees are not created equal. Look for those that are about 15%-30% of the gross rent—less is always preferable. 

Here’s what else to look for:

• It has fully funded reserves (or at least 70% funded)
• There is no deferred structural maintenance.
• It has clear post-Surfside compliance documentation.
• There’s no pending litigation with insurers and contractors

Beware of red flags, such as vague language around “future capital needs,” HOA yearly increases of more than 10%, recent insurance nonrenewals, and high investor concentration (a complex with a majority of owner-occupied condos is always the most stable).

Step 3: Target fixable financial problems, not broken buildings

Examples:

• A catch-up plan is in place for underfunded reserves.
• Delayed engineering reports are scheduled.
• Buildings are transitioning from nonwarrantable to warrantable within one to two years.

Smart financing choices:

• You can put down 20%-25% in a conventional loan to minimize interest rate costs.
• Target local banks and portfolio lenders with flexible financing options.
• Look to purchase with cash (if you are able) and refinance later—BRRRR style.

Step 4: Geography counts, as insurance matters more than ever

• Target lower insurance areas such as inland metros.
• Northeastern and Midwest urban cores are in high demand.

Step 5: Consider rent demand

Condo values fell because buyers disappeared, not renters. Condos are usually built in urban areas with a high concentration of well-paying jobs. 

Look for condos near hospitals, universities, and transit hubs, staying away from luxury cores and instead focusing on secondary downtowns where prices are lower. Focus on cities where single-family rentals are unaffordable. 

Target these professionals to ensure premium rents:

• Medical personnel
• Graduate students
• Urban downsizes
• Corporate renters
• Divorced professionals returning to the city

Step 6: Underwrite conservatively

You are essentially buying a condo for cash flow, so keep appreciation out of the buying rationale. Buy below replacement cost, and invest for the long term. Estimate a stable rent growth of 2%-3% and an HOA creep of 3%-5%.

Step 7: Plan to have a three-pronged exit strategy

1. Cash flow hold for another investor.
2. Refinance once a building becomes warrantable.
3. Retail resale once buyer financing improves.

Final Thoughts

Condos are the deals hiding in plain sight. Because the condo narrative is so negative at the moment, many investors are bypassing them, expecting HOA fees and insurance costs to kill most deals. However, given the deep discounts being offered, they deserve an investigation.

One advantage of a cash-flowing condo is that, as part of an enclosed building, there are no external issues such as snow and leaf removal, roof upkeep, or gutter and downspout concerns to worry about. 

For the hands-off investor, condos make a lot of sense. Finding one that checks all the boxes is the all-important first step.

Dave:
This investor went from $40,000 in debt to cash flowing $20,000 per month. He only owns eight rentals and they’re all in his local market. Today, he’s sharing his secrets. Hey everyone. I’m Dave Meyer. I’m a rental property investor and the head of real estate investing here at BiggerPockets. Back on the show today is an investor who was the breakout star of BPCon 2025 in Vegas if you were there. And he’s also the host of the Dion Talk Financial Freedom YouTube channel. It’s Dion McNeely. If you don’t know Dion yet, he has an incredible story. He went from crippling debt as a single dad in his 40s to $200,000 in annual cashflow by buying rental properties near Tacoma, Washington. Dion, he calls himself a lazy investor. He says he only wants to do boring deals. He doesn’t like risky strategies or even huge rehabs. He likes basic, fundamentally sound, long-term rentals that will make him money while reducing his headaches, and clearly he’s been able to pull that off.
Today on the show, Dion is going to tell us how he is continuing to evolve his portfolio, but he’s doing it without adding any stress to his life. And he’ll even update for us a couple of his signature Dionisms for investing in 2026. I’d call these tips secrets to investing success, but Dion is giving them all away for free right here, right now. Let’s bring them on. Dion, welcome back to the show. Thanks for joining us.

Dion:
Super excited to get the invitation. I’m happy to come and see if there is a way to get more people on the path to financial freedom.

Dave:
Well, I think you’re going to do a very good job at that. You are always very compelling and have such a good perspective on real estate. But before we jump into that, can you please just tell everyone what you’re up to right now?

Dion:
I always like to start with the end, because if you tell everybody just about those first few years, you might scare them away from this. But the end result is what makes it worth going through the five years of suck is I’m currently in Thailand. I’ll be here for the winter, probably a little over three months. And the best part of this trip isn’t that it’s warm or that the scuba diving is amazing or that the dollar goes farther here. It’s that I don’t currently have a return home ticket.

Dave:
Oh my God, that is unbelievable. I’m extremely jealous, but you have obviously earned it. But I wanted to bring this up because I think it’s important for everyone to remember exactly what you said, that real estate investing, it’s not complicated, but it takes effort.You’re going to have to put work into it and there are going to be some frustrating days for sure. But there is a light at the end of the tunnel. And Dion, you have figured out financial freedom in a way better than me, man. I got to say. I’m sitting here in Washington State. It’s been raining for five days. My heat went out this morning. I’m shivering and you just look comfy as can be and calm and happy. So good for you.

Dion:
No, here I have to have the jacket on because of the air conditioning, not because of the weather.

Dave:
Now you’re just rubbing it in. Let’s go back to the beginning. For those of you, Dion’s been on the show before, great episodes we’ll link to below. But for those of the people who haven’t listened to your episodes yet, Dion, maybe you could just fill everyone in about how you got started, what year that was, and just give us some

Dion:
Background. Now everybody will understand why I wanted to start with the end first, but my starting position was I basically made it to 40 without ever having $1,000 in the bank. And if I ever did, I spent it faster than I could think and then never on anything productive. I found myself a single parent with three kids, got laid off from law enforcement because of the 2008 recession when there’s the municipalities aren’t making money. They lay off cops to save money. And I found a job teaching at a truck driving school making $17 an hour. But in the divorce, I found out about $89,000 in bad debt in my name I didn’t know existed until the divorce. So my starting position was broke, low income, three kids. And I decided to make my own pension because first I tried the Marine Corps and they downsized after desert storm.
Then I tried law enforcement and they downsized after 2008 and I thought, oh, my pensions keep going away. I have no control. How can I make my own? And starting at 40, it really wasn’t even the idea of retiring early. I loved my job at the CDL school. I got demoted all the way down eventually to president of the company and loved what I was doing there. I used to say, “I don’t think I’ll retire early. I’m probably not going to retire late. I love the job so much.”
My goal when investing was I didn’t want to become a financial burden to my kids if I ever got too old to work. That was the starting point. And then the income snowball kicked in around year five and maybe year six. The cashflow got much more than I expected. The self-management got a lot easier than I expected. And in 2022, I finally just said, “Time freedom wins. I love the job, but I’d rather travel and scuba and enjoy my 50s instead of continue to build someone else’s dream. I’m just going to live my own.”

Dave:
That’s an incredible story. I won’t spoil it for you because we will link to Dion’s full episode and you can really hear about it. But it really is inspiring, Dion, because I mean, I don’t mean to be disparaging, but it just shows that anyone can do it. You were starting with what? You said negative $86,000, not even at the starting line when you first got started, and yet still you are here. How many years later is that?

Dion:
Well, it took eight years to reach basically financial independence where I could have retired,
But then I did four years, so it was 12 years total. So that eight to 12 that you named is basically perfect for my situation. I could have retired anytime between eight and 12 years, but I loved my job, so I wasn’t in a hurry to leave. And I did a four-year litmus test where from year eight to year 12, I didn’t touch one penny from my W-2 income. That was always rolled into investing. Wow. So for those years, I lived off rental income and I continued to save and invest most of the rental income. I live on a round, even when I’m traveling like this in Thailand, I’m going to struggle to spend five grand this month. A round trip ticket’s 800 bucks. The five star hotels are 60 or $70 a day. It’s crazy. Food’s super cheap. So even at home or here because I still house hack, I don’t spend that much.
But my passive cashflow coming in after every expense and after setting aside about 60 grand a year for future expenses, those roofs and things that are going to happen and down the road, I make about $21,000 off of eight properties with 18 rental units. So I’m still going to continue to add properties, but I’m not actively growing. It’s just going to happen as a byproduct. And the goal was never a bigger portfolio. The goal was the right amount of cash flow from the least amount of units. And that’s where I find myself now after a decade basically.

Dave:
Are all those units paid off or how are they generating so much cash flow?

Dion:
It’s one of my favorite questions. I actually make a video every now and then on why so much cashflow? And part of it is I recycled cash flow, not capital. So I’ve never taken out a home equity line of credit, never done a cash out refinance. I’ve not sold a property for a 1031. I might sell my first property in 2026. So it’s save a down payment, buy a property. I’m the creator of the binder strategy where my tenants ask me to raise the rent. That helps a lot. To reach financial freedom, I never did a rehab or a BRRR. I did my first Burr after retiring, and I also call it my last Burr. I’m not going to do that again. It’s too much work, even though it generated about $300,000 in profit, not doing it. But I buy duplexes. All my properties are small multifamily, except for the one single family house I owned before I was an investor.
But I look for places that have a family room, a dent or a bonus room. This is something I learned from bigger pockets. How can you create more income from the same property? And I never bought a property and kicked a tenant out, but when I had tenant turnover, then I would go to the family room or the dent and add a closet. Now I have a three bedroom each side instead of a two bedroom and the rent increases over $1,000 a month with that extra bedroom and then the tenant turnover. And then the missing element that most people have is time. If I say I have eight properties with 18 units and it makes 21,000 a month in profit, they would think if they went and bought eight properties, that’s where they would be and that’s not it.
I bought one, owned it for a decade. I bought another two years later, owned it for eight years. I bought another a year and a half later, had it for almost seven years. It’s owning a property for several years, having possibility for rent increases, value add, refinance. As I saved more reserves, I could increase the deductible on my insurance and bring the premiums down to increase income. So it’s a combination of multiple levers that you don’t have in the beginning. It’s once you have three or four properties and you start making an adjustment like a three or $400 a month rent increase from the binder strategy on one property is nice. But on seven, it’s thousands a month.

Dave:
And compounded over five years every year. I think that’s a great point because I bet when people hear eight to 10 years, they think that’s all because it takes time for acquisition or it takes time to save up money to buy that next deal, which does take time. But the benefits of real estate really do increase over time. That’s why it’s a long-term game because your rents will increase, your debt is hopefully fixed and is staying the same amount. You get better at management, so your margins start to grow and all the things Dion just mentioned. Even if you had all the money to go out and buy eight to 10 properties like Dion said right now today, you still wouldn’t have the performance that Dion has a couple years into his portfolio because of the things he just said and gaining new experience.

Dion:
We did an episode in February of 2025 on things I do backwards or these things that I call Dionisms, right? There’s one here, and I’m just going to ask the question, how many times in the real estate investing community have we heard the growth phase and the stabilization phase? It’s very common to hear those talked about as phases. Of course, yeah. Okay. Well, the growth phase includes stabilization on the properties that you own. So when you buy a property, it’s not like you just kind of ignore it while you add other ones. That’s the one you’re looking for when you have tenant turnover, what value add can you do? Can you add a fence to split up the backyards of a duplex? Can you do the closet thing? Can you add a storage shed for increased income? So you’re stabilizing and optimizing along the way.
So it’s not like once you reach financial freedom or the perfect size portfolio, now you focus on doing that. You do that the whole time.

Dave:
And that’s how you get to hang out in Thailand because you’re already optimized by the time you get all those deals. You have it all figured out. So tell me a little bit about your plan going forward, because you said you’re not necessarily in growth mode. So how do you decide at this point in your investing career whether you’re going to acquire new properties or do something else?

Dion:
Well, there’s two things that tell me when to buy property. And there’s some things that people say that tell me they’re never going to be an investor. If they say, “I’m going to wait for prices to come down or I’m going to wait for interest rates to come down.” If they’re waiting for prices to come down and they won’t buy in an upmarket, fear isn’t going to let them buy in a down market. And if they want to wait for interest rates to come down, that happens the same day prices go up because people buy based on payment, they can pay more. But the two things that tell me when to buy is, am I ready? Which a lot of people associate with math. They’re going to think, do I have the reserves? Do I have the down payment? But am I ready as have I studied my market?
Do I know my asset class? And is there nothing major going on in my life like birth, death, divorce, traveling to Thailand, proposing at the Tiger Kingdom? I actually have that short video out, so I’m now traveling with a fiance.

Dave:
Oh, congratulations. That’s so cool. Well,

Dion:
Thank you.

Dave:
That’s so exciting. Well,

Dion:
Now in retirement, I basically wait. I’m ready means the money’s piled up. So if I’m spending, if I try 5,000 a month, I have over 15,000 a month that’s going into an account that slowly accrues a couple hundred thousand dollars every year or two. And I’ll think, okay, I’m uncomfortable with that amount of money sitting in the bank. I don’t like that. Inflation is the enemy when it’s in the bank and it’s your best friend when it’s in a property. And then so in 2026, I’ll be adding another property because the money’s piled up. And so I’ll probably spend 90 days, even though I know my market, I know my asset class, I’m going to take 90 days to study current rents, current deals, current valuations, watch deals, and then I’ll be making offers and buy a deal. And then I’ll take another year or two off because I’m not an active real estate investor.
It’s just the best use of my money at this point.

Dave:
Tell me a little bit about the market conditions because you said it sounds like you don’t look at prices to come down. You’re not looking for interest rates to change. How do you view a market in 2026 and not be scared of it and say, “I’m not going to invest, but learn something about it so that you can choose the right kind of deal for you going forward.”

Dion:
So I’m never concerned about a crash coming. Interest rates or prices don’t impact how I invest. It’s, am I ready? Did I find a great deal? And the definition of a great deal for me is 5% math, 95% criteria.
So the math is important. We don’t practice the math until we get it right. This is right from bigger pockets. We practice the math until we can’t get it wrong. Then we stop focusing on math. So I’m looking for, even with setting aside for repairs, maintenance and vacancy, I don’t want to lose money, so no alligators. I want to make profit. I shoot for a return that’s better than my average area. That’s why I want to take 90 days before I buy. I want to figure out is currently in my market and sometimes markets shift. In 2021 and 2023, I bought deals because remote work had changed the landscape. Remote workers can live a little farther out from the bigger cities, which pushed rents up, but not prices because they weren’t buying. They were afraid they might get called back to the office. So I thought if friends have pushed up and prices haven’t, which deals make the most sense and I got the yield I was looking for.
But that’s the math. The criteria is I’m a long-term buy and hold investor. I want the minimum amount of interaction with tenants, keep them happy so I can travel. I’m not doing short-term, mid-term, and I don’t want tenant turnover even though it sometimes gets the best rent increase.
And that means I want to own single family houses. They have the longest tenant turnover. It’s like the average tenancy in a house is seven years. The average tenancy and apartment is two years. But single family houses in my market, they’ve never cash flowed in a decade. I’ve never seen one. The one I own only works because I owned it for a decade before I turned it into a rental.
And I even lost money the first year. So I want small multifamily because they have the yield I’m looking for with this caveat as similar to a single family house as possible. So I want side by side with fence yards, washer, dryer, hookup, separate parking, decent neighborhood. I avoid good school districts. We’ve talked about that before because most people priororitize that. I don’t want the tenant turnover or the higher taxes that comes with being in a good school district. So I’ve got all of this criteria. So in 2026, at some point when I’m ready, I’m going to study the market for about 60 to 90 days to understand what current rents and current prices and rates. What is the average yield? I’ll look for deals that beat that, but then I’m going to focus most of my time on side-by-side fence jards, washer-dryer hookups, safe neighborhood, all of the other criteria that lets me be financially free with the minimum amount of time involved with my rentals.
The rental you hunt for dictates what your life will be in 10 years.

Dave:
So let me just make sure I understand and summarize this because I think this is very, very smart. And I agree, especially in this kind of market conditions. For me, I’m just like, how do I find the best asset that I want to hold for 20 years? That’s my number one thing that I think about. But does it mean then that you create that buy box, right? Let’s just say you work with an agent, you go on Zillow, you set those criteria, and then you analyze deals for 90 days, basically everything that meets that criteria for 90 days. And then you say, “Hey, I found the needle in the haystack.” Now because I’ve analyzed so many of these deals, I know what average is. I want to beat average and by benchmarking myself against all of these other listings, now I can be confident that I’m going to beat average.

Dion:
When I first started, I would say take 90 days to learn your market minimum. When I was in growth mode, I never had to take 90 days because I was always actively tracking rents and tracking prices and rates. And it was, like I said, life consuming those first five years,
It took way more time. In retirement, since it’s just when the money piles up, I’m not going to go every two years and go buy a property. It’s every two years. I will now learn my market because everything changes. You have seasonality, what time of the year am I buying, what’s happened with remote work or the economy or universal basic income that might come if AI takes too many jobs or anything that could shift in the future that will benefit landlords. I want to make sure I’m optimizing how I’m buying based on what’s going on at that time.

Dave:
The way deals look today versus 10 years ago, interesting history lesson does not matter. It just doesn’t matter because your job as the investor, you had mentioned it earlier, Dion, what’s the best use of your time and money today? If it’s real estate, do it. If you think there’s something else you can do with your time and money, fine, go do that. But what happened 10 years ago? Totally irrelevant. You can’t go back and do deals that looked like that. So I love your advice of relearning your market because that’s the process for saying, “Hey, I’ve got some cash to spend right now. I have this goal that I’m working towards. How can I execute on that as best as possible with the conditions that are realistic on the ground and not thinking about, hey, could I have done a short-term rental five years ago?” Who knows?
But it’s honestly irrelevant. Maybe short-term rentals work today, maybe something else works today, but that’s the question you need to be asking yourself. So Dion, I do want to get your advice because you are a very wise man. You have a lot of good advice for people, especially who are getting started. I want to hear your advice for people getting started in 2026 or maybe just getting back into the market after a few years off in 2026, but we do got to take a quick break. We’ll be right back. As a real estate investor, the last thing I want to do or have time for is play accountant, banker, and debt collector all at once. But that’s what I was doing every weekend, flipping between a bunch of apps, bank statements and receipts, trying to sort it all out by property and figure out who’s late on rent.
Then I found Baseline and it takes all of that off my plate. It’s BiggerPockets official banking platform that automatically sorts my transactions, matches receipts, and collects rents for every property. My tax prep is done and my weekends are mine again. Plus, I’m saving a ton of money on banking fees and apps that I don’t even need anymore. Get $100 bonus when you sign up today at baselane.com/bp. BiggerPockets Pro members also get a free upgrade to Baselane Smart, which is awesome because it’s packed with advanced automations and features to save you even more time. So go to baselane.com/bp. Welcome back to the BiggerPockets podcast. I’m here with Dion McNeely talking about the 2026 market. We’ve talked about Dion’s philosophy, how he spends a lot of time relearning his market every couple of years when he’s going to buy a new deal. So Dion, for people who are doing this, getting back into the market, or maybe they’re just buying their first deal ever, what advice do you have for people who are just trying to get into it right now?

Dion:
The first thing to consider would be imagine the cost of waiting. When I hear the people that say it must be nice to have invested five or 10 years ago, whatever the market conditions are, whether they think it was a pandemic or the recovery from the crash that made that more attractive, there will be a point in time, picture 2035 when people are saying, “You are so lucky because you bought in 2025. At BPCON 2025 in Las Vegas, look how many lenders were there looking for people to give money to.
” In 2035, that might not be the case. Lending might disappear like it did in 2012, 13, 14, when all of a sudden you can only have four conventional loans in your own name instead of 10 like we have now or whatever benefit we have now. So the advice to somebody starting today first to steal your words, it’s a 10-year journey. Don’t expect the first deal to be life-changing. Don’t expect the first few years to be fun. They’re going to be very slow. They’re going to be very boring. The expectation is from year one to year 10 that the cashflow grows like a diagonal and really it is almost flat line. I don’t think I broke $1,000 a month in cashflow for four years,
And then it still stayed pretty low until year eight and maybe eight and a half. It hockey stick growth kicked in, and that happens way later when you have multiple levers to pull. And this gets talked about often, but if somebody’s starting today, it was a requirement for me. It might not be a requirement for everyone else, but I suggest some form of house hacking. I’m not saying go add roommates. I like duplex, triplex, fourplex, but if that turns peoples off because of their spouse or their kids, I had three kids too. They were excited about moving, but a house with an ADU. And when I say that, most people think a house with a small house behind it because that’s what we can build today. It’s got to be behind the other unless you get a waiver. It’s only so many square feet. Derek, that ADU guy who you guys have had on the channel, he just builds ADUs.
What I did is look for houses with ADUs from before all of the laws and regulations. So I own a house with an ADU, which is a 2,500 square foot house and a duplex on one property. Somehow that’s an ADU situation. They’re not attached, they’re separate, but it’s one property, house with ADU. I’m not actually sure which building is the ADU. I was looking at another one that was a five bedroom house and a four bedroom house on one property. They just hadn’t divided it. And so the people who say they can’t start with a house hack because they have family, do they somehow magically live somewhere now where they have no neighbors because that’s how house hacking can be done.

Dave:
I know. I think for most people who have experienced some sort of city or even suburban living, it’s really not that big of a difference to your lifestyle.

Dion:
The second thing is the steps are the same to start or for me between deals eight and nine or whatever, it’s you’re saving. How do you increase your income and decrease your expenses? Saving isn’t just about spending less, it’s about increasing your income. So for me, that’s staying on top of what goes on with my rents, how do I do value ads? How do I mitigate my expenses, increase my deductible to decrease my premiums or whatever the strategy is. In growth mode, it was overtime, side hustle. I was playing World of Warcraft and selling things online as a side hustle, making hundreds of dollars a month, playing games with my kids to increase the savings rate, but then decrease the expenses. In growth mode, it was no streaming services, not eating out. I went eight years without a vacation so that the rest of my life can be a vacation.
So if you’re starting, what can you eliminate without making life unbearable? Maybe don’t eliminate all streaming services, but they’re really good at having one show you like on Netflix, one series on Hulu and the movie on HBO. So you got to have to have all of them. But if you can cut that back and you cut out the eating out meal, prep, less vacations, maybe not none like we did, then what is your credit score?
The steps are the same. You’re increasing your income and decreasing your expenses, work on your credit score, and then actually go talk with a lender. And the first three steps here, there’s no agent involved. There’s no auto searches, there’s no deal hunting, no funnels because you have to get all of this right. First. If you talk to an agent, one of their first questions, if they’re good, should be, “What did your lender say?” Because why look at anything until we know what you are able to do? Totally

Dave:
Agree.

Dion:
And I guarantee right now there’s some agent listening, going, nodding their head going, “Yes, please do that. Please talk to a lender to understand your options.” And I would never have gotten started if I had talked to agents first. They would’ve said, “Well, you hunt for a property or go talk to a lender.” And then I talked to a lender and the lender said, “You can’t borrow anything.”
My debt to income was so bad. The agents wouldn’t have understand usually to say, “Well, rent your house out for a couple of years, get rental income on your tax returns, and now your debt to income means almost nothing because we’ll look at the rental income on the property you’re purchasing.” And one conversation, the lender accidentally, she just kind of threw it into the conversation. I grabbed onto that and I thought, wait, that’s a thing and that changed everything for me. Once you talk to a lender and you know your steps, now it’s study your market to pick a strategy. So I worked in law enforcement for about eight years, and one thing a cop can’t do is you can’t show up on scene and go, “I think this happened. Let me find evidence to back it up.”
You have to show up on scene and go, “Let me look at the evidence and based on the evidence, here’s what I think happened.” And then as I’m studying it, as more evidence comes in, I will change my opinion based on that evidence. So market’s the same way. I looked at my market, I wanted to own single family houses, I understood them, I could house act them, I could buy it without having roommates or anything and then move out and rent it out, but they don’t cash flow in my market. So studying my market shifted me to small multifamily. I have a friend, she sold her stuff in Washington, 1031 to Ohio. And where she invested, single family houses made more sense than small multifamily. So you have to study the market to figure out what works, where you’re investing, what matches your resources, your abilities, and what matches your strategy.
And then after you’ve done all of that, that’s where the agent comes in. Your strategy could be driving for dollars, setting up mailers, working with wholesalers. Mine was working full-time, raising three kids. I had agents sending me emails and I filtered through those looking for the ones that I wanted. Kindergarten simple, wasn’t in a hurry. It took two years to buy the first duplex, two years to buy the next one. So in four years I did two whole deals, but that’s how you get to financial freedom is having a repeatable process. The work is not so much that you’re actually going to be able to do it.

Dave:
All right. That is great advice for beginners and people who are starting to get started, but I want to hear some of your best tips for managing and optimizing your portfolio next year because this is sort of your thing, Diana. I’d love to get your insights on it. If you had to pick two or three of your top pieces of advice for people who want to optimize their portfolio in the coming year, what would those things be?

Dion:
Well, thank you very much for the compliment. It’s very weird to have that because I am a product of bigger pockets. My starting position was so bad. I lost money that first year. I rented out the house. I didn’t see myself as a real landlord, so I rented to a friend because I couldn’t trust a stranger and I didn’t want the contract between friends. So we didn’t have a lease. And it was just every nightmare mistake I could make I was making. So I realized I was the problem. Landlording is not complicated. It’s simple. It’s not easy, but I was the problem because I was uneducated, 13 week bootcamp to become a Marine six-month academy to become a cop, and I’m just going to jump into real estate with no education and replace my income. So I started hunting for Rich Dad, Poor Dad, podcast.
At the time, BiggerPockets YouTube channel wasn’t very big, but I found the website. And there was guys like Michael Zuber from One Rental at a time who were writing on the website. So some article talked about how small multifamily lending was the same as single family, and that made a shift for me. And how do you find a lease and how do you screen tenants and all of the really basic stuff that I just was winging it. And because I found BiggerPockets in written form, that’s the dinosaur days, I’m financially free. So I want to thank you for the compliment, but thank you for the content that is helping people get here.

Dave:
I mean, you deserve all of it, man. I appreciate that. And BiggerPockets is really that resource and we love hearing that. And for anyone who hasn’t been on our website, it’s honestly crazy. A lot of people think we’re just a podcast. We have an amazing website. Go to biggerpockets.com. We have all of this free content, networking, the forums, these ways that you could have your answers questioned. It’s an incredible experience. We love that. But BiggerPockets is just like anything else where it’s like, it is what you make it. You have to go out and work hard and figure out your own flavor of how you’re going to be an investor. Because even though thousands, tens of thousands of BiggerPockets members have done this before, no two people are exactly alike. And I just want to, I think your story’s so cool because you’ve really come up with your own way of doing it.
And it’s based in fundamentals. It’s not like you’re completely just starting from scratch, but you have come up with a really unique and sometimes contrarian way of looking at problems as a real estate investor. And I don’t say this lightly. I don’t think there are all that many true thought leaders in our space where people are coming up with new ideas, but I think you’ve absolutely done that. So I think the praise is light compared to what you are deserving of. So we are very grateful of you continuing to be a member of the broader BiggerPockets community here, Dion. With that, I want people to hear this because you are a though leader. You have some really cool ideas about real estate investing. Give us your three top ones for how you recommend managing and sort of optimizing.

Dion:
So this is going to be a teachable moment that I take away from McDonald’s. We would all have to admit fairly successful business model. And if
People are familiar with Robert Kiyosaki, they know that McDonald’s is not in the hamburger business, they are in the real estate business. But in the 1990s, early 1990s, McDonald’s started broadening their menu. They said, “We have the chicken this, we have a salad that we have all of these different options.” And their profits tanked. Other people were able to duplicate it easier because they were smaller businesses. It was easier to implement. And in the mid ’90s when McDonald’s realized they had diversified their menu so much they were losing clients, they came out with their jingle about the Big Mac and they focused back on that hamburger that is the iconic thing of McDonald’s does Successful to this day. So in real estate, we tend to do the same thing. I wanted to buy long-term buy and hold rentals. So you fall down into the rabbit hole of how do I educate myself on this and what do you hear?
Burr, flipping, wholesaling, investing at a distance, short-term rental, midterm rental, all of these things that you can try. You’ll diversify your menu so much that you’ll spread yourself so thin. It’s like investing in real estate and stocks and crypto that you won’t master an asset class
Well enough to be successful at it. Well, in your asset class, pick the strategy that matches your resources, your timeline, and your goals, and try to focus on your hamburger. Mine is, even in retirement, because I save up money and I could easily do burrs. I could self-fund burrs. I’m not going to. I like to travel. I don’t like to do rehabs. I don’t like to pull permits. I hate going to the city and begging for permission to improve my property. Me too. That’s not me. There’s people who love that. If you thrive on that and the negotiation with the city and the contractors, go for it. That’s your hamburger. So that’s the first advice, is really focus in on what you can master so that you can get to the point where it’s boring. That’s where success comes from. It doesn’t come from the excitement of learning new things when you’ve been doing the same thing for 10 years.
Get that mastered.

Dave:
This is probably one of the more common questions I get is people say, “Hey, I’ve done two burrs, I’ve done a flip, I’ve done a single family out. What do I do next? Or where should I go from here?” And I usually ask, “Do you have to change? Is there a reason other than social media or the shiny object syndrome that you would do that? ” Because maybe if your stuff’s not working, you should go do something different. But why do you think it is so much in this industry that people have this tendency to want to just move on, try something either bigger or not even necessarily bigger, but just different from the kinds of deals they’ve done in the past?

Dion:
It is a part of the brain that we can’t remove. When I was reaching financial freedom, I have this friend who was also reaching financial freedom the same year, and he retired the same year that I did, but he has shiny object syndrome. Every time he would reach out to me for advice, he would say, “What do you think of RV pads? What do you think of buy the room? What do you think of short-term rentals?” And I would have to reel him back into what we’re doing is working. It’s very boring. I understand you don’t have excitement with what we’re doing, but if you repeat it one or two more times, let’s run the numbers again. And then he ended up sticking with it with his nice boring strategy and he’s been retired now for three years as well. And I have that conversation a lot of times with newer investors or people that I run into is they go, “How can I do what you did but faster?
Or how can I do what you did if I use a different strategy?”

Speaker 3:
And

Dion:
My strategy’s very boring. It’s one property, save a down payment, buy the property, keep a tenant long-term. I prefer to buy rent ready or already occupied properties. I’m all I can to buy and spend a bunch of time fixing it up. That’s very boring. But financial freedom after a decade is anything but boring.

Dave:
I love that. Yeah, I think that’s kind of the whole thing is just keeping your eye on the prize and realizing that your excitement doesn’t have to come from real estate. You can have your excitement come from anywhere else. There are some people, like my friend who’s on the show a lot, James Dinard, he loves flipping houses. He would do it for free if no one … I’m just the opposite of that. I like real estate. I find it enjoying. I like the problem solving, but I like the sort of big picture. Hey, I’m doing this because I know the other stuff it achieves for me in my life. I am not in it because I have this love of physical dwellings the same way that someone like James Dainer does. So I think it’s just really important for people, one, to have that long-term perspective.
And two, recognize what side of that line you’re on. There’s no right or wrong. If you’re someone who’s passionate about it, by all means, go be passionate about doing the kinds of value add. I know a lot of people who are contractors or architects or engineers who love building. That’s super cool. Go do that. If you’re lazy like me and Dion, maybe just do the more boring approach because that could work for you too and you can find that passion with the free time that you generate from your real estate investing. We got to take a quick break. We’ll be right back. Welcome back to the BiggerPockets Podcast here with investor Dion McNeely, talking about his very unique, memorable, I think super inspiring and relatable approach to real estate investing. So I love that as number one. You got to find your hamburger. What’s number two?

Dion:
So I think a smart person learns from their mistakes and a genius learns from other people’s mistakes. But the second piece of advice is, and this is kind of like a thing the way I put it in my head is amateurs chase deals, professionals chase repeatability. While I was starting, I was working full-time, raising three kids, didn’t have a lot of free time. Deals would be creative financing, seller financing, the Burr method so I could recycle my capital faster to get more deals faster. But when you don’t have a lot of time, well, that strategy is repeatable for some people, it wouldn’t be repeatable for me. So it was save a down payment, buy a property. Two years to keep studying the market, save the down payment, increase income, decrease expenses, and then two years again, sounds super boring, but it was repeatable to the point where more units didn’t mean more work.
I can manage my 17 rented out units because it basically feels exactly the same as when I had seven or 10. I don’t notice the difference. Two or three techs a month, maybe one email. I have my systems in place that well. In the beginning, that wasn’t the case. So getting my systems in place was more valuable to me than adding properties. And in the beginning, what is everybody focusing on? How do I get the next deal? It’s once you have the deal, how do I get my system? So how do I have a list of contractors for plumbing and electricity? So when I have an emergency, I have no stress because I’ve already got their phone numbers in my phone. Do I have a contact in my phone for every property so I know what tenants are there, when their leases are due, what their current rents are, what jobs have in my notes section, in my contacts, in my phone for every property, there is what’s been done there and when it was done and when I expect certain maintenance to happen.
All of these systems that make it very easy to travel, the entire business can be in a device. You don’t have to have anything, no spreadsheets or anything. You can have them, but you don’t have to have them to travel. So since my system is repeatable in growth mode, I didn’t even subconsciously resist adding units because it didn’t mean more time. And that’s very important to me in growth mode, especially because if it takes more work, your brain will say, “Oh, we’ve got enough. Don’t add any more. We can’t handle any more.”

Dave:
Yeah. I think this is one of the things that held me back the most as a real estate investor. I self-managed from 10 years. And if I had just figured out what you were just talking about, I would’ve probably doubled. I would add more properties because I wasn’t actually … I was lucky I had a high paying job and I could have bought more, but I just mentally never sat down to invest time upfront to clear time for myself later that would allow me to do that. And instead I was just like, “You know what? Real estate, I have another career. I’m not going to be working on my rental portfolio right now.” And I did that for years. And if I just recognized that I didn’t have a very good business at that point, I had good investments, but I didn’t have a good business or a good system or a good … The way you’ve put it, I couldn’t repeat stuff.
I was calling different plumbers every time. I was okay, but I could have done better and I could have grown faster. And it took me, God, way too long to figure that out, probably three or four years longer than it should have. And I missed out on probably scaling some of the stuff that I should have. And like you said, I don’t regret things because it all worked out in the end, the butterfly effect. But if I were to go back and could tweak some of the things, I think that’s the number one thing I would focus on more is systems early.

Dion:
And looking back, my systems weren’t there in the beginning either. My first few years were just like yours. It felt like it took 20 hours a week to manage my one tenant, let alone two hours a month to manage all of the tenants that I have now. So it was developing those systems over time, educating myself on bigger pockets, finding the people in the community to spend time around with to figure out how they do things. An example is the lumberjack landlord. For years, I would list my properties the wrong way when I had a rental. I would put them out there and I’ll get to the last piece of advice as quick because I can’t hear the … I would list a property the way an owner thinks. Here are the amenities. Here’s the age of the building. Here’s the square footage. Here’s the parking.
Here’s the distance maybe to the freeway. The Lumberjack landlord, he optimized my interacting with him, optimized my advertising my rental so much that I no longer hunt for a tenant. I have to filter through applications. And it’s by not talking about the property. The tenants don’t really care about the property as much as they care about the quality of life they’re going to have in the property. So take your address of your rental and put it in ChatGPT and say, “What are five to 10 things that my tenants might find attractive about the area that this rental is in? ” And it’ll pull up parks, it’ll pull up walking trails, dog parks, ChatGPT or Grock or whichever you use will tell you those things and have that in the listing, just bullet point. These are five things that could affect your quality of life if you lived in this area.
And now I get 30 to 50 applicants instead of five.

Dave:
Wow. I love that.

Dion:
Those are the systems. And the third thing that I hope people could take away, whether they’re just starting in real estate or they’ve been doing this for a while and they’re optimizing now, is ask yourself this question, what skill could you dedicate the time to mastering that will change the entire game for you? And for some of us, that’s deal hunting, deal analyzing. For some of us, it’s negotiation. It could be communication, it could be networking. There is a skill out there that you haven’t focused on that you could take the next couple of months and dedicate the time to that will impact the rest of your life as far as investing goes.

Dave:
I love this. Actually, in one of my books, I talk about this that there’s just no way you can feasibly learn every skill. There is just so many different things real estate investors need to do. Some of them, I’m sorry you’re going to be bad at. It’s such a broad, different type of thing. Some people are really analytical. Some people are great people person. Some people just love sales. There’s just so many different things. It’s really hard to be good at it. And the great thing about real estate investing is that you could specialize and trade people who are good at these other things. You can hire someone who’s handy if you’re not. You can work with a property manager. Deon’s a great property manager, but if that’s something that you’re not into, you could probably learn another skill and hire out being a property manager.
You don’t need to be good at everything to be a good investor. You need to be self-aware, I think, to know what you’re good at and what you could feasibly learn. And which things, like for me being handy, you should probably just quit because I’m never going to do maintenance on myself. I’ve tried that stuff and it never worked for me. It was a huge waste of time. I’m better at learning. For me, I think my skillsets are deal finding and deal analysis. That’s what I’m good at. Not a great property management, decent enough, but I trade for everything else. So Dan, what are some examples of these skills that … Well, what’s yours, first of all? What’s the thing you invested in and what are some of the skills you think are the best ROI for people to invest their time into?

Dion:
So the one skill that I’m not arrogant enough to say I’ve mastered, but I’ve focused on mastering is teaching. The highest form of learning is teaching. And when I look at every aspect of real estate investing or owning the property or managing the property, I think whenever I’m doing anything, talking with a tenant, doing the binder strategy or anything that involves a skill, networking, presenting, I think if I had to teach somebody how to do this, if I had to teach somebody how to screen tenants, how would I make the lesson outline?
How would I convey the information in at least three different audible, kinesthetic, whatever version they learn in? Doing that, it makes it sound when I talk like I’m super organized and I know what I’m doing. I’m not and I don’t. But when it comes to an aspect of real estate, if I’ve had to think, how would I teach this to somebody? I’m very organized and I know what I’m doing about that thing. And so that might not be everyone else’s thing they need to master about how to teach, but at least think if you had to explain what you’re doing to someone else, if you could articulate it, you’ll be better at doing it.

Dave:
Do you think it overlaps the things often if people are trying to figure out what skill they’re good at, is it always the thing that you love doing or have you found it’s also sometimes you’re just good at things that maybe you don’t like doing? I

Dion:
Think people benefit more from improving the things that they’re good at than working on the things that they’re terrible at. Like you said earlier, outsource the things you don’t like doing or you’re not good at doing. I had no idea until I started working at the CDL school that I liked teaching. I was a driver for years. I was an officer for eight years and I was in the Marines, but between that, I was a truck driver for over a decade. My first month at a CDL school as an instructor, I became 10 times the driver that I ever was.
I think I’ve translated that into real estate, but I have friends who aren’t teachers who are more successful than I am. And I mentioned them a couple times in this video, the lumberjack landlord, Millennial Mike and Michael Zuber, they’re not teachers. They worked in IT sales and they took skills from their job that they had to master for their work and they’ve used that in real estate. The lumberjack, self-managing over 1150 units while Burr’s and rehabs are going on, that is a project manager thing. That’s his skillset. That’s not me. I’m not the project manager. I didn’t like doing one bird, but he’s doing three or four at a time sometimes. And so everyone listening or watching, what are you doing for work that has required you to master certain skills?
Will those skills translate to investing? You might already have a type of superpower. And for me, I think it’s putting myself in the shoes of who I’m talking to. So it’s sometimes teaching, but sometimes the binder strategy comes from why are my tenants so stressed out about rent increases or thinking they’re going to get kicked out? How can I alleviate that? Put myself in their shoes, came up with a system that made it a lot easier to get the rents up, keep tenants, low turnover, happier tenants. But I think almost every job out there has some transferable skill that people are already mastering that they can bring to real estate.

Dave:
That’s awesome. I absolutely agree with that. I’m just resonating this while you’re talking about it because I get a deal analysis. I was a data analyst before as a podcast host. I’ve been doing this for a lot of my career. It’s something I feel comfortable doing. I went into that career because I enjoy doing it. I know people think that’s crazy that you like looking at spreadsheets, but I do. So there’s something out there for everyone. And I’ll also say, I also think there’s sometimes, it could be even a hobby that you like, something that you’ve gravitated towards over your career, even if it’s not your vocation and you don’t like your job, there’s probably something that you’ve learned or dedicated, committed time to, whether it’s a sport or an instrument or something that you have to learn, patience or attention to detail. These are great things to do.
So before we get out of here though, Dion, other than your skillset, mine, which is more analytical, are there other skills that you think have really high ROIs for people?

Dion:
I think people underestimate the value of communication, whether it’s with your tenants, a contractor, most people will call it negotiation, but it really comes down to communication. And there’s a whole rabbit hole on YouTube of NLP or negotiations. Chris Voss was at BiggerPockets in 2025 and he talked about different negotiation tactics and you might not have to get so technical or so detailed, but if you can learn the difference between parroting, mirroring, memory anchoring, some really simple things that can make your communication easier, easier to gain someone’s trust, easier to either get what you want or at least understand why you didn’t in negotiation. I think communication, I hear some people often say, the most money to an employee goes to the sales department, and that’s because they can communicate. In real estate, the money goes to the people who can communicate. If you can keep your tenants happy or your property manager happy, or you can communicate with your contractors.
And an example is I communicate with my lenders. And when I give this example, it sounds like a ton of work, but it’s really four or five emails. I’ll go to a big bank and I’ll say, “What do I qualify for? ” And I’ll get it in writing. When I go under contract with the property, I’ll go to all the different types of lenders, credit union, mortgage brokers, use Matt, the mortgage guy or somebody like that, and I’ll say, “Here’s what the bank is offering. Can you beat it? ” In a communication style that says, “I’m offering you business, if you can beat their business, and then if they can beat it, I take it back to the bank and say, if you can match this, you can keep my business.” And so it’s a really simple communication skill seeing from their perspective that they want the business, I want to give them the business, but they have to give me the best deal.
A small communication skill like that has saved me tens or probably hundreds of thousands of dollars over the years with the best interest rate, the lowest amount to buy down the rate. And that’s just one aspect. When you add that to contractors and handymen and tenants and the tenant who wants their ESA pets in or the tenant who has a noise complaint with their tenant next door, if you can master or get better at communication, even if you have a property manager, so many people use the excuse of, “I don’t like conflict, so I’m going to have a property … You’re going to spend more time managing your property. You’d probably spend more time with the property manager than I spend managing my tenants because you have to verify everything or I just have to do

Dave:
Everything.”

Dion:
But that communication skill, it pays off in every aspect of investing.

Dave:
Yeah. The thing I’ve always loved about Chris Voss, I’ve been a fan of his forever. And we were both at BPCon talking about it is the stuff he’s teaching, people hear this word negotiation and they think it’s like manipulation, but it’s not. The way I think of it at least is just emotional intelligence. You’re learning how to create mutual benefit to people, explaining to people what you need, what works for you, learning from them what’s important to them and trying to find an agreeable solution for both of you. I self-managed properties for 10 years. I now have property managers, knock on wood, I’ve never had to evict someone. I’ve always just been able to have conversations with people and work it out. And you still have to convey where your lines are as a property owner, where your lines are as a property manager. But if you’re good at this, you can figure out the right ways to build your business in a really mutually beneficial way.
You’re not negotiating trying to manipulate your bank, right? You’re just trying to find a loan product that works for both of you. And if you take that kind of approach to every relationship that you have in real estate investing, I totally agree with Dion. You are going to be better off in your entire portfolio if you learn that one skill.That’s a very good high ROI piece of advice there, Dion. Not surprised though. You are full of high ROI pieces of advice. So thank you so much for joining us here today, Dion. This was a lot of fun.

Dion:
I appreciate it. I appreciate the opportunity to come on here anytime that I can. I really loved coming to BiggerPockets in Las Vegas, and we have this one coming up next year. I hope people get surrounded by people who are doing what they want to do because then you’re more likely to do it yourself.

Dave:
Absolutely. That’s what the BiggerPockets community is all about. So check out our website. There’s literally hundreds of thousands, millions of members who are there helping one another succeed in real estate investing. Check out all the live events that we’re doing over the next couple of years. Get into the same room as real estate investors. It is going to help you more than you can possibly know. On top of that, if you want to learn more from Dion, you can check out his YouTube channel at Dion Talks Financial Freedom, where he’s always giving out great advice. Thanks again, Dion.

Dion:
Thank you so much.

Dave:
And thank you all so much for listening to this episode of the BiggerPockets Podcast. I’m Dave Meyer. We’ll see you next time.

 

Ashley:
Our guest today built herself up to seven figures in annual income, but one night in her living room, she broke down crying, realizing success had trapped her instead of freeing her. From six figure commissions to dog sitting for survival, today’s guest took some fearless swings that completely changed her family’s life. And today we might find out that chasing more money isn’t always the answer. This is The Real Estate Rookie Podcast. I’m Ashley Kehr.

Tony:
And I’m Tony J. Robinson. And with that, let’s give a big warm welcome to Casey. Casey, thanks so much for joining us today.

Casey:
Thanks for having me.

Ashley:
Now, Casey, you and your husband were making over $1 million a year. I think everyone’s first question is how?

Casey:
Well, I am still, but we were living in the Bay Area, Silicon Valley to be exact. We’re very close to Apple, Google and all. And my husband is an engineer. I’m myself a real estate agent. And as you know, in the Bay Area in San Jose, a home could easily cost 1.5 to $2 million. And I was one of the top producer. So I probably bring in … The minimum would be 50,000. And the max, I believe I made $170,000 a month.

Ashley:
Yeah. Wow. That’s incredible.

Casey:
But I work twenty four seven.

Tony:
Yeah. Well, that’s what I was going to ask Casey. I mean, because there’s a lot of folks in our audience who either are currently agents, but maybe even more so who are thinking about maybe transitioning to be an agent as they get into the world of real estate investing. What do you think it was, aside from being in a market that’s maybe more expensive, because there are plenty of agents in the Bay Area who are not making nearly as much as you. What do you think you did differently that allowed you to really achieve that level of financial success?

Casey:
I honestly think it’s mindset. Your mind is really powerful. You can do whatever you want to do if you can actually think about it first in your mind. So before I started real estate, it was difficult. The first year I made nothing, zero. And so I told my husband, something got to change. I hire a coach and I start to get into the room with people that was doing better than me, masterminding. And that’s how I get to the production that I was doing before.

Ashley:
So you’ve done everything that most rookies are chasing. You’ve got thing come, you’ve got the homes, travel. What signs did you miss that told you this actually wasn’t sustainable?

Casey:
I think I was working twenty four seven. And I remember COVID time because we were living in a condo. It was our start of home. It’s like a thousand square foot. And we have a designer come to kind of redesign a condo so that it’d make it livable during COVID. So she turned our living room into our office. So my husband’s desk and my dad was facing one another. And I remember it was 10:30 PM at night. I was fully closed. He was actually in the meeting. I actually just got out of the meeting and I looked at him and I said, “This is terrible. This is not the life I want to live. We have a lot of money and we don’t even have time to spend it. ” And it’s funny because my husband and I have been together for 13 years. When we first got together, we had $4,000 in the bank come by and we were so happy and we were traveling to Hawaii, we were traveling to Vietnam.
So it’s pretty interesting that the more money you have, it doesn’t really bring you more happiness. You just have a lot of responsibility and a new sets of problems, I would say.

Ashley:
I was just going to look up, what’s that one song? It’s by a country singer, but money can’t buy you happiness, but it can buy you a boat.

Tony:
I haven’t heard that one before. Of course you haven’t,

Speaker 4:
Tony.

Tony:
Or there’s the other saying it’s like money won’t buy me happiness, but it’s okay. I’ll cry in my Ferrari. I’ve heard that one. But for you, Casey, I mean, would you say that you were burned out?

Casey:
Completely. Yeah, 100%. And I think I didn’t have a direction because I was working nine to five and obviously everything on social media or people always say, “Quit United Five so that you can be an entrepreneur and have your own schedule.” But then I went from nine to five to twenty

Ashley:
Four seven. So when you had this realization of like, “I don’t want to do this. I’m not happy. We have enough money.” What were the first steps that you took? Did you take action the next day to change your life or what did that progression kind of look like where you made this shift?

Casey:
Pretty much immediately. So I’m the type of person that when I set my mind onto something, I would do it right away. And I really don’t care what you say or if you tell me that I’m going to fail, I just really listen to my gut. So I wanted to invest in real estate with all these extra money that we have because I honestly don’t know anything about stock and my husband invests our money in stock, but the return, he showed me the return every year and it’s really sad.

Tony:
I just want to add to that too, Casey, because a lot of people talk about the stock market. It averages whatever, eight to 12% over the last 50 years. And again, someone go validate this because I haven’t done my homework on this, but it’s something that was just interesting. But he was like, even though the average stock market return is between eight and 12%, it’s never actually hit that number in a single year. It’s either crazy crushing it or really, really bad. And those extremes just kind of average out to that eight to 12%. So even when folks talk about investing in the stock market, it’s not this steady kind of upward climb. It really is kind of jagged up and down that you’ve got to really zoom out over the long term to see those returns average out.

Casey:
100%. And I think I’m just really impatient because you hear about compound interest, so you have to leave it for like 20, 30, I don’t know, until you did to see the return. And I’m just not like, I got to see it now.

Tony:
Now, during your journey, Casey, I know you unfortunately experienced a miscarriage and you mentioned that as really a turning point for you, especially with all these other feelings you were having about being burned out. How did that loss change really what mattered to you about work and about wealth?

Casey:
I’m sorry, I’m just a little emotional.

Tony:
No, it’s okay. Take your time.

Casey:
So my son is actually almost one and a half downstairs playing with my mom. And so I was working a lot. We were trying to have a baby and I think it would just stress. So I lost the baby and I’m the type of agent where I do everything for my clients. I go out of my way to take care of my clients and my friends. So when I had a miscarriage, it was just really lonely because I was just pretty much just alone. And I was thinking, I don’t know what is the point of doing all of these to make sure everybody happy, everybody healthy and taken care of, but I can’t even take care of myself.
And so that’s really the turning point for me to change a lifestyle and actually move out of the Bay Area. And I’m so glad that we did. So now we live in Lexington, Kentucky. And I know Tony, you live in Los Angeles area and people in California just live in their little bubble. I used to be, live in my little bubble that we have the best weather, best food, diversity, blah, blah, blah, blah, blah. And everywhere else in the world or everywhere else in the US are just bad, bad weather. But Lexington, Kentucky is very beautiful. People are so nice and we’re very, very happy.

Ashley:
I appreciate you sharing that with us because I think it is so important for someone who’s listening to understand that you don’t have to wait till you get to that point, till that devastation. You have the choice to change your life now before something devastating happens to you like that or your turning point. And I appreciate you being vulnerable and sharing that on the podcast because that is something very, very hard and difficult to speak about and to share. So I really appreciate that and hopes that somebody listening and it could be any kind of event or something that could happen to them, but when you’re working so hard and you’re filled with all that stress and you’re taking care of everyone else besides yourself, if you’re that person right now listening, don’t get to that breaking point. Start today making those changes in your life to really be healthy, happy, and build the life that you actually want, not what you’re building for everyone else.

Tony:
I couldn’t agree more. And to Ashley’s point, Casey, thank you for being vulnerable about that moment in your life. My wife and I experienced a miscarriage before our first daughter was born, so we know how difficult of an experience that can be, but I think to use that moment as a wake up call for you to kind of reassess your life and point you in the direction and put you on the trajectory that allowed not only your financial goals to be fulfilled, but also the rest of your life, right? Finding that balance to be fulfilled is important. You talked about moving from California to Kentucky. How did that decision to kind of pack everything up, leave the Bay Area, how did that change, I guess really everything for you? Were you fearful leaving California? Why Kentucky of all the places to go? I guess so many questions.
Yeah. So I guess first, why Kentucky? Why did you decide to go there first?

Casey:
So my husband was from Kentucky. So he grew up in Kentucky, Central Kentucky, and he went to UK, University of Kentucky. And he told me a little bit about a city. So I never visit Lexington, Kentucky prior to moving here. So it’s like a total shock.

Speaker 4:
Oh, wow.

Casey:
Yeah. Yeah. So that’s to show you, when I said I’m going to do something, I’m going to do something. Does not matter. So a couple things about University of Kentucky, they have two sport teams. So they have a football and a basketball. So people would travel and they have students from all over the world. So people would travel here to see the team play. So I was thinking, oh, it’s going to be great for Airbnb. It comes as a surprise for me that they have so many hospitals here in downtown Lexington. So it’s really good for midterm rental as well. And then there’s an area about an hour from us called the Red River Gorge, and it’s where people go for a kayak, rock climbing. And we actually just bought our Airbnb there and setting it up.

Tony:
When I think about packing up my life and moving clear across the country, there’s probably a few things that are like running through my mind. Was there any moment of hesitation for you or was there anything that you were fearful of doing this? And the reason why I ask Casey is because, hey, we’ve interviewed quite a few folks who have done something similar where they said, “Hey, I’m going to move because I want a better quality of life. I’m going to move because I want to be able to save more money. I’m moving because of there’s this goal I want to achieve.” And each of them kind of had their own hesitations or fears around that. So I’m curious for you specifically, was there anything that you were afraid of taking this leap and packing up and moving across the country?

Casey:
Everything. We cry. I cry every single day prior to the move. I mean, prior to selling our home in California. After we sold it, we actually sold it for a really good price so I was pretty happy. But moving away from California, leaving my friends and the career that I have there, to me and to my husband, it’s like we’re failing. And to my husband especially, he moved away from Kentucky to go to California so that he can get this fancy job and now moving back, he feel like he was failing in California. So that was a mindset going into this whole process, but I know that the direction that we’re going, we’re going to burn all of our savings, we’re probably going to have to work. I probably going to have to work twenty four seven, never going to get to see my son, and that wasn’t the life that I want to live.

Ashley:
So at what point did you make the decision to downsize and actually sell your home? When did those steps kind of begin to take shape as to, did you list the house first? Did you find a house in Lexington?

Casey:
Yeah. So Jen, I would say around January of 2024, that’s when we decide, okay, we’re going to sell our home. As a real estate agent, I’m very aware of the market. And then when I pick our home, the area is an up and coming area. So the price have increased so much in two years. We were very lucky. We bought the home when the market was down and that is the beautiful thing about the Bay Area. The market just go up and down. If you time it right, you can cash out for a lot of money. So yeah.

Ashley:
We have to take a quick ad break, but when we come back, we’re going to talk about dog sitting to actually be in survival mode during that season in your life and how it actually ended up outperforming one of your rental properties. I want to dig into that next because that’s a hack most listeners have never even considered. We’ll be right back. Okay. So you mentioned this creative strategy that kept your family afloat when everything slowed down. So let’s talk about how you turned dog sitting, something most people overlook into a legitimate income stream. So walk us back to that first listing. What made you even decide to try dog sitting and how much did you actually make that first month?

Casey:
So we had a little dog. He’s 10 right now. So when he was little, we wanted him to have companion, but we didn’t want to have more dogs. So we thought, oh, we’re just going to do dog sitting so we have friends. So we enlisted our home or apartment at the time on an app called Rover and that’s how you get … It kind of like Airbnb for dog pretty much. You could do boarding or like daycare. And so we started about 10 years ago. In the beginning, we didn’t make a lot. In 2024, when my mom came to live with us and I thought, “We’re going to take more dogs.” And someday we have six to seven dogs, but all the tiny little dogs, we have a very big home, very big backyard, so everything was very easy. And the most that we make from dog sitting was $6,000 in one month.
And then that year, we actually make about $53,000. I’m laughing because I listen to you guys’ podcast every week when I go to the gym. And I remember in one of the episode, Tony was answering a question of this couple. They wanted to house hack, but they was worried about the roommate situation. They didn’t have a good experience. And I’m like, “Dog sitting. You should buy a house and dog sit.” And so I keep hearing the same question and I’m like, “I have to go on a podcast and tell people to dog

Ashley:
Sit.” What a way to generate income off of your property.

Tony:
Yeah. I don’t know if we’ve ever interviewed someone on the podcast who’s made that much money from dog sitting. I guess one clarifying question, Casey, was this at your home in Kentucky or was this still back in the Bay Area?

Casey:
So both. So in the Bay Area, we did that for all the homes that we were living in, all the apartments- But

Tony:
The 6K, that was in Kentucky?

Casey:
The 6,000 was in California because the race was higher there. In Kentucky, we just started, we moved here in November last year, and then I opened the calendar right away. And I think the most that we make is probably like $1,500 a month.

Tony:
So maybe a higher demand and a higher cost of living area to be able to hit those figures. But for all those folks who were living in a place like California, New York named the high cost of living place, sounds like dog sitting could potentially be a good way to generate some extra income. I guess, were you surprised? I mean, because 50 grand a year, that’s more than most rentals are going to make. Were you surprised by that amount at all, Casey, or was that …

Casey:
Yeah, it’s so funny because back in California, every month I would do our accounting and I text my husband, I was like, “Guess how much we make this month from dog sitting?” And he would be like, “$2,000.” And I’m like, “No, $5,500.”

Ashley:
Okay. So let’s just give the overall business picture of this. So the Rover website, do you need to … My mind always goes to insurance. Darryl will pitch me all these business ideas and I’ll be like, “Well, there’s a lot of liability. You’ll need to get insurance, which is going to be expenses because this could have, that could have. ” And so is that like Airbnb where you get insurance through the app or is that something you had to get on your own? Do you need to add coverage onto your homeowner’s policy? Are you providing the food, things like that, or people bring their own? What are your actual business expenses that are coming out of your pocket each month for this?

Casey:
So let’s say when you send your … It’s very similar to with daycare when you send your … Ashley, I know you have two sons.

Speaker 4:
I have a goat. Oh, my goal. I thought you were talking about daycare. I have a goat. When you send- My ghost doesn’t go to daycare. Grandma comes here to take care of the goats, right? When you send them

Casey:
To daycare, you pack their food, you pack their clothes or whatever. Same thing with the dogs. So Rover actually cover all the insurance, so you don’t have to get extra insurance. All you need to do, it’s very easy actually. And I am a little bit scared to bore my dog because I don’t know if they screen everybody. They said they do. So you have to send in your ID and they do do a background check on you. I never have any accident with any of my dog, knock on wood. The dog parents would bring all the supplies like beds, food, anything.

Ashley:
My son, he wants a puppy for Christmas and I’m thinking this is the perfect opportunity. Let’s sign up for this. We’re going to bring in the dogs. You take care of them. You show me responsibility and you can get a puppy.

Tony:
And then you can use that money to pay for the dog, Ash.

Ashley:
My God, I’ve been looking at prices as a dog. Oh my God. The last time I bought a dog when I was like 18, I brought it home to my parents’ house and my dad was ready to murder me, but it was like $200 maybe for my dog. And it’s like, I need $2,000 at least to buy a dog. Oh my God.

Tony:
Casey, what comes to mind for me, because we invest a lot in the short-term mental space. And I think about dealing with the guests and for you, I guess it would be like the- The

Casey:
Dogs.

Tony:
… the pet owners or yeah, the dogs too, right? I guess both of those, right? You’ve got both sides. Have you found it difficult to manage the actual owners? Because like you said, this is almost more like a daycare where they’re dropping off someone that they love. Have you found it difficult to interact and deal with the pet owners?

Casey:
For me, no. So with Rover, they have a process. Before you accept any dog, you can do a meet and greet. So the parents would bring the dog to my home to meet with me and I would see if that dog is nice, is it potty training, is it good with environment? And now I have a son. It has to be good with my babies too. And then it’s also an opportunity for me to kind of interact with that owner. If they seem just difficult, I wouldn’t accept a dog at all just because I know that a road is going to be more problem, but most of 90% of them, they’re really easygoing. They just want somebody love their dogs and I’m genuinely love dog. My dream is to have a facility where I can help homeless dogs, but yeah.

Tony:
Do you get a lot of repeat guests or repeat customers in this space?

Casey:
Yeah. My rebooking rates, I would say very high. So when a dog parents leave the dogs with me, they don’t go anywhere else.

Ashley:
How did this pivot actually change your mindset moving almost all the way across the country? How did this change your mindset about what financial creativity it looks like?

Casey:
So I think there’s a lot of ways to make money. And if you just want to make money … I’m an immigrant. I came from Vietnam and I think this country is pretty amazing. If you want to make money, there’s like 101 ways that you can do it, but if you want to make money, live a healthy lifestyle, be happy, and you can see your family every day, that’s very difficult. So moving to Kentucky, I know for sure my goal is my number one priority is to take care of my son. And the real estate portfolio that we have is really help paying for our mortgage, a little bit of our living expenses and selling our home in California really help us with that money to look for opportunities to invest in either Airbnb, midterm rental, or maybe like multiple units like duplex, fullplex, to get more income.

Ashley:
How much was the amount that you ended up profiting off of the sale of your house in California?

Casey:
Are you ready? Hold it onto my seat. So we bought it in September 2022 and we sold it in September 2024. And you have to stay in … Yeah, two years. You have to stay in the home for two years for your primary residence so that you don’t have to pay capital gain. We net $460,000 from the sale.

Ashley:
Two years and tax free.

Tony:
That is amazing.

Ashley:
Yeah. And so much on the podcast, we talk about not investing or moving. We just did a question on Rookie Reply about moving to a lower cost of living area and getting a house hacked there or whatever. But there’s also opportunity in the more expensive markets too, because you are oftentimes going to have a lot more equity buildup just because you’re buying at a larger amount.

Casey:
100%.

Ashley:
That’s awesome. Congratulations. Thank you.

Tony:
Casey, one follow-up question for me because you mentioned this as you were answering the last question, but you said you immigrated here from Vietnam. How old were you when you immigrated?

Casey:
17.

Tony:
17. Wow. So most of your young life, you spent living in Vietnam and came here right before you were a legal adult, and you were able to build yourself up to making over a million dollars in annual income. And I just think that it’s such an inspiring story. We interviewed Sebastian Rodriguez on episode 626, and I can’t remember what country he immigrated from, but when he came here, he literally knew no one. There was at one point he slept in his car and he was able to build up a really big amount of cash flow from his real estate business from just hustling. And the reason why I highlight that is because there are so many people who are listening right now who started off in such an easier position and still haven’t taken the action that there’s literally no excuse when there are folks like you, Casey, who have come over here, built a life, built that income and built the business, and it’s just about taking action.
So I just want to give you credit because it’s an amazing story and even more so given the fact you didn’t even come to America until you were almost 18 years old.

Ashley:
So I want to go over your portfolio that you’ve built. So what rentals, what properties do you have right now in your current portfolio?

Casey:
So we have two in Austin’s. One, it’s a long-term rental. The other one, we’re rented by the room. We have two in North Carolina, Raleigh area. We have a four unit in Palmer Heights, Ohio, and one unit in the building next door is a very interesting situation. We bought all five. And then we have our primary home and our Airbnb in the Red River Gorge.

Ashley:
And congratulations on building that impressive portfolio. And you had slightly mentioned that a lot of the income from these properties was like covering your current mortgage and other expenses for you. How has work shifted for you and your husband? Are you still selling real estate in Kentucky? Are you just managing your properties? What has both of your careers kind of shifted since you’ve made this move?

Casey:
Yeah. So my husband, we’re very lucky. My husband got to still work at the same company in the Bay Area. He has to go to California once a month. I’m still selling in California. I have a team there. I do have listing on the market, so it’s very easy. I just signed a listing, do the negotiation. My team will clean, stage, and do everything else.

Ashley:
Wow. So like all the showings and everything for you to not even have to be there?

Casey:
Yeah. All the showing I can pay agents per show to show, but usually I only work with listing because with buyers, you have to be there. You have to build a connection. It’s really hard to do that over the phone. I find that a little bit difficult when I moved to Lexington, Kentucky. And then I just got my license here in Lexington, Kentucky. I don’t know if I want to sell real estate again. I mean, it’s a really easy job to make good income, but I just don’t have the drive to do that anymore. I don’t know.

Ashley:
And you have the team already built too. If you wanted it to be the same model, you’d have to go and build a team from scratch here too.

Casey:
Right. Yeah. So I’m still thinking about it. I do have the license, but I really want to focus in real estate investing for now.

Ashley:
Well, that’s awesome. Congratulations on outsourcing what seems like 90% of your job to having other team members do it. That’s great.

Tony:
Okay. So we got to bring you back for two separate episodes. One, just to do a deep dive into dog sitting. And the second one is like, how do you automate your real estate agent business so you can do it from halfway across the country because both of those are incredible stories.

Ashley:
Okay. So you said earlier that all of this, the burnout, the reset, even the dog setting set you up for a much bigger move. Leaving California entirely. When we come back, I want to unpack what it took to sell the Bay Area home, pocket nearly half that million dollars tax free, and then start fresh in Kentucky. We’ll be right back. Before the break, you teased the big leap of moving to Kentucky, making that $460,000 gain off of your house in the Bay Area. But let’s go into that move into Kentucky and you actually saw an opportunity in one of these markets, the Red River Gorge to buy your investment property. So tell us about this market.

Casey:
So this market is pretty interesting. It’s an area where people go to do all the outdoorsy. And it’s funny because I’m not an outdoorsy. You can pay me money to sleep on the floor. I’ll pay you money so I can go inside. So we actually had a neighbor. So we move into our neighborhood and are across the street neighbor. My husband came home one day and he was like, “I met the neighbor. Guess what he does?” I said, “I don’t know. He does Airbnb.” And my mind just like …

Speaker 4:
Let’s go over

Ashley:
Right now and talk to him.

Casey:
Exactly. Everything happens for a reason. And so we chat with the guy and it’s really fun Tony, we did no research. And Tony, this is probably going to scare you. We did zero research before we buy this property in Red River Gorge, simply because we trusted the neighbor. He said it’s doing really good. The number is great. And we said, okay, we found our property, bought it. Now we’re getting it ready. So everything just happened.

Tony:
I’m glad it worked out for you guys. And I definitely want to get into a little bit about that property because I know it was a cool project for you guys. But yeah, I think it does make me a little bit nervous because I definitely don’t want people to follow in your footsteps because there maybe is a chance that the neighbor maybe gives some bad advice. But I guess what did he share with you that made you guys feel so confident? I think that’s really what I want to know.

Casey:
Just numbers, the potential of how much it going to make. And then I think two things about Lexington, the Red River Gorge and UK is like, it’s very popular here. Everybody that you talk to, they would talk about UK and they would talk about Red River Gorge. So it’s kind of like a destination where the local goes already. It’s really popular. The second thing is we actually visited. We went there for the weekend. It was pouring rain. So we didn’t do anything literally just stay in our Airbnb. But when I was there, I really do see a lot of potential. And I think for the next five to 10 years, it’s going to grow so big.

Tony:
Casey, the property that you actually end up purchasing, tell us a little bit about that. How big was it? What was your purchase price? Did you have a sense of what the revenue might be before you bought it? And if so, did those numbers match up? Just walk us through that deal a little bit.

Casey:
I am not a number person. You’re asking the wrong person. Did I look at the revenue? No, I didn’t do any numbers at all. The property is a two bedroom, two bath condo sitting on a one acreage lot and it’s surrounded by tree. It’s really, really beautiful. So somebody bought it, remodel it. And if you ever go to the Red River Gorge, you’ll see they remodel everything black. And they pick … I’m sorry, but the ugliest appliances, the ugliest color. I don’t know why. Everybody has the same thing. And so this property was newly renovated and it needs a lot of work. So I see the potential. We bought it. We kind of fixed it. This morning I listened to a podcast and Tony, you literally nailed it in the head. You said you have to account for the remodel and what is that? Furnishing cost, $30 per square foot.
And I did the calculation. I’m like, “Oh my God, he’s so right.” And we didn’t account any of that. So yeah, so we’re getting hot tub, cold plunge, sauna, and kind of make the property nicer for the audience.

Tony:
It is something that we see a lot where folks get maybe enamored with the property and like the amount of revenue that it can do, but then they only focus on the acquisition cost, which is your down payment closing costs. And they forget about like, “Hey, we’ve actually got to put stuff into it and we definitely don’t want to want to skip there.” You said that you think this area is going to grow a bit over the next five years. What are you specifically seeing, Casey, that leads you to believe that?

Casey:
So the property itself is 350,000 that we bought. We put down 20% and it’s going to bring in around 50 to $60,000 a year in revenue. So what I see is the area is still a little bit underdeveloped. A lot of people are buying and building these newer, more desirable Airbnbs, and then they’re putting a lot of shoppings in the area. So it’s had the potential to grow like Ganford.

Ashley:
Okay. Casey, before we started recording, one of the things you had said that has stuck with me, don’t be afraid to change. And you’ve really gone through an incredible amount of change yourself. So what does freedom mean to you now that you have completely shifted and pivoted your life and how do you define success today?

Casey:
So when I first started investing in real estate, my goal, to be honest with you, is to not work anymore, just move to, I don’t know, Southeast Asia, be on the beach and just hang out every day. That’s no longer the goal because I think if you live a life with no purpose, it’s just really boring. Having my son is really give me a new purpose as up to spending a lot of time with the family, take him, travel the world. So my ideal of success is to just get to spend time with my family, go on vacation, working in a really meaningful field that would give you a sense of purpose.

Ashley:
Well, Casey, thank you so much for sharing your story today with us and your lessons learned. And also congratulations on the portfolio and also being brave enough, having that courage to completely pivot in your life and what you’re working for. So where can people reach out to you and find out more information?

Casey:
You can follow me on Instagram. I don’t really go on there anymore, but it’s @KCZNwyn.

Ashley:
Thank you guys so much for listening today. I’m Ashley. He’s Tony and was you guys on the next episode of Real Estate, Ricky.

 

In This Article

America’s tipping point for small investors might come not from a sudden drop in interest rates or a deluge of new construction, but from something far simpler: For the first time in many years, more homeowners carry mortgage rates at or above 6% than enjoy 3% loans.

It marks a shift that will finally loosen the “rate-lock” grip on the housing market, which has kept potential sellers from listing their homes for fear of losing their low rate. The lack of inventory, fueled by too few listings, has been one of the biggest hurdles that investors and flippers have had to overcome since the Federal Reserve raised interest rates after the pandemic.

The all-important shift from lower to higher loan rates among mortgage holders happened at the tail end of 2025, according to MarketWatch, as an increasing number of buyers bit the bullet and purchased homes at 6%+ interest rates, leaving fewer homeowners with sub-3% interest rates originated during 2020-2021.

With homeowners forced to surrender or walk away from their sub-3% loans, the likelihood of an influx of properties onto the market and more opportunities for investors has become far greater than in recent years.

A Numbers Game

America is still chronically undersupplied with housing, according to Goldman Sachs research, which puts the shortfall at about 4 million homes beyond normal construction. While President Trump has recently made efforts to stimulate the real estate market through a ban on institutional investors buying single-family homes and by tasking Fannie Mae and Freddie Mac with buying $200 billion in mortgage-backed securities, neither initiative addressed the real issue in the housing market: supply. The end of the rate-lock effect could significantly change that dynamic.

Affordable Markets Plus Increased Supply Equal More Deals

The lapse in the rate lock stranglehold on inventory supply is likely to have its most profound effect on investors in generally lower-priced markets, where affordability and cash flow come into play.  

This shows in the data. States with modest home values, such as Mississippi, Oklahoma, and West Virginia, now have the greatest proportion of homeowners willing to take on 6%-plus mortgages, reflecting lower monthly payments and more flexibility for owners who wish to move or trade up. Mississippi’s average home value of $186,000, according to Zillow, lowered the state’s homeownership rate because homeowners took out mortgages at 6% or higher.

Robert Dietz, National Association of Home Builders chief economist, told NAR Realtor News:

“One of the trends we’re keeping a close eye on for 2026 is geography. We’ve seen new-home markets slow down in previously hot markets like Texas and Florida, in part because of some limited cyclical overbuilding and the fact that mortgage rates remained above 6% in 2025. But there are also pockets of strength emerging, particularly in the Midwest. Markets like Columbus, Ohio; Indianapolis; and Kansas City—areas that have long been more affordable and are close to major universities—are showing outsized growth.”

The End of the Rate-Lock Era Needs to Coincide With More Inventory

While ending the rate-lock era may bring more houses to market, it won’t increase overall inventory in the U.S. housing market, which needs to increase as rates come down and buyers feel more comfortable about the economy, to truly have a meaningful effect on affordability. That said, a loosening market is a prime opportunity for investors with cash to get involved on the first floor, anticipating an increased thaw.

Here are some steps that investors can take now.

1. Don’t wait for “cheap money.” It may never come. 

Underwrite today’s rates for 5.75% to 6.5% in long-term debt. Stress-test deals at Prime + 1% to ensure resilience. Let the past go and focus on cash flow or near-neutral assets rather than appreciation, so you can hold the asset long term, when appreciation will eventually kick in.

2. Target markets where people are moving

Being a landlord in a low-demand market is not a good move. By targeting affordable markets where people are also moving, such as secondary and tertiary markets in the Midwest and parts of the South, you can ensure both rental demand and either cash flow or, at worst, an investment that pays for itself, allowing you to benefit from tax benefits, appreciation, and tenant paydown. Targeting markets with rising inventory but flat pricing will give you room to negotiate.

3. Negotiate like it’s 2018

With more sellers than buyers in many markets, negotiating a good deal when you buy rather than when you sell is paramount to making cash flow work. This means:

• Ask for seller credits toward rate buydowns or repairs.
• Price reductions according to inspection findings.
• Request longer due diligence periods to conduct inspections and develop negotiation strategies.

4. Prioritize motivated sellers who own free and clear

Almost 40% of U.S. homeowners do not have a mortgage—i.e., they own their properties free and clear. This means they are not governed by Fed policy. Many of these owners may be looking to sell due to downsizing, aging out of homeownership responsibilities, burnout, or depreciation regulations. However, many may be interested in offsetting a big tax bill by holding the note and generating a monthly income without the hassle of managing a property.

Prepare an outreach strategy that includes:

• Offer simplicity and certainty, not top-dollar pricing.
• Offer clean closings and flexible move-out terms.
• Be a solution provider, not a bidder.

5. A turnaround in the housing market will be gradual, so get your financing in place now

• Get your credit in the best shape possible.
• Firm up relationships with credit unions and community banks.
• Keep liquidity for repairs and concessions.

6. Remember that the market will reward incremental accumulation, not trophy buys

• Look for small multifamily buys that maximize cash flow, mitigate risk, and provide financing flexibility.
• Seek out value-add deals that favor light cosmetic upgrades rather than major rehabs.

Final Thoughts

The end of the rate-lock era signals a return to a functioning real estate market—not a sub-3% bonanza. Thus, careful moves that leverage the fine margins of a gradually shifting market are the way to proceed, gradually accruing assets while always protecting the potential downside. 

Don’t be sold on the hype that tends to accompany any real estate momentum. We are way off bidding war terrain, so negotiate carefully with a long-term 6%+ interest rate in mind and be prepared to walk away if the numbers don’t work.

Ashley:
If you ever wondered if you really need a realtor to buy an investment property, or have you ever thought about putting 40% down and self-managing making it a smarter move? Well, today we’re going to break that down along with what do you do when a borrower ghosts you? This episode will help you avoid costly missteps and move forward with confidence. This is The Real Estate Rookie Podcast. I’m Ashley Kehr.

Toni:
And I’m Tony J. Robinson. And before we jump into the first question, let’s just give Ashley a big shout out from being so hip that she knows what six seven is. And if you don’t have a kid between the ages of probably, I don’t know, eight and 18, you might not know what that is, but look it up, give yourself a good laugh of going down the wormhole, trying to figure out what it means because we don’t even know what it means. We just know that we should be saying

Ashley:
It. We don’t. But also, Tony brought up too, because before I said I want to say the episode number for this, he said, you do realize this release is in January and it’s probably an old trend by now. So everybody is probably rolling their eyes and every kid that’s sitting in the back of your car right now listening to this is probably like, “That’s so yesterday, that’s old.”

Toni:
That is so yesterday. We’re such millennials.
So my son’s almost 18 and he called me Unc the other day. So I’m like officially my Unc phase. Well, let’s get into the first question for today. Today’s first question comes from McCauley in the BiggerPockets forms. And McCauley says, “I’m looking for guidance on whether or not I am required to use a realtor to buy my second property or not. I hear all of these success stories from so many people about buying rental properties, but no one has ever mentioned if they use a realtor or not. I assume some state laws require you to have a real estate agent in order to close on a house/investment property. My question is, do I need a realtor to buy on/off market deals? And if so, what are some good questions to ask to make sure their expertise aligns with my investment strategy?” It’s a great question.
And it’s the perfect kind of beginner question that I think can maybe put to rest some of the misconceptions that exist out there. As far as I’m aware, and obviously I haven’t purchased in all 50 states, I don’t know of any states that require you to use an agent to transact on real estate. Now, I know there are some states asked like where you’re at in New York where you have to use an attorney for a closing, but attorneys are not agents. So I’m not personally aware of any states that require you to use an agent to transact on real estate. Do you know of any, Ash?

Ashley:
No. The only thing I would think is kind of an iffy area is if the seller has an agent and then you go to buy the property. How would that work? Because anytime I’ve done that, it’s been like a dual agent and they get the 6% commission or whatever, but you sign a form saying they’re representing both of you. So I’ve never experienced or heard of anyone that has went and bought a deal off the MLS and not used an agent, whether it’s the seller’s agent and you’re using that person to represent both of you, or if you’ve gone and gotten your own agent to represent you. So that’s actually a piece I don’t know the answer to.

Toni:
I don’t know either. I’ve purchased quite a few where I’ve gone directly to the listing agent, but I just always offer it to them like, “Hey, I don’t have an agent. You can double in the deal if you want to. ” I don’t need you to, but you can if you want to. So yeah, I don’t know if maybe there is a law or a rule around that. So if you’re watching on YouTube and you have the answers to that question, drop it in the comments and cite your source so we can all go back and double check that.

Ashley:
And don’t cite ChatGPT.

Toni:
Yeah. My good friend Chat said. Even

Ashley:
Though it probably does have the answer.

Toni:
Yeah, it probably does. But I think maybe the main point of this question is just like, is there value? So I think the first part, no. Generally speaking, it is not required to work with an agent. Now, I do think for a lot of new investors, honestly, that there’s value in working with an agent. I think about the first deal that I bought and my agent was an amazing resource, both in terms of getting a better understanding of that area because I was investing long distance, having a connection to other vendors in that market that I was going to need, namely my general contractor that I ended up hiring. So my agent as a first time investor was incredibly valuable, not so much for, I don’t know, like the transactional side, but just their overall knowledge of the market and their connections to other people.
So yeah, I would maybe even just encourage you, McCall, if you’re investing in a market where you’re not super familiar, there is value maybe in having an agent working with you.

Ashley:
And I think too, really sit down and understand what you’re not confident in so you can look for an agent who knows that well. So when I go to a new neighborhood or a new area, I rely on my agent a lot to tell me about the comms, to tell me about the area, what’s up and coming, what’s the bad parts of here, what streets should I stick to, things like that. And I think that has tremendous value. If you need help actually analyzing the deal, make sure you’re working with an investor friendly agent because I work with an agent that does a lot of selling primary homes and not a ton of investment property. And I think I don’t really rely on her at all to actually analyze the deal. I go and do that myself and I feel very confident in that, but I do rely on her.
I rely on her for showings and for a lot of the market analysis. If it’s like a different area of town that I don’t have rentals in, I really, really appreciate the information that she has and she provides for me. And I also rely on her for negotiation as in what are people negotiating in the current market? If I add in a contingency that they need to have the whole house cleaned out, broom swept and leave the appliances, is that going to cut me out as a contender because everybody else is saying, “Leave all your junk. We’ll take care of it. ” So I also rely on her for a lot of the negotiation piece. And as issues come up, even the inspection, I will rely on her as a part of what’s going on in the current market. Are buyers going to take care of this or the sellers take care of this?
So I think there is a lot of value in using an agent, but you have to know going into it, what do you need help on? Because you could get an agent that has no idea what the rental comps are and you needed help on that. And then it’s not going to be as valuable to you as you thought using an agent was.

Toni:
Yeah. Great point, Ash. That nuanced information they have about the market is really important. I met an agent once who sold property in Florida and she told me to not buy homes in her city that were built in the ’90s. And she’s like, “Any other decade, you’re fine. But the ones in the ’90s, she’s like, I bought and sold a lot of houses in this market. Those ones always suck when it comes to getting flood insurance.” She’s like, “I don’t know why, but insurance companies hate the homes from the ’90s.” You only get that kind of knowledge if you’ve done a lot of deals in a market and agents sometimes have that expertise. And then on the other side that I mentioned of just their network and their contract or their contacts, I went out to Oklahoma City. I’ve talked about it a few times in the podcast over the summer and I met with an agent who I found through the BiggerPockets Agent Finder and she gave me the lay of the land, but then she introduced me to, “Hey, here’s an insurance agent for this market.
Here’s a contractor, here’s a handyman, here’s some property management companies.” Literally gave me an entire Rolodex of people that I could then go out and network with to build my team of people to be able to do this remotely. So the right agent I think can make your first deal exponentially easier because of their knowledge and their Relodex of folks they can introduce you to. And then the last part of that question was what questions as a rookie investor should I ask an agent? First, find your agent from the BiggerPockets agent finder because those are typically folks who know and understand what it means to work with an investor and not general retail buyers who are looking to buy their dream home or their starter home. So first just make sure you’re going to the right place. But second, ask them, “Hey, how many transactions did you do last year?
Did you do five or did you do five a month?” And of those 60 that you did last year, what percentage of those were sold to real estate investors or were you working with a real estate investor? And if it was one out of those 60, okay, that’s kind of telling. If it was 49 out of those 60, then maybe that’s a different story. So I think just getting a sense of what percentage of their current client base is an actual investor will give you a better sense of if they’re the right person for you to work with as well.

Ashley:
Okay. We have to take a short break, but when we come back, we’re going to go over running the numbers and deciding how much to put down on a property. We’ll be right back. Okay. Welcome back. This question is from Abdul and the BP forums. I’ve been running numbers for a while now and came to a conclusion that in today’s market and going through conventional investment loan, which is a half or a percent higher depending on your LTV and DTI, it is better to put 40% down and self-manage to generate cash flow. Does anyone else run into this situation? I think this is a great example of not comparing apples to oranges. So when we talk about down payments and we talk about generating cash flow, Tony can say, “I have this property and I generate $1,000 in cashflow and I can say I have the exact same property, but I generate $500 in cashflow.” And then I think, “Ugh, Tony’s doing better than me.
Tony’s got a better deal, blah, blah, blah.” But you have to know the insides of the deal as to, well, Tony paid cash. He doesn’t have a mortgage payment. That’s why he is cash flowing $1,000. I have a mortgage payment, so I’m paying the mortgage. That’s why my cashflow is less. So you have to look at other factors to actually determine how these deals are comparable. And one of those things to look at when you’re deciding on putting a larger down payment is your cash on cash return or any down payment in general as to will the deal still make sense not only to generate more cash flow because Tony could be generating more cash flow, but he could have way less return on his money and could have done better investing that money somewhere else instead of dumping it into this property. If he bought a $500,000 property in cash and he’s only generating $1,000 per month, that’s actually not that great of a deal, in my opinion.
So I would say look at the cash on cash return and not just look at the cash flow that the property is generating. And if you are going to self-manage, I would still look at the numbers if you outsource it. If there is some kind of change in your life that requires you to outsource it or you get burnt out or you just don’t like it, bake it into your numbers so you know going into it, you can still generate some cash flow and keep the property afloat if you were going to hire out the management piece.

Toni:
Ash, let me ask you, because I think that there’s always nuance to this, but I mean, for Abdul to say very matter of factly that it’s better to put down 40% and self-manage, that’s a very case by case basis on how we can actually respond and answer to that question. A lot of it comes down to the market that you’re buying in. A lot of it comes down to the buy box that you’re going after, the strategy that you’re going to employ with that property. But I think to say that as a rule, 40% in self-managing is always the best option is a hard thing to state. If in your market updal and for the specific type of property, buy box strategy that you’re going after you find that to be true, then maybe this solution is not necessarily putting down 40%, maybe it’s putting down 20%, but going to a different market.
If you’re in an area where only 40% down works, well then go find one of the other 20,000 cities that do allow you to put down 20% and still get meaningful cash flow with having a property manager. Maybe try a slightly different strategy where instead of buying a single family home, maybe you’re buying a small multifamily and maybe instead of doing a traditional long-term rental, maybe you’re doing rent by the room or midterm rental to short-term rental. So I think if what you want is a less down payment and to have a property manager, don’t box yourself into looking at the same places you’ve been looking at because it’s not working there. It doesn’t necessarily mean that it won’t work in a different market somewhere else.

Ashley:
I think the last thing too is the emotional piece to it. If you’re going to put 40% down as us wiping out every dollar you have in your life savings and all your money is going to be tied up into this property. Are there other opportunities that you can use some of this money that may be a better opportunity? Also, would you actually sleep better at night if you had more equity in the property and did put that 40% down? Would you feel better not having so much debt and so much a leverage on the property? So I think there’s definitely an emotional piece. And also, would you actually want to self-manage the properties and do you have the time to do it? Do you have the skillset? Do you have the tools and resources to actually self-manage? It is 100% doable, whether you are a stay-at-home mom or you have a demanding W-2 job if you put the right systems and processes in place.
We actually have a really great book on BiggerPockets. It’s called the Self-Managing Landlord, and you can find that in the BiggerPockets Bookstore by going to biggerpockets.com/abookstore. Okay, we’re going to take our last break and we’ll be right back. Okay, let’s jump back in to our last question here. This question comes from Craig and the BP forums. So I sold a property to someone and I carried the loan as in they did seller financing. This person stopped making payments and I foreclosed on him. The property is now in my name, but he walked away and left everything from furniture to clothing and everything else. It’s like he never left, though according to neighbors, he hasn’t been seen on the property for a good six months about the time I started the foreclosure proceedings. This is all new stuff too, not junk. I’m in Northern California and we’ll be getting legal advice, just getting educated before I dig deeper into this.
The man I’m dealing with has a history of frivolous litigation and dishonesty, which is why I haven’t contacted him yet. What could he be up to and what are my responsibilities? Tony, once again, your backyard causing problems for landlords because they’re so worried about- What’s going to happen? … what you could legally do.

Toni:
Yeah. It’s funny, we had a somewhat similar issue with our hotel in Utah where in addition to the hotel, it actually also came with 13 storage units and we’ve had such a hard time tracking down who owned the things that were in these units because we weren’t getting paid for about half of them. And the previous owners didn’t know. They just didn’t even worry about it. They’re like, “Hey, it’s been there for years. We’ll just leave it there.” But obviously we want to be able to maximize that revenue. So we actually reached out to an attorney in Utah and explained the situation and got guidance from them on what steps do we need to take to do this. Now, obviously this is a self-storage unit, which is different from a single family home where you had a lease and they didn’t pay, but basically we had to go through this process where we put a public notice in a newspaper.
We had to get them a certain amount of time to reach out to us and contact us. And if they didn’t, we had a date that we’d be auctioning off their things or selling their things or disposing of their things, but there was a very clear legal set of steps we had to take to dispose of their items without breaking the law. So Craig, I don’t know what that process is in California, but I would assume there’s probably some sort of path you can take given that you’ve already foreclosed and this property now belongs to you of what you can do with those items. It could be as simple as like, “Hey, you own the property, you own everything that’s inside of it as well.” That could be the simple answer or it could be, “Hey, maybe the previous person still has some claim to it.
” But I would probably just reach out to a good attorney, explain the situation and let them give you their best advice.

Ashley:
My guess is that you’re going to have to do an eviction proceeding because in New York, I know if you bought a property that was foreclosed on from the bank, you buy it from the bank. If there are people occupying that property, you have to actually evict them. Even whether they own the property or they had a lease or not, you have to do an eviction on the property. You can’t just kick them out and throw their stuff out. And with this person being completely dishonest, and this is one thing we always make sure to do is even if another tenant tells us like, “Oh, that person moved out, they’ve been gone, blah, blah, blah, they left.” If they have stuff in there and it’s not super evident that they have left or they haven’t given us communication that they left the property, we go through the foreclosure process of having them served.
And obviously if they’re not there, we have it slapped to their door. We always use a third party to serve the affidavit, and then they sign an affidavit saying that they tried three times, a person didn’t answer, so they put it onto their door. And then when it’s still no communication, nothing, whatever, then we go through and start the eviction proceedings. So I’m assuming California probably has a long eviction period just like New York does, but that is probably, I would guess, what the recommendation is going to be is to start that eviction proceeding that you want them out of there. And obviously it wouldn’t be for nonpayment, it would just be like you’re giving them notice that you’re no longer renting to them. And I know some parts, I don’t know if it’s all California or some parts, but there’s something about if you can’t not renew their lease, so there has to be something where this person doesn’t even have a lease that you can go ahead and evict them from the property, but I’m going to guess that’s what your first step is going to be is actually going through the eviction process.
But I would say it wouldn’t hurt to reach out to the person and to ask, “Did you vacate the property? Did you move out? ” And if you can get them, I would put this into an email and have them respond in an email. I wouldn’t do this over the phone, but if you could get something in writing or better yet, send them something to e-sign or have them sign something that’s notarized saying they have vacated the property. So you say, “Okay, they vacated the property. Next step, you’re getting dumpsters, you’re throwing out all their stuff. They left it behind. They have moved out. ” And then you have something that’s notarized that’s stating that they moved out of the property, they’re gone, whatever, if they do try and come back after you for throwing in all their stuff, you have some kind of notice.
But again, talk to your attorney, but I would guess that’s kind of where you’re going to be at is starting the eviction process.

Toni:
So Ashley, let me ask, because obviously you know landlord tenant laws far better than I do. In this case, he sold the property to that person. So it doesn’t seem like there was a lease in place. So you’re saying even though there wasn’t a lease, the simple fact that they had tenancy there would still force you to evict them even if the foreclosure had already closed? That’s interesting. I wouldn’t have thought that.

Ashley:
Yeah. Think about squatters. You could have not owned the property, you could have not had a lease and you could literally go into the property and just say, “Hey, I live here now.” And still the person, the owner would have to go and evict you. So yeah, especially in California, I would say that that’s probably even more lenient of being able to, that person have a claim to the property still.

Toni:
Yeah. Some things just seem backwards, right? It doesn’t seem right that someone could not pay me money, completely not fulfill their obligations, and then I’ve got to rent the cost of getting them out of my property that they already weren’t paying for. So I don’t know. We’ve got to find a better solution for that.

Ashley:
Well, thank you guys so much for joining us today on Ricky Reply. I’m Ashley. He’s Tony. And we see you guys next time.

 

Dave:
These are the best markets to buy rental properties right now in early 2026. If your local market is too expensive or you’re hunting for a new city with serious profit potential, deciding where to invest is arguably the single biggest choice to make as an investor. So today we’re breaking down exactly where smart real estate investors should be looking for new properties right now. We’ve crunched the numbers and in this episode, we’re going to unveil nine prime spots across the country where you should consider buying property today. What’s going on everyone? I’m Dave Meyer, head of real estate investing at BiggerPockets. On today’s episode, we’re giving you our list of best investing markets right now, and this is always one of our most popular episodes of the year. So we’re back in January of 2026 with an updated edition. The timing right now really couldn’t be better for refreshing our market recommendations because the real estate landscape shifting pretty fast right now and investing conditions are really diverging.
They’re wildly different in different regions of the country. So figuring out the right place to invest is more important than ever. So in today’s show, I’m going to highlight several markets that have caught my attention personally, but on the show we also have host of the Real Estate Rookie Show, Ashley Kare joining us. And of course, we also have Henry here as well to share his picks. Ashley, Henry, good to see you both.

Ashley:
Thank you so much for having me.

Henry:
Hey, glad to be here. Thank you.

Dave:
All right. Well, let’s just get straight into it. We’re each going to cover three different markets. I don’t know why this is just the format that we made up last year and it’s been very successful. So three is the magic number. And Henry, I’m going to pick on you. You got to go first. So name your first market. Which one caught your eye?

Henry:
I choose my markets based on that they have cashflow potential where you could potentially get a deal on the market. So I’m looking for a solid rent to price ratio and I’m looking for the median housing price to be in an air quotes affordable range. If I can get a solid rental price ratio and an affordable home price, that tells me there’s probably deal availability on the market should you choose to because I want most people to be able to have access to buy deals here. I don’t want to just pick markets where you got to go off market.

Dave:
Awesome. All right. So tell us what you found.

Henry:
First market I picked is Hattiesburg, Mississippi.

Dave:
I couldn’t tell you a single thing about it.

Henry:
That’s the response I

Dave:
Was

Henry:
Expecting.

Dave:
That’s what you want. Yeah.

Henry:
That’s what you want. But I choose this market. A, it’s a college town. B, it’s got a high rent to price ratio. It’s got relatively low vacancy for a smallish metropolitan area, and it’s a landlord-friendly state. So the median home price, who wants to take a guess at the median home price in Hattiesburg, Mississippi?

Ashley:
175.

Dave:
Yeah. All right. Ashley probably got it. 175.

Henry:
192,000 median price, but the median rent is guess what?

Ashley:
2,200.

Henry:
Whoa. 1,456.

Dave:
Okay. Yeah, there we go. Ashley’s just envisioning paradise. It’s like a rental paradise.

Henry:
But I mean, with those numbers, with the median home price at 192, that tells you on the market you can find homes listed for less than 192, but the median rent’s about 1,500. That’s cashflow on the market. You can probably find a deal listed that will make you some money as it sits. So that’s a rent to price ratio of about 0.76 with a vacancy rate at 6%. That’s really, really solid. So I like the fundamentals here. Yes, you can buy a deal on the market that probably makes sense, but if you’re going to look off market, you can probably find some really great deals and get great year one cashflow, which is hard to do in a lot of markets. You’ve got great jobs because the university and healthcare systems are the major employers in the area. Those are solid job options, as well as if you look at what’s coming to the area, there’s a company called Rouses Markets, which is expanding and entering the city through acquisitions.
So we’ve got more jobs coming in the food space. FedEx is opening a logistics facility in the area. I

Ashley:
Like that.

Henry:
And you’ve got ongoing reinvestment projects and logistics tied to those healthcare companies. So the city’s investing in the downtown. Companies are investing in the market to make sure that they’ve got amenities for their employees, and you’ve got new employers like FedEx and food companies like Rousers coming into the city. So you’ve got growth. And another reason I chose this is they don’t have a ton of new development going on. In other words, they’ve got about a 50% ratio in terms of new permits coming into the area. So it’s not going to be an area that is overbuilt going into the future. So it’s just a solid market. It’s what you’d call a baseit or a double market. You’ve got great jobs, you’ve got growth in the economy, you’ve got low vacancy, and you can buy properties at cashflow.

Dave:
I mean,

Henry:
It’s just solid numbers. They’re not the most amazing numbers for our market, but it’s affordable and it has good numbers.

Dave:
All right. I like this one, Henry. Very good. Ashley, what’s your first one? Is this the one we’re going to hate?

Ashley:
It is because I think it was the last episode we recorded where we all screamed out the state we would never invest in and you guys both said Florida.

Dave:
Okay. All right. I already hate it.

Ashley:
So this one is Ocala, Florida. It is located in between Tampa and Orlando, and it is home of the World Equestrian Center.

Dave:
Ooh, okay. All

Ashley:
Right. One reason I chose it is because it’s dead center and hopefully we can get better insurance because it’s not on the coast of better weather. But the big part of picking this one was because of the affordability, the rent prices you can get, but also that there’s so much new development going on there. 263 acres of sport complex is being put up. Since 2020, the city population has grew about 10%. It’s considered one of the fastest growing metros in the US right now for Marion County, which it’s located in. The average home value is about 267,000.

Dave:
Okay, that’s pretty good for Florida.

Ashley:
Yeah. And then rent varies. I found two different sources. One said the average rent is around 1,300 per month. Another source on Zillow said 1,700 per month.

Dave:
Oh, wow. Okay. That’s pretty good. I actually think there are great markets in Florida, and this happens to be one of them. Ashley, can you say a little bit more about it being in the center of the state? Because I’ve been reading a lot about that and why that’s so valuable.

Ashley:
Well, first of all, you’re more protected from hurricanes coming through being in the center than you are on the coast. Insurance, you’re going to get better insurance because you’re not in a flood zone. And then also you’re located in between two major airports of Florida for easy access. And I did read something too where they’re trying to get approval to actually build their own airport in there because of just the equestrian world deal that’s going on there.

Dave:
All right. I like that. Actually, I was reading some article, I think it was at Redfin, and they were talking about how there’s been all these predictions about how there’s going to be climate migration because of hurricanes or whatever. And what they actually found is that most of the migration due to extreme weather is within the same state, that people aren’t saying like, “Oh, I’m going to leave Florida. I’m going to move to Minnesota.” What they’re doing is moving from Cape Coral or Tampa to Ocala? How do you say it? I think Ocala. We’ll find out in the comment. Orlando. Yeah. Yeah. Everyone in the comments will tell me Orlando. So I do think that is a really interesting trend to be able to capitalize. And obviously, even though Florida’s a little bit volatile for my liking, obviously there’s a lot of good economic population demographic things going on in Florida.
They’ve been talking about getting rid of property tax. I’m skeptical that that’s actually going to happen, but if that actually does happen, that would be pretty crazy. It would probably help the housing market recover there. So I don’t truly hate this. I just pretend hate it for the show.

Ashley:
They do have a good … It’s a 3.3 ratio for every one person that leaves Ocala, 3.3 people come into it.

Henry:
Wow. That’s pretty crazy. So growth is nuts.

Ashley:
And then also 50% of the people rent there too. All

Dave:
Right. You might be winning so far, Ashley. That’s a lot of good stuff right there. I mean,

Henry:
In between two major metros is awesome.

Dave:
Speaking of two major metros, my first one is also between two major metros and it’s a pretty solid market in itself. I set out today to try and find some contrarian ones. I wanted to find some in the Northeast because people say you can’t find cashflow there. I’ve tried to find some in the West and just completely failed. I couldn’t find anything good, but I did find one in the Northeast. It is Hartford, Connecticut. And as Henry said, being between two major metros is great. Hartford, Connecticut is kind of sandwiched right between New York City and Boston, two of the biggest economic engines in the entire country. And it is way, way, way more affordable. So New York and Boston price is easily a million dollars to buy something in one of those cities. But if you look at Hartford, Connecticut, the median sale price, 320,000.
So for the Northeast, that is pretty good. And you’re still, you’re getting rents at about 2,000. So you might be able to get some right off the back cash flow. I’m guessing you’re probably going to have to do some value add, which is totally fine. I mean, for me, at that price point, you hopefully have a little bit of money to be able to invest in that. And it has a really good solid economy. It’s one of the insurance capitals of the entire country. A lot of businesses that have satellite offices from New York or Boston do it there. A lot of people who potentially have hybrid work situations and only have to go once or two days a week into Boston, New York can live in Connecticut. That’s what Connecticut is booming right now. And so it’s great. It’s a pretty recession proof economy.
The Northeast typically is a pretty stable economy because there’s so many big companies there and it’s affordable. So I really like it. It has some of the highest appreciation rates in the country right now. And it’s just totally underbuilt like a lot of the Northeast. There’s just not a lot of development going on. And so you probably have some legs behind you on that. So I really like everything that I’m seeing in Hartford, Connecticut right now.

Henry:
I mean, I’m going to use my official/unofficial powers in this episode to go ahead and deem you the round one winner because Connecticut is such a sleeper market. Right? So many New Yorkers live in Connecticut and commute. What I like about Connecticut is the density of small multifamily. I just love small multifamily in general. And those 20 units and under, there’s a ton of them, tons of them. And you can get great deals on them. Rents are amazing. It’s just a sleeper market in turn. If you like small multifamily, man, you can do great out there. And I just really like it.

Ashley:
How are the tenant landlord laws in Connecticut?

Henry:
It is not as landlord friendly as the South, but is not as tenant friendly as New York by any stretch. So I’d say it’s somewhere in the middle in terms of that. Which I’m okay with. I’m okay with

Ashley:
Middle. If I can make it work in New York, Connecticut. Right.

Dave:
For sure. Right. Yeah. Yeah. You’re only going up, Ashley, from where you are. All right. Well, let’s take a quick break, but when we come back, we’ll do round two with our best markets to invest in 2026. Running your real estate business doesn’t have to feel like juggling five different tools. With ReSimply, you can pull motivated seller lists, skip trace them instantly for free, and reach out with calls or texts all from one streamlined platform. And the real magic, AI agents that answer inbound calls, follow up with prospects, and even grade your conversations so you know where you stand. That means less time on busy work and more time closing deals. Start your free trial and lock in 50% off your first month at resimply.com/biggerpockets. That’s R-A-S-I-M-P-L-I.com/biggerpockets. Welcome back to the BiggerPockets Podcast. We’re going through our favorite markets to invest in 2026. Henry, you went first last time, so I’m going to go back to picking on Ashley.
Ashley, what’s your round two pick?

Ashley:
So this one, I went for a short-term rental market, and I ended up picking Fredericksburg, Texas. So the reason I chose this one is because it’s close to Austin in San Antonio, and it just has a lot going on. A lot of festivals, wineries, culinary tourism. Oh,

Dave:
It’s got a cool downtown. I’m looking at it right now.

Ashley:
It is a little bit more expensive than the usual markets I pick. So the median home value is 514,000.

Dave:
Ooh, okay.

Ashley:
The long-term rent isn’t that great, but for short-term rent, the average nightly rate was $254 per night, 48% occupancy, and the annual revenue per listing averaged around 45 to 50,000 a year.

Dave:
Wow.

Ashley:
So a big part of this one was really just the draw to it. As an investor, I don’t want to invest in a short-term rental in a big city where there’s a lot of major hotels, things like this. In Fredericksburg, there’s just starting to be development of bigger hotels. The Waldorf Astoria is starting to develop a hotel there. So kind of like doing the Starbucks model of following where they’re going.

Dave:
Nice. I mean, that makes a lot of sense. Yeah, that’s a really good idea. It looks very cool. I’m just looking at some pictures right now. It just looks like a fun place to go. So is this the kind of town though where you could rent this out and make money long-term if you needed to, or are you sort of going all in on short-term rentals here?

Ashley:
Yeah. Long-term rentals, you’re only seeing like $1,200 a month. Oh, wow. Yeah. So very well.

Henry:
Wow. So you got to be an experienced operator in this because this sounds risky to me. I mean, I’m not going

Ashley:
To lie. This would be for a short-term rental, this would work. Long-term rental, no.

Dave:
So this is a play where you’re really going to make a high quality short-term rental experience. You’re kind of like making a destination property.

Ashley:
Yes. Yes.

Dave:
All right. Well, I don’t know. Ashley, this one’s a little risky for me to be honest, but I’m not a short-term rental expert, so I might not know. But I would go visit Fredericksburg. It looks pretty fun.

Ashley:
We’ll have to ask Garrett on bigger stays for his opinion.

Dave:
Yeah, we’ll have to ask Gary about this one.

Ashley:
Because he’s from Texas too.

Dave:
Oh, he is. Yeah. We’ll have to ask them about it. All right. I’ll go second on this one. And mine, now I’m going down to the southeast with both of you as well. I’m going to Knoxville, Tennessee. I really do. I like this market a lot. Great market. So we’re seeing prices about 300 grand, which is pretty good, pretty affordable compared to everywhere else. Rent’s pretty solid at about 1,800 bucks. So I mean, you’re not getting amazing cash flow right away, but you probably still can. But there’s just so much to like about the economy. And I actually did a little bit of extra research here because I just wanted to give people an example. When you just look up the rent to price ratio of an average city, this one comes in at 0.6. Not terrible. There’s like value add, you can make that work, probably not going to work for everything.
But I specifically started digging into it because I was curious per Henry’s comment about like, are there small multis? That’s what I like to buy in Knoxville because I don’t even know what kind of housing stock there is. And there are. And when you actually look at the rent to price ratio for small multifamilies, it goes up to 0.75, which doesn’t sound like a huge difference, but that’s a big difference. That’s the difference between probably getting year one cashflow and not getting year one cash flow. So I really like to see that. It has really strong population growth at 1.1%. You have the University of Tennessee as their largest employer. Other largest employer, top five, Dollywood, which I’ve never been to, but I want to go to. So that was exciting. Unemployment rate at 3.1%. Rent is still good. And fun fact, it’s the birthplace of Mountain Dew, which I also enjoy.

Henry:
So there you go. What I like about this market is you can do a little bit of everything. I think you can find deals that work if you’re willing to put in the work in a market like this. It’s a college town, which means there’s going to be growth and jobs. It is not far from Asheville, North Carolina, which is a good real estate market in itself. It’s not far from Pigeon Forge, which is a great short-term rental market if you wanted to get into short-term rentals. I just think it’s got variety of entry points, which is solid.

Dave:
It’s just a great solid market. I think it has a lot of upside too. It’s solid today and might become a growth market in the future. And so to me, that’s kind of the perfect experience. Very low risk, high upside, affordable entry point. I’m like in Knoxville. Henry, you got to go. What’s your second round pick?

Henry:
Look, man, I’m telling you, I like old boring real estate, so I didn’t pick exciting markets. I just picked markets with solid numbers. Second pick, Morgantown, West Virginia.

Ashley:
I just saw West Virginia on a list of top 10 states of where people are leaving.

Dave:
Yeah, it’s a sad situation there. Their economy is really rough.

Henry:
Here’s why I picked it. Median home price, 237,000, median rent, about 1552. So that’s a 0.65% rent to price ratio. It’s got 6% vacancy. Unemployment’s at 4.4%, but one year job growth, around 2%, five-year job growth around 2%. Okay.

Dave:
Oh,

Henry:
That’s

Dave:
Good. So

Henry:
Growth in jobs, small growth, and I know you said people are leaving, but I believe there’s a one or 2% growth in population. But I think this is because it is a college town. It’s the University of West Virginia, which is a Big 12 school. This is a big school, big basketball school. So lots of people end up coming to this metropolitan era. Now, do they stay here after they leave college? That’s a different thing.

Dave:
I want to just say, I think people look at state level population a little too much. I invest in Michigan. It’s a state that has very bad population numbers, but there are very good population numbers in certain cities and I don’t really care what’s going on in the state as a whole because a lot of people might be just moving from within the state to the one or two cities that have good job growth and good economic prospects. And so I just think population is really much more important on a local level.

Ashley:
A lot of the numbers are.

Dave:
Yeah. I mean, yeah, that’s true. Pretty much everyone.

Henry:
But look at the employers. That’s why I like it. So the University of West Virginia, about 7,000, 6,500 employees, that’s big. West Virginia Medical, about 7,000 people employed there. And then Monday Health, which is about 3,000 people. So heavily invested in healthcare, but typically a lot of college towns who have medical schools, that’s what they have in that area. And then Kroger is another big employer in the food space there. So solid jobs, solid schools, solid healthcare, downtown revitalization projects going on. I always like to look at, is the city itself spending money making the place better? Because if the city’s not doing that, then it’s probably not a place where people want to live. But the city itself is spending money there developing a rail transit system to connect people outside of downtown to the downtown area. And then the University of West Virginia is putting a lot of money into expanding its facilities in that area.
So the businesses that are there are spending money and staying there and the city is spending money trying to make the area better. It’s a big school, big 12 school, and you’ve got solid numbers at 237,000 with $1,500 of rent. So you can find deals maybe on the market that makes sense, but if you’re willing to put in a little work, you can probably find really great deals. So just a boring fundamental market. Is West Virginia the sexiest state in the world? No, but we’re not looking to invest in sexy places. We’re looking to invest in places and make money.

Dave:
I don’t know much about West Virginia personally, but I think it goes along with some of my beliefs about the Midwest that affordability is going to drive performance for a lot of places. You see some negative things about the West Virginia economy, so that would be my major thing. But if job growth is happening in Morgantown in particular, that would alleviate-

Henry:
Jomp growth and population growth.

Dave:
Yeah. I mean, that’s true. If you have both of those things, then maybe Morgantown is one of the areas in West Virginia that has grown. So I like it. It’s very affordable. Good place to get into the market, probably going to get good renters. So I like it. All right, let’s take a quick break, but when we come back, we will do around three of our best places to invest in 2026 discussion. We’ll be right back. Welcome back to the BiggerPockets Podcast. I’m here with Ashley Kier and Henry Washington talking about our favorite places to invest in 2026. And I am going with a place that I have actually long thought about investing in. I’ve been looking at deals here for like four or five years and have never pulled the trigger. It is Kansas City, Missouri.

Henry:
Oh, man. I

Dave:
Like Kansas City a lot because it is … If you look at the geographic center of the country, it’s like plop in the middle and it’s like the major intersection of highways and railroads, which makes it one of the logistics capitals of the country just for infrastructure and logistics, which is a really recession proof thing. And I really just like those kinds of solid, blue collar kind of jobs that get a lot of investment from the government, that get a lot of investment from the states. You get a lot of colleges there. There’s just all sorts of stuff going on in Kansas City, but it’s still super cheap. The median home price is 280, rents around 1,500. So cashflow is possible, but the things that I really like about it is just the straight up affordability. The home price to income ratio is 2.3, which is really low.
The country as a whole is about 4.4. So just you can buy a lot of house with your income there. And I think that bodes well for housing demand. It’s also one of the few cities in the country still that is not rent burdened. If you haven’t heard that term, economists, budgeting, personal finance experts say that if you spend more than 30% of your income on rent, you are rent burdened. And like most cities in the country, like the average person is rent burdened, not in Kansas City, which makes me feel like I would be able to find tenants who can pay. I’m not going to have problems collecting rent. And it means that there is potential for rent to grow in the future. Both are good things. There are a lot of investments going in the area. Panasonic just put in a battery plant.
Garmin is expanding in the area and perhaps more important than everything. Kansas City has more barbecue restaurants per capital than any other city in the world. This is true. It’s fast. And I’m going to get a lot of hate for this. I like Kansas City Barbecue. I’m a big fan of Kansas City style barbecue and I want to go eat there. And Henry, you and I talked about this all the time. I like to invest places I like to go eat. And so Kansas City is very high on that list.

Henry:
Kansas City Barbecue is delicious. Kansas City is kind of a conundrum. It’s interesting because a lot of the development on the Kansas side is fairly new.That’s where I think they have a NASCAR track that’s on the Kansas side. I believe the MLS team, the soccer team has a big stadium that’s on the Kansas side and like lots of new stores and infrastructure. So lots of restaurants, outlet malls, the casino I believe is on the Kansas side. So investor heavy market, so lots of competition.

Dave:
Yeah, that’s true. I think that is a good point.

Henry:
But again, lots of small multifamily. It’s a market where you can get lots of small money, but also lots of older buildings, older homes. So you got to deal with the problems that come with those things. But I like the market. Yeah.

Ashley:
Do you guys have a preference as far as which side of the city you’d rather invest in?

Henry:
Most people invest in the Missouri side because that’s where most of the housing is. There’s not a ton of housing on the Kansas side. Yeah.

Dave:
Okay. All right. So that’s my first one. Henry, what’s your round three pick?

Henry:
Round three. My round three prick is one that I didn’t really know going into this, but it is Peoria, Illinois.

Dave:
Oh yeah. This is like on the top of every list right now.

Henry:
So I picked Peoria, Illinois because again, the pricing and fundamentals are ridiculous. What do you think the median house price is in Peoria, Illinois? 220?

Ashley:
180.

Henry:
167.

Ashley:
Whoa. Okay.

Henry:
Wow. 167 with a median rent of about 1260, so just under 1300 for median rent. So again, 0.75 rent to price ratio. Vacancy’s high though. 12% vacancy. So that means people have options. So you got to make sure your rental’s on par. One year job growth, 1%, five-year job growth, about 2%. But the reason I added this to my list was I wanted something that had a little bit bigger of a metropolitan area compared to my other two. Population of about 400,000, so 398,000. Wow. The city of Peoria itself is 110,000, but the metropolitan area puts you at about 400,000, which for that price point is pretty unusual to be able to have a … Because that lets you know that there’s people. People are living there. Population is average population growth, average job growth, which is solid.

Dave:
Yeah. Wow.

Henry:
The top employers in the area, again, healthcare, OSF healthcare, 14,000 regional employees. Healthcare’s massive there. Then Caterpillar, the heavy equipment brand, 12,000 employees

Dave:
There. Oh, okay.That’s big.

Henry:
So you’ve got jobs in heavy machinery, you’ve got jobs in healthcare, you’ve got them spending money again on revitalizing the downtown area. I mean, Illinois, as we showed on the Cashflow Roadshow, is just a great market where you can buy cashflow, and this is no exception to that. If you don’t want to be in the hustle and bustle of Chicago, then you can still find great numbers in a place where you’ve still got a decent sized metropolitan area. You’ve got lots of small multifamily options there. I mean, at those numbers, you can absolutely buy something on the market that makes sense. And so if a big city like Chicago scares you, even though it cashflows, then you can go out to a less industrial city and you can still find great numbers. So there’s markets all over the country in these little pockets where if you look at the fundamentals, the fundamentals make sense.
Are they the sexiest places in the world? No, they’re not the sexiest places in the world, but some of these numbers are pretty sexy.

Dave:
Honestly, there’s so many times we have people come on the show and they’re operating in their hometown. And maybe if you live in a big city or you’ve never been to these towns, they seem kind of random, but there’s absolutely great fundamentals and they’re easy to get to know and there’s less competition to Henry’s point earlier. There’s a lot to really like. I hear these people just investing in their hometown, cities of 50,000, 100,000, 200,000, people doing great, doing fantastic. Sometimes I’m just jealous. I’m like, man, that’s just a manageable market with low competition. You could probably do really, really well there. And so I like these kind of markets, especially if you just commit to it and just like, I’m going to learn this market, like the back of my hand, you’re probably going to do very well.

Henry:
Yeah. I mean, and that’s what you have to do. I see all the comments on posts like, “Oh, you could buy cheap houses, but nobody wants to live there.” Look guys, you’re not going to find a major metro with super cheap houses that nobody’s ever heard of, that you’re going to be able to buy a house and make a ton of cash flow. You’ve got to look at some of these ancillary markets that are closer to some of these big cities, which you’ve got some examples of in this show. This is what you want to do. Yes, there are sub $200,000 homes in America, and there are markets where those homes exist and you can make money. So what we’re trying to do is show you where you can go and find some of these amazing fundamentals. Like I said, they’re not going to be the sexiest places in the world, but we don’t need the place to be sexy.
We just need the cash flow to be sexy.

Dave:
All right. Well, I like it. It’s another good choice. Ashley, round us off. What’s your third round

Ashley:
Pick? My last one is Winston-Salem North Carolina.

Dave:
I almost did this one. It’s a good market.

Ashley:
This metro population, 684,000. The median home value, 250K to 280. The typical rent for a single family home is around 1,600 per month. The vacancy rate is 9%, 2% employment growth. This stood out to me here in the last five years, there’s been 2.6 billion in investment in the area, making 6,600 new jobs. And right now in the pipeline, there’s 11 billion in planned development that would lead to 18,000 potential jobs. So the major kind of industries, the employers here are … Wake Forest has a big healthcare system, Atrium Health, Wake Forest Baptist. Of course, the university, there’s a 330 acre innovation quarter and then a lot of corporate and manufacturing. The Haynes brand is there. And then some government services in there too.

Dave:
I really like Winston-Salem. I almost picked this city as well. I like everything going on in North Carolina, to be honest. I just think it’s a really solid state. There’s so much to like about the economy, population growth, just everything going on

Ashley:
There. Low property taxes, land friendly.

Dave:
Low corporate taxes, so a lot of businesses are moving there. There’s just a lot to like in North Carolina. And Winston-Salem is still relatively affordable compared to Raleigh, Durham, which has exploded over the last couple of years. Charlotte’s gotten is still relatively expensive for how big of an economy it is. But Winston-Salem, Greensboro, which is close, they’re both a little bit more affordable. So I’m all in on this place. I love this one actually.

Henry:
Well, that’s what I was going to say is you’ve got that sister city of Greensboro, which is about a similar size to Winston-Salem and only about 30 minutes away, which in the grand scheme of driving is like the same city. So you really get a two for one with this market.

Dave:
All right. Well, very good one. I’m not going to argue with this. I don’t know. Are we picking winners? Ashley, you win this round.

Ashley:
I’m just going to keep doing the same strategy. Piggyback off of another great one. We did another time.

Dave:
I like it. Well, I don’t think we awarded anyone a winner for the second one. So Henry, we’ll award you that winner. So we each win one and we all feel good about ourselves. And we’ll come back to do this again later this year when we do it because I’m joking, but I really think this is valuable because one, these are good markets. If you want to consider for yourself, if you’re investing out of state or you’re just trying to learn how to research markets, hopefully you see the thought process here. There’s a lot of things that Ashley, Henry and I are talking about, whether it’s economic growth, population growth, but ultimately it really comes down to your own strategy. Ashley picked a place in Florida that I wouldn’t choose, but is great for certain people. Henry picked Morganstown, West Virginia. I probably wouldn’t invest there.
It probably works really well for certain people. Whereas I’m sure Ashley and Henry probably wouldn’t invest in some of the markets that I picked. And so the key thing here is to learn the variables and the data that you should be thinking about because then going out to get it is pretty easy. You can look this stuff up on Zillow or Redfin or ChatGPT. It’s just learning the process of thinking about which markets to invest in. That’s why we do these episodes, not because we want you to pick one of these nine markets in particular, but just so you can see how to think through these questions.

Henry:
We’re not trying to tell you where to invest, but Dave, come on, the people want to know. If we had to pick one of these nine- Ooh, that’s a fun one. What’s the one we would pick? What’s the grand winner that we would choose to invest in? I’d hands down know which one I would choose.

Dave:
All right, go.

Henry:
I’d choose Connecticut.

Ashley:
I think I’m going with Illinois.

Dave:
Henry’s going with Hartford. Ashley’s going with Illinois. It’s funny, we’re all picking up. Actually, I think I’d go with Knoxville, Tennessee, I think is the one I would pick.

Henry:
Why Knoxville for you?

Dave:
I think I said it earlier. I just like that it’s solid right now, but I think it is long-term upside. There’s a lot of markets in Tennessee that have gotten too expensive and overgrown, and I think Knoxville has some potential to run still. I like that it’s a state with no income tax. I like that there’s a big university there. So I think there’s just a lot to like there.

Henry:
I like Connecticut for the density. There’s always going to be growth. People are always going to live in this area because of the pricing of New York City, because of the pricing of Boston, and because those markets are so amazing, there’s always going to be jobs in those markets. So a market like this is always going to see people living there. They’re always going to have jobs and you can get great small multifamilies. So I would be looking for that four to 10 unit property in this market that doesn’t need a ton of work that can make some cash flow now, but be a cashflow monster in the future.

Dave:
Well, let us know in the comments which of the nine that you would pick, or if you think that there’s something way better and we missed the obvious one, let us know in the comments as well. And we will be back with another one of these episodes in a couple of months because we love doing this one. It’s a lot of fun, even though it takes a lot of work and research for each of us. Hopefully you enjoyed this episode. Ashley, thank you for letting us borrow you from the Real Estate Rookie Show. We appreciate you being here.

Ashley:
Yeah, thanks so much for having me. I always love a good homework assignment.

Dave:
And thank you, Henry, for joining us as well.

Henry:
Thank you, sir.

Dave:
And that’s what we got for you today on the BiggerPockets Podcast. We’ll see you next time.

 

In This Article

Slow doesn’t have to mean no cash flow. Just because most experts have predicted a monotonous real estate market for 2026, with no crash or boom, doesn’t mean there aren’t still opportunities for disciplined investors.

“Housing demand is constrained by a lack of affordability—high prices, elevated mortgage rates—while rising fears of joblessness are further depressing homebuyer appetite,” James Knightley, chief international economist at ING, told Reuters. “At the same time, supply is on the rise, with insurance and property taxes putting financial pressure on stretched homeowners.”

If all that sounds a bit morose, even in the light of three interest rate cuts from the Federal Reserve so far, the good news is that history has shown us that malaise in the market doesn’t last forever. Rather, they offer long-term investors a chance to strategize and align their finances for when the market picks up again.

An Equity Hiatus

Real estate analytics site Cotality offered some specificity on the current state of the market, reporting that home price growth slowed from 3.4% in January 2025 to 1.1% in October, the lowest rate since 2012. Meanwhile, a Reuters poll of property experts predicted that home prices will rise just 1.4% in 2026, while rates will remain above 6%.

The truly sobering news for investors is that amid a stultified market, Cotality reported that single-family rent growth slowed to a 15-year low by late 2025, with many large metros seeing flat or even slightly declining rents as large numbers of multifamily construction hit the market. This was echoed by CNN, citing Bank of America data. 

While this gives respite to cash-strapped tenants, it does little to assuage the concerns of investors worried about higher expenses, such as taxes, insurance, and maintenance.

“No Cash Flow Mention ’Til ’27”

A couple of years ago, during the dying days of the Biden administration, investors were being advised to “stay alive until ’25.” Now it appears that the cogent advice is “No cash flow mention ’til 27.” 

Redfin, as quoted by CNN, has labeled 2026 “The Great Housing Reset” and projects that rents could increase by roughly 2% to 3% year over year by the end of 2026, as the delivery of new apartments slows.

For smaller landlords who wish to remain active in the market, this means underwriting deals with conservative rent assumptions and focusing on submarkets where local growth supports steady occupancy.

Finding Opportunities in a “Boring” Market

Warren Buffett’s sage advice on investing is worth remembering in today’s market: “Be fearful when others are greedy, and greedy when others are fearful.” Because rents and home prices are not soaring amid relatively high interest rates and affordability concerns, many buyers are sitting out a stagnant market. This means with less competition, this is an ideal time to buy.

Many investors have taken this advice to heart, choosing the lack of homeowner activity to scoop up deals. Cotality’s investor data shows that investors accounted for just under one-third of single-family home purchases through October 2025, spending about $483 billion. That spending was primarily focused on long-term rentals rather than short-term flips.

A Nuanced Picture

The U.S. real estate market is never a one-size-fits-all for investors, as regional differences are pronounced. This is where prospective landlords can take advantage. Looking for increased inventory and increased days on market can offer insights as to where to find deals.

Cotality’s December 2025 report noted that the Washington, D.C., area had a record 60% year-over-year jump in inventory in November, following federal layoffs and a government shutdown. The nearby Frederick-Gaithersburg-Bethesda, Maryland, area saw a 68% increase in inventory year over year, with days on market rising rapidly as well.

There was a similar story in several Western and Sunbelt states, according to Realtor.com, where price cuts escalated as inventory climbed back above 2019 levels, as buyers balked at 6%+ interest rates. Although national prices were still up by 2.3% year over year through August, softer conditions in several states create more favorable buying conditions.

Practical Moves for Investors for 2026 and Beyond

Focus on the things you can control

“Small wins rather than slam dunks” should be the general real estate investment motto for 2026. Of course, no one would turn down a big payday if they come across it, but they might be a bit thin on the ground.

Instead of a big flip, soaring equity, or expansive rent growth, focusing on the things you can control, such as intelligent financing, clever property choices, skilled price negotiation, and smart management choices, is the prudent way to address investing this year.  

Eliminate debt

Starting from a clean slate helps when planning for the future. Simply saving W-2 or rental income and paying off debt, including consumer debt, helps increase cash flow without raising rents or taking out new loans. Stacking reserves also means you will be better placed to secure financing when you are ready to pursue a deal, instead of going to a lender seeking maximum leverage.

Curate a “buy box”

Start analyzing regions and neighborhoods that fit your investment criteria. Rising rent growth, job availability, and low insurance and tax rates should all play a part in your decision-making. 

If you find your ideal investment choice is in an area you do not live in but would consider, your first investment could be an owner-occupied small multifamily, which you could secure with an FHA loan and house hack, thereby lowering your expenses while you look for more opportunities.

Use your existing equity wisely

This reset period could be a good opportunity to access your accumulated home equity to purchase a new property, complete repairs on existing properties, or reposition financing, all with the goal of increasing cash flow and paying down additional debt before investing again.

Final Thoughts

One of the best cash flow strategies for 2026 amid a stalled market is investing in small multifamily rentals, which are likely to give an investor more bang for their buck than single-family homes. These days, that does not refer solely to two-to-four-unit buildings, but can also include a single-family rental with an additional ADU. Even adding a finished basement to an existing rental property to increase cash flow could be a win-win. 

The bottom line: Work with what you’ve got. Taking out extra loans and leveraging when you can increase cash flow with your current portfolio, or purchasing more than one unit at once—thus mitigating risk across units—is a savvy move in a stagnant market when money is tight.

The Midwest seems to be the best place to invest in 2026 based on its affordability metrics. LandlordStudio’s 2026 guide identifies Cleveland, Indianapolis, Columbus, and Kansas City as top cash flow markets due to entry prices of $150,000 to $300,000 and targeted 8%-12% cash-on-cash returns for well-run rentals.

PropStream’s Top Affordable Real Estate Markets For New Investors 2026 is of a similar mind, emphasizing that positive cash flow is to be found in metros with below-median house prices and solid rental demand.

In This Article

The announcement that President Donald Trump plans to buy $200 billion in mortgage bonds using cash reserves at Fannie Mae and Freddie Mac is the latest White House strategy to lower interest rates and address the affordability crisis.

For real estate investors, anything that moves rates down must be seen as a positive. How low rates will go, however, is another question.

How Trump’s Mortgage Bond Plan Works

The president released a statement on Truth Social on Jan. 4 detailing his strategy for the bond buy:

“Because I chose not to sell Fannie Mae and Freddie Mac in my First Term … it is now worth many times that amount—AN ABSOLUTE FORTUNE—and has $200 BILLION DOLLARS IN CASH.

I am instructing my Representatives to BUY $200 BILLION DOLLARS IN MORTGAGE BONDS. This will drive Mortgage Rates DOWN, monthly payments DOWN, and make the cost of owning a home more affordable.”

Realtor.com explained that the shift effectively turns Freddie and Fannie into large, price-supporting buyers of mortgage bonds, similar to pension funds, insurers, and the Federal Reserve.

How Buying Mortgage Bonds Can Move Rates

Here’s a The Big Short-type recap: Mortgage-backed securities (MBS) bundle many individual home loans into bonds that investors buy. Mortgage rates track the yields on those bonds more closely than they follow the 10-year Treasury. When there is strong demand for MBS, prices for those yields fall, which can result in slightly lower rates for borrowers, stemming from lenders repricing new loans against cheaper funding costs.

“There is no question if Fannie and Freddie get back into buying mortgage bonds for their portfolios, mortgage rates will undoubtedly fall,” David Dworkin, president and chief executive officer of the National Housing Conference, a coalition of affordable housing providers, told the New York Times.

“If you look at all the factors that made rates incredibly low from 2020 through 2022, a large influencer was that the Fed was buying mortgage-backed securities,” Jennifer Beeston, executive vice president of national sales at rate.com, told Realtor.com. “When lenders know there’s an end buyer lined up, they can offer lower mortgage rates.”

Realtor.com’s Jake Krimmel put it in perspective, stating that “a one-time infusion of $200 billion—or a series of smaller purchases that add up to it—are not likely to change the mortgage market’s long-term pricing.” 

During the pandemic, the Federal Reserve’s MBS holdings swelled to almost $2 trillion after consistent buying. The comparison illustrates why many analysts feel the end result might be limited.

“This could boost GSE revenue in the short term, but buying to intentionally reduce rates has very limited upside,” Michael Bright, a former manager of Ginnie Mae’s portfolio of mortgage bonds, told MarketWatch.

A Note of Caution

Before the 2008 financial crash, Fannie and Freddie created sizable investment portfolios by buying MBSes, which included risky subprime loans. When defaults spiked, those holdings became toxic, leading to a government bailout and a permanent conservatorship that exists today. More MBS buying is bound to trigger bad memories, even though underwriting requirements are far more stringent now than they were before the financial crash.

How Trump’s $200 Billion Bond Move Could Affect Smaller Investors

For landlords of all sizes, the question regarding the president’s latest strategy is, how will it affect interest rates?  As analysts interviewed by MarketWatch said, the dip could be modest, shaving a few tenths of a percentage point off a 30-year mortgage rate.

Taken in context, over the life of a loan, that could still add up, and for investors, the additional cash flow it could engender, through refinancing and new purchases, could make a meaningful difference in the battle to stay afloat. 

For example, as Realtor.com illustrated, on a $400,000 loan, if the rate drops from 6.16% to 5.75%, the PITI would decrease by $96 per month, resulting in $34,560 in savings over the life of the loan.

Home Prices Have Nearly Doubled Wage Growth

For investors, the more mortgages with fixed-rate debt they have, the more they could potentially save. However, the fundamentals of the housing market, which could really move the needle, won’t be affected by a nominal rate cut. For that to happen, there needs to be a greater supply of homes. 

Bankrate suggests there is a shortfall of about 4 million homes in the U.S. housing market, which is affecting house prices. However, as the website reports, this is highly regional, and in some markets where prices are too high to attract buyers, they are falling.

Real estate analytics company ATTOM’s G4 Home Affordability Report found that home prices have continued to outpace wages, particularly in pricey coastal areas, contributing markedly to the affordability crisis.

Rob Barber, CEO of ATTOM, said:

“Many Americans were priced out of buying a home in 2025, and affordability remains worse than historic norms in most markets. Still, modest, quarter-over-quarter affordability improvements in many markets at the end of the year offered some encouragement. Over the past five years, home price growth has nearly doubled wage growth, meaning homebuying power in 2026 will depend not only on whether prices level off or decline, but also on mortgage rates and broader economic conditions.”

Without a sizable increase in supply, a rate cut could have a more adverse effect on housing than intended, pushing prices up.

“If consumers are able to afford more homes because monthly payments are lower, home prices tend to rise more quickly,” Gennadiy Goldberg, head of U.S. rates strategy for TD Securities, told CBS News. “So simply lowering the cost of buying a home through the mortgage channel isn’t sufficient to fix the problem in the long run.”

Final Thoughts:  Practical Moves for Investors

Many of the president’s recent creative financial plays, such as proposing to ban Wall Street from buying single-family homes and now the $200 billion mortgage bond buy, are unlikely to create seismic shifts in interest rates or the availability of homes. But cumulatively, they could help edge rates down, and that’s what real estate investors need to watch. 

The practical move is to take the opportunity to refinance once rates drop—even by a few tenths of a percentage point—to create some extra cash flow and claim a small victory. In a challenging real estate market, every win helps.