Dawson Creek.. solid first investment?

[Dirk]

Hey guys,

My partners and I are looking to purchase our first investment property. From our understanding we want to get a property that appreciates so that we can leverage it to build up our portfolio.

Our situation:
- 3 guys with 40k pooled together (cash flow is critical in order to pay back some of that capital asap)
- we live in Vancouver
- because cash flow is so essential we are looking to avoid any mortgage insurance therefore can only afford a 200k house

Our game plan thus far: Dawson creek seems to be optimal for several reasons

- High rents due to demand from the energy industry (quoted from a Realtor 3b up $1500 / 2b down $900 for roughly 200k)
- recent investor interest
- town is seemingly poised to boom

Would Dawson Creek be a good town for our first investment property with our intention of maximizing cash flow and appreciation?


Thank you everyone for your input.

 

[Thomas Beyer]

QUOTE (Dirk @ Feb 9 2010, 08:43 PM) ..
Would Dawson Creek be a good town for our first investment property with our intention of maximizing cash flow and appreciation?
yes, one of many locations, BUT:
a) what can you buy for 200K ?
b) who will mange it from afar .. hard to find manager for one house !
c) how often do you intend to go there to scout deals / areas and who will pay for it ?
d) how long will the shale gas opportunity last i.e. how / when to exit ?
e) how to pay for damages to property if poor tenant is picked ?

Why not closer to home, say: Surrey, Burnaby, Abbotsford, Mission, Maple Ridge ?

Perhaps some other partners are needed .. those with CASH !

Don`t partner with folks that have what you have .. partner with folks that have s.th. you do not !

 

[Dirk]

QUOTE (ThomasBeyer @ Feb 9 2010, 11:45 PM) yes, one of many locations, BUT:
a) what can you buy for 200K ?
b) who will mange it from afar .. hard to find manager for one house !
c) how often do you intend to go there to scout deals / areas and who will pay for it ?
d) how long will the shale gas opportunity last i.e. how / when to exit ?
e) how to pay for damages to property if poor tenant is picked ?

We have found quite a few properties in Dawson Creek that fit the 10% rule for around the 200k mark.
Will property managers not manage only one property?
I would imagine with all the recent investments into the area from developers and energy companies it would at least last 5 years... in which we hope to have created some appreciation in the property to then sell and use for another down payment in another location.

What would you recommend as the best course of action in our given situation?