Investing in real estate in Kansas City can be highly lucrative, but only if you know where to look. With a booming economy and affordable housing market, Kansas City has become an attractive destination for out-of-state investors. However, navigating the local market can be tricky. Here are some tips on how to find the best investment property deals in Kansas City.
Analyze population and job growth in suburbs
The Kansas City metro area spans two states and dozens of suburbs. Pay attention to population and job growth when deciding where to buy investment properties. Olathe, Overland Park and Lee’s Summit in Kansas are fast-growing suburbs with strong demand for rentals. In Missouri, Belton and Grandview are more affordable options seeing rising rents.
Look for up-and-coming neighborhoods
Established neighborhoods like Brookside and Waldo are hotspots for investment property in Kansas City, but prices there carry premiums. For better cap rates, look just outside these core areas. Neighborhoods like Blue Valley, Red Bridge and Green Hills are still close-in with solid growth potential. Connect with a local real estate agent to identify up-and-coming areas.
Search for small multi-family properties
The Kansas City market is filled with duplexes, fourplexes and other small multi-family buildings. These can make excellent investment properties in Kansas City, offering multiple units with one purchase. Focus your search in working-class neighborhoods, where these small properties are abundant. A multi-family purchase can generate enough rental income to cover the mortgage.
Look for fixer-uppers at auction
One way to find discounted investment properties in Kansas City is by searching auction listings. Many auctions feature distressed homes and fixer-uppers that can be purchased below market value. Do your due diligence to calculate rehab costs for any property you bid on. Attending auctions in person also allows you to get a feel for local market demand.
With proper research and local market expertise, investors can find lucrative deals on investment property in the Kansas City area. Focus on high-growth suburbs, up-and-coming urban neighborhoods and small multi-family buildings for the best opportunities.