This article was originally published in April 2018 Think Realty Magazine.
Memphis Investment Properties (MIP) has been actively investing in the Memphis, Tennessee, real estate market for nearly four decades. the company offers complete turnkey real estate investing services, meaning that real estate investors who wish to own rental real estate in their portfolios but do not have the time or inclination to oversee the purchase, leasing, and management of those properties can turn the entire process over to MIP professionals. It also means that MIP itself has, of necessity, established a clear-cut system for local market analysis that enables the team to identify undervalued but stable neighborhoods in which to make investments on behalf of their clients.
Think Realty Magazine sat down with several members of the Memphis Investment Properties team, including investment broker James Wachob, dispositions manager Mark Hart, and vice president of operations Sean Tagge, to break down the company’s current take on the local market and how they reached their conclusions.
Think Realty Magazine: What is your favorite real estate investing strategy for Memphis right now?
Kitchen before
MIP: Turnkey properties and new construction properties offer the most consistent returns in today’s Memphis market. In today’s competitive market, the key to generating successful returns from the start is keeping those maintenance requests to a minimum, since that is where your costs will add up fast. We recommend installing several “maintenance preventers” in your rental properties, such as hard-surface flooring, new roofs, new HVAC, and new plumbing. Factor the costs of these updates into your budget when you purchase a rental property, and you will nd that they pay for themselves in prevented maintenance quickly!
Kitchen After: Hard-surface flooring, marble countertops, and modern cabinetry and design make this kitchen attractive to both rental owners and tenants thanks to a combination of maintenance prevention and updated design.
We also have a big demand these days from our renters for new construction homes. Of course, new construction also tends to o er low future maintenance and they are more energy efficient. We are seeing very good comparisons between rents in our area and the average price of homes, both new construction and existing, in our area. Even with our practice of bringing all our rental properties up to 2018 standards buying turnkey properties in Memphis is still a great approach for investors looking for passive cash flow.
TRM: Where in Memphis area do you invest?
MIP: We look at a number of factors when we decide where to invest. e most important thing is to own property where people want to live! Areas that are desirable due to proximity to local employers like FedEx, Nike, and St. Jude Children’s Hospital, for example, tend to be in demand and stable. A few specific neighborhoods include:
- Hickory Hill
- Whitehaven
- Cordova
- Millington
TRM: What makes your market unique?
MIP: Memphis has a history of stable home prices and strong rental demand thanks to strong blue-collar jobs that create an ongoing need for workforce housing. It is also a logistics hub, meaning that it is the center of a lot of companies’ shipping operations. In fact, Memphis is known as “America’s Aerotropolis” thanks to the convergence of runway, river, rail, and roads in the city.
Our western border is the Mississippi River, which gives us access to two major inland ports, while I-40 runs coast-to-coast directly through Memphis and I-55 runs north-to-south directly through Memphis. Most recent on the roadway side of things, I-69, also known as the NAFTA superhighway, runs from Canada to Mexico – again directly through Memphis! We also have ve of the seven types of class I railroads.
TRM: What is your proudest moment in real estate?
MIP: We experience our “proudest moment” every time an investor succeeds in achieving the dream of passive income from rental properties that exceeds their living expenses. It is our great pride to enable investors to be able to be truly financially independent. We are proud to provide a path to financial freedom for the individual investor and also to generational wealth that can be passed on to future generations.
Memphis Investment Properties will host its annual Live Event, which includes a chartered tour of the market’s hottest rental areas guided by MIP’s team of turnkey rental experts, May 18 & 19, 2018. The MIP team may be reached at www.ThinkMemphisRealEstate.com
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