Did We Just Find 2024’s Most “Under-the-Radar” RE Market?

Dave:

If you’re anything like me, you probably spend a lot of time hunting for new markets and trying to figure out what strategies work in those markets, but I’m guessing that most of you aren’t like me and don’t spend your time just researching random markets. So instead of making you do that today, we’re going to bring you some under the radar markets that might work with your strategy. Hey, what’s going on everyone? This is Dave Meyer and with me today is the whole gang. We’ve got Kathy, James, and Henry joining us today, and what we did is I asked each one of them to research and find an under the radar market to share with us today, and I did the same. James, how’d it go for you? Was this a hard assignment? You

James:

Know what? These are always a hard assignment. I start going down the rabbit hole and all of a sudden I’m in all 50 states looking at every city, so it took me a while to find the right one.

Dave:

Henry, are you just sticking with Arkansas? You’re just like a one trick pony. Did you follow the assignment this time?

Henry:

It was very hard not to pick Arkansas. You just love it. But I did pick a market that has strategies that I only do a little bit of right now, but that I want to do more of, so I wanted to bring something different to the audience because everybody’s used to hearing about buy and hold in Arkansas for me.

Dave:

All right, well I’m excited to hear that. Kathy, how many different data sources did you look at to research your market?

Kathy:

I probably cheated a little. You guys. This is the end of my due diligence on this market. I’ve already been to it and researched it, so it’s been a three month process, so I’m sharing that with you today.

Dave:

Well, that’s not cheating. If we’re getting the results of three months of your work, I’m very happy for that. Well, you can see why we’re doing this show for you all because it does take a lot of work to research individual markets and hopefully you like the four markets we’re going to be discussing today, but if none of these match your strategy and you are looking for a market, I have a very exciting announcement for you. BiggerPockets has just launched a brand new tool. It’s called the Market Finder. You can find it at biggerpockets.com/find a market. This is something I’ve personally been thinking about and dreaming about and trying to make it BiggerPockets for years, and it’s finally here so you can do all your research on BiggerPockets and we have a new listings platform, so once you find a market, you can go and find a deal right in that market. Go to biggerpockets.com/find a deal. Really check them out. They’re super, super cool. Really high value in art of these new developments. We thought we’d bring back this popular idea of under the radar market. As I said, we’re each going to present a market and hopefully you can learn not just about these four markets, but how each one of us thinks about different markets to invest in. So let’s jump in.

All right, so I drew the short straw and I am going first in today’s market description and I don’t know how I became a Midwest market pusher over the last few years because I’ve never lived in the Midwest. I have some family there, but I don’t know why. I just like being a contrarian and everyone’s always investing in the west and the southwest, and I’ve just decided to make the benefits of investing in the Midwest, my personal cause over the last few months. And so my market today is Des Moines, Iowa. I’ve never been there. Have any of you been there? Nope.

James:

Nope,

Henry:

I have not.

Dave:

Okay. Wow. I don’t know if that bodes well for this market, but I feel like

Kathy:

None of us are Buffet fans then or something.

Dave:

Hey, wait, Warren Buffett. Yeah, he’s Omaha. Oh, see you guys don’t even know the Midwest at all.

Henry:

I was going to pick Omaha for my market, so I learned a lot about Berkshire Hathaway.

Dave:

Omaha’s a good market. Just

Dave:

Cut that section. Just cut that

Dave:

Knowing about No, we’re keeping it. Kathy.

No, I unfortunately don’t know any facts about Des Moines except that the population size is 211,000 people and unlike some areas of the Midwest, it is growing 1.1% year over year, which is tied with Madison, Wisconsin for the fastest growing Midwestern city, which I like because you do see a lot of areas, particularly in places like Ohio, some areas of Pennsylvania, Michigan, you see that we are losing some population and so that is really beneficial and despite that growth, the unemployment rate in Des Moines, Iowa I think might be the lowest I’ve seen of any market. I’ve researched at 2.6%. Now I don’t want to spoil it, but do any of your markets have unemployment rates that low? Nope.

James:

That’s

Dave:

Pretty low. Yeah, I didn’t think so. Alright, Midwest for the win. Okay, we also had rank growth of 6%. Some businesses are moving there and the thing I really like about it is that it is an affordable city. The median home price is about less than half of the median home price in the US at 207,000 and appreciation over the last year was nearly 7%. So given what I just told you guys about the stats in Des Moines, what do you think? Do you think this is a reasonable place? Maybe we should all go visit.

James:

It’s not on the top of my visiting list right now.

Dave:

Anyone jump in? No one wants it. No one likes

Henry:

It. I just didn’t want to walk all over somebody. I have an opinion.

Dave:

Okay, what’s your opinion, Henry? Tell me how dumb it is.

Henry:

No, I don’t. I like the dynamics. Like I said, I was looking at Omaha, Nebraska, which isn’t very far from Des Moines, Iowa, and I think the only thing that kept me away from using Omaha as my under radar radar market is that I just wasn’t comfortable with the employers in that area and their growth in those industries. So my concern with the Des Moines and the Omaha is that we don’t have strong employers that are employing the majority of the population there, and so I would be scared to invest long-term, but the dynamics of the market seemed great.

Dave:

I do admit, I agree with you Henry, when I was looking at the biggest companies in Des Moines and who the major employers were, there weren’t that many companies that I recognized as big industry leaders, so that was a little bit concerning to me, but it does have strong manufacturing, agriculture, those sorts of things that tend to be pretty stable. But I do agree with you, there’s not a lot of big sexy companies, jobs, people moving there in any significant way.

Kathy:

James and I like sexy, so it’s probably not on our list.

Dave:

Just crickets over there.

Kathy:

I’m just going to blame it on my California education. I’m going to pull that card where we just don’t know geography, Omaha, Des Moines, we don’t know, but seriously, I do normally love an off the radar market like this because you just don’t maybe have the thousands of investors flocking in and you kind of can own your market. So I think if you dove in, knew it well, you could do very, very well. You don’t have everyone else competing.

Henry:

You don’t have you. California’s coming in and buying up all our real estate,

Dave:

They don’t even know how to find it. They can’t even get there.

Kathy:

Give me a map. Let’s see how I do. It’s not going to be good.

James:

I think they call this the flyover state for a reason. Oh,

Dave:

I knew someone was going to say that and now James is going to get all the hate in the comments, so that’s fine. We just hate hate on James instead.

Kathy:

Yeah, forget about me. Just point it at James.

James:

Yeah, they call Iowa the fly over state and I’m going to fly right over investing there. It’s not for me. It’s a little too slow grind.

Dave:

Fair enough.

James:

I don’t want to visit, I don’t want to invest there. Not

Henry:

Enough juice.

James:

There’s no juice for me. Yeah, I’m going to apply right over to a juicier market. That’s what I’m going to do.

Dave:

Alright, fair enough. Well, I will tell you this, the reason I came up with Des Moines was I was actually working on that deal finder tool that we’re launching at BiggerPockets and I was just clicking around and it does some cool stuff where it shows you what the expected cashflow might be and what the rents are and so you can find the idea is find deals on the MLS and I was just clicking around and Des Moines and there are good cashflow on market deals that are in good areas for like 200 grand. So I understand for people like James that doesn’t the rent even a six, 7% cash in cash return on a 200 doesn’t pay for a yacht, but for those of us who are still trying to build their portfolio out, this could be a good option. Good appreciation, good cashflow. So that’s why I picked Des Moines. Okay, so you’ve heard now my very compelling case that no one can deny about why you shouldn’t snooze on Des Moines. We’ll ask what markets James, Kathy, and Henry have up their sleeves and we’ll find out right after the break. Welcome back to On the Market. Today we’re talking about underrated markets. Alright, well that’s what I got to say. Now we got all the Midwest out of the way. We can now move on to parts of the country that Kathy could potentially identify on a map. Let’s hope because you’re going next Kathy. So let’s see if you could tell us what state your market is in.

Kathy:

This is not going to be much of a surprise to anyone, but it is Texas, but I’m going to be giving away another secret that I hate doing because now it’s not going to be an under the radar market. Well, I’m sure a lot of people know about it, but we’re talking about San Antonio, bear County spelled B-E-X-A-R. Don’t say it wrong, it’s bear. And within that market people often will say, oh, I like Tampa or San Antonio or Dallas, but it’s really within the market that matters. Where’s the migration? So there’s this little town called Burn and it is just exploding with growth in the San Antonio area. San Antonio in general. It has 2 million people. I like that. I like to be in cities that have at least a million people. There has been a 1.2% increase year over year in population and the latest census report said, okay you guys, I’m giving away my secrets.

It’s been three months, but here we go, the fastest growing city in America right now. So there you have it and a lot of people don’t realize that it’s the seventh largest city in the US but it kind of still feels like a small town. It’s huge and people love it even though it has that small town feeling, especially Bernie, it’s just adorable, cute little Texan town, 22,000 people migrated there in 2023. The mayor is freaking out a little because there’s so much growth coming, they don’t know how they’re going to house people. That’s an opportunity. That’s what we’re doing. The unemployment rate, not as good as Des Moines, but 3.2% down from 3.7, which to me is a healthier market because in Des Moines, if you’re trying to find workers you’re going to have a harder time. There’s barely any, the unemployment rate is so low there.

So I kind of like that it’s a little bit higher but still just a robust economy and growing rent growth has slowed because there is more supply coming on, but to me that’s okay. I’m looking in the future and I just talked to a demographer recently and he said that area between San Antonio and Austin is the fastest growing in the nation as well, which is basically what the census said. Median home price is still pretty low. It’s under 300,000, 273,000. It changes every month, but under 300,000 is good and appreciation has been not great this past year because it already appreciated so much and I think they found their affordability max. But what we plan to do is serve the people who can’t afford to buy. Right? They are maxed out. We are going to do a build to rent community there. We’ve already tied up the land. That’s why I feel okay talking about this because we’ve already tied up the land and on our pro forma it’s showing a 21% IRR to do this build to rent community. So yes, there’s cashflow in something like this. We also work with builders out there who buy down rates and down to the 4% level and it can cashflow with lower rates, but when you build it and you build a community, you can also do really well and it’s small, it’s just 40 homes but still a strong deal.

Dave:

A 21% IRR is nothing to sneeze at. Like Kathy, the most important question is what country borders Texas?

Kathy:

I believe it is Canada. Kidding? I know

Dave:

That’s a hundred percent correct,

Kathy:

But honestly I do know it is Mexico and a lot of the reshoring, again, I interviewed a demographer recently and he explained that a lot of the, I asked him about onshoring or reshoring like bringing manufacturing back to the US and he was like, yeah, but it’s still cheaper in Mexico so it’s easier to onshore or I forget what he called it, nearby shore to manufacture in Mexico and send it over the border in San Antonio is going to be one of those transportation hubs for all those new goods coming into America. So that’s why it’s growing so quickly In addition to the military being there and expanding and Austin nearby is expanding and it’s getting expensive. So more employers and people are moving just a little bit south. It’s only an hour south so lots of potential now the secret’s out.

Dave:

And Kathy, can you tell us why you chose Build to Rent instead of purchasing something that already was built or building some ground up development to sell it off?

Kathy:

We just think the margins are better for build to rent. We ran the numbers build to sell our build to rent and the build to sell was still a good option, but for me, every time we build a subdivision and sell off the properties, I regret it. I always wish we had held it and now I’m really pushing for that whenever it makes sense. I would rather hold those properties for five years instead of giving away all the future growth to someone else. So I mean we have investors in it so there’ll be others benefiting and again, providing affordable housing. If we can build a community of rentals, people could still live in a home. They don’t have to live in an apartment which is preferred. Usually when you have pets and children you can have a yard. So the build to rent model is really, really popular. It’s also a little easier to do build to rent single family homes versus building an apartment. It’s just a little bit cheaper to be able to build that and provide that affordable housing.

Dave:

Alright, James, is this juicy enough for you?

James:

I like the market because A, it’s got high quality living, it’s got some growth, but I almost feel like it’s running out of gas a little bit and it’s kind of flat lining out not as far as rent growth and that it could be a steady investing or place to invest, but I am kind of that appreciation guy, so when I’m looking I want to see what’s still got legs and runway as far as appreciation and I think this is a little bit more standard at that point, so there’s nothing wrong with it. Even Des Moines, Iowa, there’s nothing wrong with it. It depends on what your strategy is. If you want slow and steady and a really good five and 10 year plan, I think Kathy’s market could be a great market to do it and it’s got low unemployment, it’s got higher population growth. The only concern for me in that market is it looks like there’s more owners than renters and so is there that mentee renters coming into the market to rent those, but I think it’s got some legs, but for me I’m picking an appreciation and with the insurance costs rising so much in Texas, cost of living has gone up in Texas. I just think some of the markets are flatlining out a little bit, which is Florida, Texas and California. I would consider it but probably not on my top buy list.

Kathy:

James, I agree with you.

James:

I wouldn’t fly over it.

Kathy:

It’s those pockets though. This little area that we’re focused on is growing so quickly. I agree with you. I don’t want to do a bunch of work for nothing and in our proforma we put in 3% appreciation per year. I think it’s going to be a lot higher than that over the next five years, but slow and steady at this point in my life. I’m good with that. I’m good with slow and steady. I’ve tried to do some doozy deals and ended up being much harder than I thought. So I’m all about conservative, but you’re younger than me. You can just go for it.

Dave:

What about you Henry?

Henry:

I like Texas obviously. I picked a market in Texas as well, which we’ll get to in a minute, but San Antonio was one I was looking at. I’m not a big city investing guy. I like a more suburban off the beaten path kind of. I’m boring man. I just want my appreciation over time. I want to be able to make a little bit of money every month and then before you know it in 20 years you look up and you’ve got all this wealthy accumulated. I’m just boring.

Dave:

Yeah, I get you. I actually maybe two or three years ago was looking for a new market to invest in and narrowed and was really honing in on San Antonio to the point where I flew from Amsterdam to go check it out and wound up not investing there. I just couldn’t figure it out. I don’t know, I’m kind of like Henry, it’s so big and it’s sprawling and I couldn’t figure out the pockets. To your point, Kathy, if you can identify what pocket is going to grow, I personally couldn’t figure out a way to make money there, but I also don’t have the resources or the experience that Kathy does to do a build to rent community, so I didn’t consider that, but just as a buy and hold investor trying to do Burr down there, I couldn’t make the numbers pencil, but I know that there’s a lot of very positive data that suggests that San Antonio is going to keep growing a lot. With that said, let’s move on to our third market. Henry, where in Texas did you pick?

Henry:

I picked Tyler, Texas and here’s why I picked Tyler, Texas. So I’m from a town very similar to a Tyler Texas, so Tyler Texas is about two hours away from a major metro, which would be Dallas. I’m from a town called Bakersfield, which is about an hour and a half away from Los Angeles and there’s great market dynamics where I live in Bakersfield but didn’t want to pick that as my market. I’ve been intrigued with this town for a little while. I have some family that is living in Tyler, Texas and near Tyler, Texas and they talk so highly about it, but why I picked Tyler? Well first of all, let’s talk about the market dynamics. So you’ve got about a 242,000 population size, which is a decent sized town. It’s got population growth consistently, so it’s about 1.8% year over year like normal market dynamics unemployment rate’s 4.3%, which is okay, not great, but not terrible.

The town is doing a lot of investing in the infrastructure in terms of expanding their healthcare facilities and operations because healthcare makes up for two or three of the largest employers of the top five in the area. It is a healthcare market and so they’re growing in that industry and they’re expanding in that industry and they’re investing more money in the area for that industry and you have a median home price of about 263,000. So again, you’re under that $300,000 price point, which makes it fairly affordable for the salaries that people are making in the area. And so I mostly chose Tyler Texas because I have been, well first and foremost in my current investing portfolio, we have tested out midterm rentals as a strategy and it’s working very well. We are able to now make a good amount of cashflow on assets even with interest rates being high and we’re helping our community because we’re providing temporary housing to people who are either coming in and working in the hospital system or coming in and working in the construction industry because they’re building infrastructure in and around the area.

And so the midterm rental strategy has allowed us to increase our cashflow to sustain our portfolio in this high interest rate environment as well as one of the things that I’m looking into in my personal portfolio is I am looking to take single family homes and turn them into residential assisted living facilities. And so that is something that we’re looking to do here in Arkansas. And so I picked Tyler because of the healthcare environment, they have not enough midterm housing for the people who need to come and work at the hospitals and I also just really enjoy single family and small multifamily investing. I’m just not a large scale multifamily guy. It doesn’t excite me. I don’t really like it. And so this market would allow me to be able to purchase single family homes and then use those single family homes to either provide midterm housing to the healthcare providers in the area or it would be able to use it to turn single family homes into residential assisted living facilities and provide quality care to the aging community. We all know about the silver tsunami and about how baby boomers are aging out and they’re going to need this type of care soon. The problem is we don’t have nearly enough beds for the aging community and so you’ve got more elderly folks being cared for by less people and so that we just kind of have a passion for that because of my personal family situation. And so a market like this has good dynamics for both of those strategies.

Kathy:

Oh my gosh, Henry, that is so good. So good. It’s so needed. The silver tsunami that they talk about where there’ll be a bunch of houses on the market. I don’t know about that so much, but I mean there will be, but I don’t know that it’s going to, it’ll just help. We need the inventory.

Dave:

Yeah, I’m with you on that.

Kathy:

But what people aren’t talking about is the need is the for care as the oldest of the baby boomers are 80 and you are on it. That’s incredible.

Dave:

What does the cash flow look like in this market? Is it reasonable to think you could find a deal that cash flows without a super heavy rehab

Henry:

From a long-term rental perspective? So I think just buying something on the market and getting it to cashflow is probably going to be a bit of a challenge. It’ll take you a while to be able to find that. I don’t think you could like in Des Moines where you just buy something in your cashflow and instantly not going to be the case with a $265,000 price point. I don’t think that your long-term rents are going to be able to cover it, but if you could do a midterm strategy, definitely buying something on the market, but I think you can absolutely find things off market that are going to get you to cashflow. Cool. So it definitely there.

Dave:

All right. Good to know. I would ask James, but I already know it’s not juicy.

James:

Well, there’s definitely some things I like about this market. The quality living is really good, but I also like that Henry selected a market. I think it’s important for all investors to do is what is the strategy that’s working for you right now? I think there’s so much noise where people rush to these markets because they go, oh, everyone’s investing there. Well what’s the strategy that you’re doing and all the markets that we’re looking at, depending on what you want to do as an investor, that’s why we’re selecting these and it’s a strategy that work. Dave’s is going to be different than Kathy’s is going to be different than Henry’s and from what Henry just went over, there’s a high demand for midterm rentals because of the healthcare industry and if that’s what’s working for him in his portfolio, it makes all the sense in the world for him to invest there. It’s got high quality living, there’s population growth, low unemployment and the demographic he’s trying to create revenue and income with are needed in that space. And it’s not just about the markets, it’s about pairing the right strategy with the market. That’s where you can absolutely crush it.

If I was a midterm rental guy, I would definitely be like, oh, that’s an interesting market to look in. I’m more long-term or just more stabilized rents and so it might not work for me for what I do, but it’s got all the math that you would want and all the growth that you’d want if that’s your strategy.

Henry:

Yeah, exactly. James. My thought process here was where could I buy property and hold it for the long term, make it make money while I’m holding it for the long term and then get the appreciation year over year. So I’m not a big multifamily guy, so I don’t want to find multifamily in markets. I’m like, where can I find single family, rent it out, make money month over month, but then look up in 20 to 30 years have paid off assets in markets that are appreciating. If you look at the appreciation in Tyler, Texas over the past couple of years, it’s been around anywhere between three and 4%. So it’s sitting at like 4.2% right now. That’s pretty solid. And so if you’re just going to average your steady growth one to 4% year over year, and I know I have demand in the healthcare industry, then I can sit here and I can make money month over month and then grow my steady appreciation year over year, look up in 20 to 30 years and have paid off assets.

Plus I get to serve a need by providing housing to the healthcare providers and providing housing to the aging population. If you look at the stats on what we’re going to need in terms of beds for assisted living facilities by 2025, we will need approximately 156,000 new assisted living facilities nationwide. And if you consider Texas as one of the largest states, they’re going to make up a good chunk of that. So we need, and those are across the country, so if I’m able to meet some of that demand, help people and then make money year over year in a good steady market. I mean, like I said, nice boring real estate man. I’m in

Dave:

Henry, you got one we all agreed on. All right. Henry’s winning. We have to admit

James:

People love roses. It’s the rose capital of the, it’s the rose stop call. The roses is your kind of unwinding down so it’s got the right attraction.

Kathy:

Yeah, I can’t wait to hear all about how you pull this off because I think you’re going to have a lot of people wanting to replicate what you’re about to do. It’s really exciting and so needed. I

Henry:

Hope so. We’re super excited about it.

Dave:

Okay, we have to take one more quick break, but stick around for the secrets of James’s underrated market and which market we ground the winner right after this. Hey investors, welcome back to the show. Awesome. Well let’s move on to our last market, which is let’s see how juicy James gets with his deal. James, what market did you pick?

James:

You know what, I have been zipping Henry’s secret sauce and I’m in Arkansas. I picked Arkansas. I’ve got to know Arkansas a lot better just because of Henry. And I picked high fill Arkansas, which is a very small area population whopping twenty two hundred and sixty eight people. And so I went for a very small under the radar market. Wait,

Henry:

Wait, wait.

Dave:

He’s trying to steal your sh*t. Henry, you

Henry:

Hold on a second. James, did you give Dave crap about a flyover state and not a juicy market and then pick a town with 2,500 people as a population

Kathy:

2,222.

Dave:

That’s a very good point. Thank you Henry for defending my honor. I appreciate that.

James:

I think this is a goldmine town. You’re going

Kathy:

To have a lot of buyers, a lot of renters.

Dave:

I feel like I know James’s strategy. James is literally going to buy every house in the town. He’s just going to go in there and he is just going to be like, you know what?

Henry:

He’s going to be the mayor.

Dave:

I’ll take ’em all. Give me every house,

James:

Be the new hedge fund of the market. All

Dave:

Right, tell us why you like, hi Phil. Yeah,

James:

Okay, so why I like high HiFi and now granted the stats are always going to be skewed when you’re dealing with this small of a population, 2,268 people. Not a whole lot of people, but this is why I like it. Okay, the population growth trends at 16.7%, which again, it doesn’t take much to move that up, but people are moving there. 16.7% unemployment rates at 3.4, which is almost nearly half the amount of the national average rent growth is a tough thing to find in a city this small,

Dave:

Right? No, it’s not. The unemployment rate is not 6.8% in the United States.

James:

I’m sorry, isn’t it 6.2 that I read last night?

Dave:

No, it’s 4.1%.

Kathy:

We would have a lot of

Dave:

Rate cuts. James is disqualified. Disqualified

James:

Was

Dave:

Green last night. No, it’s 4.1% I’m sure about that.

James:

4.1. Okay, well yeah,

Kathy:

That’s a pretty big

James:

Jump. Yes. Okay. Well it’s still below. We’re about 20, 25% below the national average.

Dave:

This is why James wants to buy the whole town. He’s going to go in there and he is going to tell people we have the lowest unemployment rate in history. We have the best economy in the world. Everyone’s just going to have to believe him. He owns everything.

James:

That is true. Yeah, I don’t know what I was reading last night. Yeah, when I was looking in, I saw it in the sixes, but this is why I like Arkansas and I’ve kind of gotten on a little bit of an Arkansas buzz because Henry likes to remind me that the big businesses are expanding there and Walmart is expanding a massive campus, 300 acres. And one thing that I have felt the benefit from is being in Seattle, Microsoft has expanded, Amazon has expanded. These big business expansions can lead to big jolts in your market. And the reason I like high fill is it’s a pretty close to the campus. It’s right outside Bentonville. It’s more affordable than vent and fill. And there is population growth 16.7, yes, that’s not that many people coming in, but the thing that I do like is the appreciation was 21.1 year over year.

The median house price is on the higher side over everyone else’s market, 380,000. Now I know that’s more expensive than what everyone’s talking about, but the reason I like this as a strategy is I like a little bit more expensive markets because when you have appreciation on the more expensive markets, you get more impact. And what I mean by that is if I have a house that’s appreciating at nearly 10% or 20%, it’s 380 grand. That’s 38,000 that I can get impact on in one single year. And the demographics for this, and this is why I really liked this, and now I’m actually really considering investing in this area. I like the Walmart growth, but then the dual income for this area is almost a hundred thousand dollars is 97,500 for dual working families at maybe a home prize of 380. There’s a lot of growth there.

The expenses are 30% below the national average. And I did check that one again, I might be off on the unemployment, but it’s below the natural average and it has this quaint feel to it. And so it’s where a lot of working professionals can go. They can live there, raise their kids in a very nice neighborhood. They have more disposable income than average because they’re making good money. They’re making nearly a hundred thousand dollars a year. It’s very affordable and it’s great for commuting, especially if they got to fly around the country because it’s close to the airport, but it’s a good quality of living. And this is what I think is gas for a market when it’s affordable, high quality living and big business expansion, that’s how you can hit those huge appreciation pops over a two to three year period. And that’s why I like this market.

People have money, it’s a good place to live. And I think it hasn’t ran out of runway. We’re seeing a lot of markets flat line and I think this one can keep going up. And the rents also, it’s hard to find when you’re looking in a small town, but I think at Arkansas there are over 16.5% rent growth for the year. And so there’s just legs on this and when you have legs you get big appreciation pops. And so for me, I’d be looking at flipping and then burr properties that I could keep and trade out later and just stack some equity, get some growth, and start buying units wherever I want to do. So I like the runway on this.

Kathy:

Oh, I can’t wait to hear what Henry has to say. Jump in. Henry,

Dave:

I’m not even going to say anything. Henry, you just take this

James:

One. I feel like I just told Henry he looks very pretty. He’s glowing.

Henry:

Well James, you are 100000% right? So let me add some color to what you’ve put together here. Absolutely right. So this market, yes, very teeny tiny town, but from a logistical perspective, it is very close to Bentonville. And what we know about Bentonville is it is a small town that houses a lot of people because of Walmart. It’s the largest company in the US and they just made an announcement recently. I don’t know if you guys know this, Walmart just made an announcement recently. Everybody that is working remote from Walmart has to now return to Bentonville. There’s a couple other cities in the US that they can go to, but they must come back. And so you’ve got this influx of people right now who are moving back to the area so that they can keep their job working for Walmart, which means you’ve got more people coming to a very small town in Bentonville, which means it is forcing people to move out and out and out.

So there are new housing developments going up and they’re pushing further and further out and it won’t be very long before he fill. Feels like it’s right here in Bentonville because of the growth and the expansion in the area. 35 people a day moving to Northwest Arkansas. So you’ve got people that are moving here, you’ve got this town that’s very close. What’s also they don’t know is you said it’s close to the airport. That is an understatement. It is like a couple of miles from the international airport. That’s huge because if you are working for Walmart, a lot of the jobs require you to travel. You want to live in a place like Ville because you don’t have to deal with the traffic and the problems of Bentonville. You get to get a house on some land, on some acreage, and you get to be with just a minute or twos Driving to the airport heel is going to be a very desirable place for people who want to live because you don’t have to get your cookie cutter house in a subdivision. You can go get a barn, you can go get a house on five, 10 acres. And the dynamics in heel are great, man. I think you’re onto something, James. Woohoo.

You nailed it.

Dave:

I love how nice you’re being Tim Henry, when you could have just been like, stop stealing my sh*t, man.

Henry:

No man. I’d see opportunities, man. This is opportunities, this is partnerships,

Dave:

The opportunities. You should go buy all the deals and then sell ’em to James.

Henry:

Let’s go figure out a small town around here, James. We’ll just go buy the town.

James:

I’m going to become the mayor.

Dave:

Alright, our last question for you guys before we get out of here. Each one of you tell me what market you would pick, not your own James, so you can’t pick, what was it called, the fel. What market would you pick if you had to pick one or the other one? I know you’re not going with Des Moines so you can feel free to insult me, but between Henry and Kathy.

James:

You know what I think I’m going with Kathy. I like being closer to Metro City. It’s close to San Antonio. A lot of people want to move to San Antonio because the quality of life right now. I know a lot of people in Texas are transitioning from other cities into San Antonio. And so I like the big city poll. So I’m going with Kathy’s

Dave:

Henry.

Henry:

I mean obviously I would pick Fel. I own property in the town right next to Fel already.

Dave:

Okay, that’s cheating fine. Kathy, what about you?

Kathy:

Okay, definitely. Hi Phil. I am sold. At first I thought James was crazy and then I looked up where it is and it’s just 25 minutes away from Bentonville. And I think Fayetteville too, not too far. So it’s not as far in the boonies and all the reasons you just said. I think we just need to make a trip out there to Arkansas. I heard it’s just got a lot of, I don’t know, rivers, lakes, and crystals. It

Dave:

Doesn’t. I’m ready whenever you are, but I’m picking Tyler. I’m going with you Henry. I thought we all agreed that was the one we liked. I think that’s a lot of interesting dynamics there. I’m into it. Alright, well I guess I’ll just be here by myself pushing the Midwest as usual. We’ll see where we end up 20 years from now. Alright, well thank you all so much for listening. Hopefully you’ll learn something. If you do want to find out more information about market you’re considering, make sure to go to biggerpockets.com/find a market. You can learn all the stats, information, the stuff we were citing here for pretty much any market in the US

Henry:

And make sure you subscribe to the show. So when we do our 20 year reunion special and we give you an update on these, we’ll know who’s winning.

Dave:

Yes, yes. We’re going to do our 2045 special about what market did the best. They’re all going to be holograms and it’s just going to be like AI speaking for us. There’s not going to be a job of podcaster in 20 years, but we’ll see. I’ll be

Kathy:

Living in one of Henry’s homes. That’s all I can say.

Dave:

Kathy will be living in Tyler, Texas. Hopefully. I will too. I would love to.

Henry:

I got you. I got you. All

Kathy:

Right. Excellent. Thank you.

Dave:

All right, well thank you all for being here. If you want to connect with any of these fine investors, we’ll put their contact information below. Thanks for listening. We’ll see you next time for On The Market. Bye-Bye. On The Market was created by me, Dave Meyer and Kaylin Bennett. The show is produced by Kaylin Bennett, with editing by Exodus Media. Copywriting is by Calico content, and we want to extend a big thank you to everyone at BiggerPockets for making this show possible.