Why Your Small Town Is (Probably) the Best Place to Buy Rentals

5 snips

Sep 16, 2024

Josh Bauerle, a real estate investor who built a portfolio of over twenty rental properties in a small Ohio town, shares his unique approach to investing. He emphasizes that small towns can be golden opportunities for real estate, revealing how he successfully used seller financing and Section 8 rentals to grow his income. Josh discusses the importance of community connections and effective property management while debunking myths around Section 8 housing. His journey from setbacks to a thriving investment career offers inspiring insights for both new and seasoned investors.

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ANECDOTE

13-Year Flip

Josh's first flip in 2006, intended to be quick, turned into a 13-year ordeal due to the market crash.
He bought it with a loan, despite being a student with no income, highlighting the risky lending practices of the time.

ANECDOTE

Return to Real Estate

Josh re-entered real estate in 2017 by buying a $30,000 rental property from his father.
It cash flowed well initially, but a recurring sewer line issue highlighted the risks of owning just one property.

INSIGHT

Get Big or Get Out

Experiencing a costly sewer issue on a single property pushed Josh to scale his portfolio.
He realized that multiple properties provide a safety net against unexpected expenses affecting cash flow.

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Your small town might be the best place to invest in real estate, even if it’s got only a few thousand residents. We know—everyone has told you to go to the bigger, growing cities where you can chase appreciation, but today’s guest might change your mind. He was able to scale to over twenty rental properties in just a few years, all by buying in his rural Ohio town that you’ve probably never heard of. Even better? He bought the rentals with none of his own money, AND he was cash-flowing THOUSANDS per month. So how do you do it, too?

Josh Bauerle tried to invest in real estate back in 2006. What was supposed to be a “quick flip” turned into a thirteen-year investment, which (thankfully) made a bit of money by the end. After taking a decade off from real estate investing, he got back in the game, first by buying a rental from his father and then by purchasing a twelve-unit real estate portfolio from a local friend. He then scaled FAST to a serious amount of rentals, all in a tiny town with a small population.

After that, he stumbled upon the best-kept cash flow secret in real estate investing: section 8 rentals. Today, Josh is sharing how he did it without using his own money, and how you can do it, too, whether you’re in a sizable city or a small town.

In This Episode We Cover:

Why living in a small town is a HUGE advantage for real estate investing

Seller financing 101 and how to buy rental properties without getting a traditional loan

Using other people’s money to build a rental property portfolio

Section 8 rentals, the pros and cons, and why they get you MORE rent than regular rentals

The simple way that Josh has found his off-market real estate deals with social media

And So Much More!

Links from the Show

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See Dave at BPCON2024 in Cancun!

The Pros and Cons of Accepting Section 8 Housing

Connect with Josh

Connect with Dave

(00:00) Intro

(01:27) A Failed "Quick Flip"

(05:47) Taking a 10-Year Investing Break

(09:17) Buying 13 Units at Once

(15:13) Quitting His Job/Business

(18:26) Using Other People's Money

(20:11) Moving to a Bigger Market

(23:53) Making More with Section 8

(30:10) Scaling Fast!

Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/real-estate-1018

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