A few people have asked about how I found value when I began my portfolio and whether or not I see value today.  You risk a lot by entering the market now, but you can glean a lot of success from tapping medium to small cities in areas that missed out on the housing run-up of the past 7 years.

My prime case is Syracuse, NY.  Because of horrendous crime issues (for a city of its size), the city proper saw somewhat of a housing depression not too long ago.  While others were booming, this rust belt locale continued to lose jobs and tried grasping at straws like Bob Congel’s Destiny USA project.  Prices for sizeable homes in poor neighborhoods were in the mid $30s.  You can still buy a 3-4 bedroom house in the city for $40-$50,000 in some neighborhoods.

Are we betting on the city here?  Not really - we don’t need to.  The fact is that even in areas like Syracuse, NY the real estate cycle and boom comes calling.  It may not “boom”, but the upward wave in prices that places like DC, Las Vegas, Pheonix, and San Diego saw, but it is a severely undervalued market that just may return more this year for real estate investors than any other city in the Northeast.

There are other targets like this out there.  If you can be precise and wise you can find them, but be wary — finding a reasonable mortgage at this stage in the game is a very speculative bet.  Hedge yourself wisely.