BiggerPockets Real Estate Podcast Episode: The Easiest Way to Find Profitable Rental Properties
Host: Dave Meyer
Release Date: May 14, 2025

Introduction

In this enlightening episode of the BiggerPockets Real Estate Podcast, host Dave Meyer delves into the most straightforward methods for identifying profitable rental properties in 2025. Aimed at both novice and seasoned investors, Meyer shares his 15 years of experience to guide listeners toward achieving financial freedom through strategic real estate investments.

Understanding Where to Find Deals

Meyer begins by categorizing investment properties into two main types: On-Market and Off-Market deals.

• On-Market Deals: These are properties listed publicly on platforms like MLS, Realtor.com, Redfin, and Zillow. Meyer emphasizes, “[...] on-market is like the 80-20 of this. This is where you get the most bang for your buck” (02:30).

• Off-Market Deals: These include foreclosures, auctions, pocket listings, and direct-to-seller marketing. While valuable, Meyer chooses to focus primarily on on-market deals for their accessibility and volume.

Adopting a Volume-Based Screening Approach

Central to Meyer's strategy is the funnel approach, which involves:

1. High Volume Screening: Start by evaluating a large number of properties (e.g., 100) to identify potential deals.
2. Initial Screening: Narrow down to about 20 properties that pass the preliminary criteria.
3. Deep Dive Analysis: Conduct thorough underwriting on these 20 to shortlist 5 promising candidates.
4. Final Evaluation: Visit or have a trusted team assess these 5 properties, ultimately making offers on 1 or 2 deals.

Meyer articulates the importance of this method: “You need to look at a lot of properties before you actually find a deal. [...] It could take you 20 properties. It could take you 50 properties” (04:00).

Leveraging BiggerPockets' New Property Screening Tool

Highlighting innovation, Meyer introduces BiggerPockets' new free screening tool designed to streamline the property evaluation process. This tool provides crucial metrics such as:

• Cash Flow Estimates
• Cap Rate
• Internal Rate of Return (IRR)
• Rent Estimates

He states, “This is what BiggerPockets is going to show you is what the cash flow is estimated to be, what the cap rate is estimated to be...” (06:00). The tool significantly reduces the time required for initial screenings, transforming what used to take hours into mere minutes.

Practical Example: Analyzing a Property in Indianapolis

To illustrate the tool's efficacy, Meyer walks through a live example using a property in Indianapolis:

• Property Details: 3 beds, 3 baths, recently renovated, listed at $285,000.
• Estimated Rent: $2,500/month approaching the 1% rule.
• Cash Flow: After factoring in expenses, projects $265/month with a 5% cash on cash return.

He remarks, “This would have taken hours and hours and hours of all the properties listing on Zillow to find one that cash flows. 5% would literally have taken me tens dozen hours at least” (10:00).

Meyer also adjusts assumptions to reflect real-world scenarios, such as increasing the down payment to 25% for out-of-state investments, which enhances the cash flow to $350/month and the cash on cash return to 5.1% (13:30).

Detailed Underwriting and Assumptions

Transitioning from screening to underwriting, Meyer emphasizes the necessity of accurate assumptions:

1. Accurate Rent Estimates: Utilize tools like BiggerPockets' rent estimator and consult with local property managers or renters.

2. Expenses Calculation: Include fixed costs (taxes, insurance) and variable costs (repairs, maintenance, vacancy rates).

3. Professional Insights: Engage with other investors through BiggerPockets forums or local meetups to gauge realistic expense reserves.

Meyer advises, “If you're doing 20 of these calculator reports to really do the underwriting, maybe five of them are going to get to this next stage” (22:00).

Investment Strategy Insights

Meyer shares his investment philosophy:

• Break-Even Cash Flow: Aim for at least break-even in the first year, factoring in all potential costs.

• Future Upside: Consider properties in growth areas or with value-add potential, even if initial cash flow is modest (e.g., 1-2%) because of anticipated appreciation.

• Risk and Return Balance: Higher cash on cash returns (6-10%) are expected in markets with limited upside or higher risk.

He summarizes, “Here's the process that I've literally been using for 15 years as a real estate investor. And I think it's something that absolutely anyone can learn” (28:30).

Conclusion: Mindset and Next Steps

Meyer wraps up by reinforcing the funnel mindset:

1. Start Broad: Cast a wide net by evaluating numerous properties.
2. Filter Down: Use strategic criteria to narrow down to the most promising deals.
3. Thoroughly Analyze: Conduct detailed underwriting to ensure profitability.
4. Finalize Decisions: Visit properties and make informed offers confidently.

He encourages persistence and patience, assuring listeners that with practice, the process becomes more efficient: “Eventually it's not going to take you five hours. I promise. Looking through 20 deals, sooner or later it's going to take you two hours and then this whole process is just going to get easier” (32:15).

Key Takeaways

• Volume Screening: A high-volume approach increases the likelihood of finding profitable deals.
• Efficient Tools: Utilize BiggerPockets' screening tools to save time and improve accuracy.
• Accurate Underwriting: Detailed analysis with realistic assumptions is crucial for investment success.
• Strategic Mindset: Adopt a funnel approach to systematically narrow down the best investment opportunities.

Notable Quotes

• “This is the easiest way to find a rental property that will make you money in 2025.” – Dave Meyer (00:00)
• “You are going to have to start with a broad approach looking at a lot of properties...” – Dave Meyer (04:00)
• “This is what BiggerPockets is going to show you is what the cash flow is estimated to be...” – Dave Meyer (06:00)
• “I am confident you'll start to get a sense of what a good deal is in your market.” – Dave Meyer (32:00)

By following Dave Meyer's structured approach and leveraging the advanced tools provided by BiggerPockets, real estate investors can efficiently identify and secure profitable rental properties, paving the way toward financial independence.