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How to Find the Right Property Manager for Your Out-of-State Rental

Steve Rozenberg
4 min read
How to Find the Right Property Manager for Your Out-of-State Rental

Imagine receiving a $20,000 check to purchase a rental property. How about step-by-step guidance from some of the most experienced real estate investors in the industry? Well, that’s exactly what the Dream Investment Adventure Series is all about.

Dream Investor Adventure

Follow along with our contest winner, Joe, and his journey of purchasing an out-of-state rental property. Through the mentorship of Steve Rozenberg, Head of Investor Education for Mynd Property Management, they learn about investing. Throughout the next two months, the pair will research markets, build a team, purchase a property, complete a renovation, lease the property, and everything in between without Joe ever seeing the property in-person.

Previously, we discussed investing goals and strategy. Then, we helped Joe choose a rental market.

This week, in episode 3, we will learn about the team Joe assembled in Atlanta. Joe is finding his Realtor and property management company. He also goes through the process to narrow down where to look and the next steps to take on this out-of-state investment journey.

Dream Investment Adventure Series – Episode 3

How to Find a Property Manager for Your Long-Distance Rental Property

After searching through the BiggerPockets Forums to find people actively sharing their knowledge about the Atlanta area, Joe noticed a few that stood out as the experts. So he contacted them, and ended up Joe developing a strong rapport with Nick Fitzpatrick. Nick is a Realtor in Georgia, who is also an investor and has experience working with out-of-state clients. Having done a BRRRR deal himself, Nick was the logical choice, as he understands what Joe is looking to accomplish with his investment property.

With the guidance of Nick and Jessy Porter, a rental property manager from Mynd, Joe used their expertise to identify neighborhoods that fit his strategy and goals. With his local team solidly in place, below Joe shares how they determined where to look for investment opportunities.

How to Choose the Right Area to Invest Out of State

Using the expertise of your team is key

Initially, Joe and Nick were looking at some rental properties in the city center, which had good appreciation numbers. However, they couldn’t make the cash flow numbers work. Jessy suggested staying clear of that central city area for rentals. This exemplifies the importance of having a local team’s feedback. Their knowledge and experience are valuable assets when long-distance investing remotely.

Related: Looking to Invest Out of State? Here’s How to Pick and Analyze a City

With city-center properties off the table, it was time to find neighborhoods in the suburbs that would be within the budget. They also looked for good performance on appreciation and those offering good cash flow. Joe asked both his property management company and Nick for their suggestions and looked for the overlaps.

The whole team agreed on the Douglasville/Lithia Springs area that offers an easy commute into Atlanta, good appreciation, and cash flow. It is important to find third party, unbiased parties. They will help you take the emotion out of your deal and use data and numbers to support your strategy.

You don’t need to be the expert—hire the expert

Joe has put together a strong team in Atlanta. Nick offers familiarity with the BRRRR process, knowledge of the real estate market, and local contractor contacts. Mynd’s property management experience lends their expertise with the local rental market, renovations, and getting property rent ready.

Joe didn’t have to explain the BRRRR process either. Each of the experts was already familiar with it. They have a thorough understanding of what Joe is trying to accomplish with this deal and the knowledge to get him there.

This is a great example of local experts having a well-rounded understanding of the investor’s strategy. Furthermore, they understand Joe’s goals, as well as what makes the market different and unique. With this team of a Realtor and property management in place, Joe was able to gather the information he needed to make a decision. Because of the team, he knows where he wants to purchase his out-of-state rental property!

Related: The Core 4 Members Vital to a Profitable Long-Distance Real Estate Investing Team

Develop a list of potential properties for purchase

Over the next week, Nick will be sending Joe several properties that meet his criteria. Mynd Property Management will run a rental analysis on each to determine what the properties could rent for. It is important to look into very specific neighborhoods, with very similar property types (similar number of beds and baths) and pull comps to get accurate rental numbers.

Joe will then plug these numbers into the BiggerPockets Calculator to determine the cash flow projection.

Related: Rental Property Numbers So Easy You Can Calculate Them on a Napkin (With Real-Life Example!)

map with red location markers

Create criteria and stay within it

Steve suggests Joe set up some parameters to make it easier to give a clear “yes” or “no” to the properties. These criteria may include:

  • What ROI are you willing to accept?
  • What amount of cash flow must you have?
  • How much are you willing to put in for make-ready/rehab?
  • What type of gain are you looking for in the ARV (after repair value)?

All criteria should be stated as percentages. Create a spreadsheet that will calculate these numbers and reveal a clear “yes” or “no,” and you will avoid the “maybes” that can get you in trouble.

Time to find some deals

Joe will leverage his entire team to compile a list of potential properties that fit his criteria. While Nick is busy looking for houses through his resources, Joe can also check out the BiggerPockets Marketplace for possible investment deals to send to Nick.

It is important to include Mynd’s feedback in the selection process, as well. This is because they will be the ones managing the home after the purchase. Joe will utilize their experience in the Atlanta market to make a smart investment decision.

Related: How to Hire Amazing Team Members for Every Real Estate Process—From Finding Deals to Renting Them Out

This whole process really highlights the importance of choosing a local team—especially, if you are a long-distance real estate investor looking at out-of-state rental properties. Finding a real estate agent and property management company is just the beginning. You may also want to consider finding a local lender, contractor, joining a virtual online community, and getting to know other investors in the area.

Homework Week #3

Joe will return next week with a few deals that are ready for final analysis. Joe and Steve will aim to select a property to make an offer on. We will learn about using the BiggerPockets Calculator and exactly how to analyze a deal on a remote investment property.

To learn more about Joe’s investing journey, gain access to investor tools and resources, and inform your own remote investment journey, check out the exclusive destination page for BiggerPocket fans only! There, you’ll also find a limited-time BiggerPockets exclusive offer for property management.

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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.