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Chirag Shetty
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Out of state market for first time investor

Chirag Shetty
Posted Nov 27 2021, 15:09

Hello BP community,

I hope everyone had a great Thanksgiving! I am a newbie investor looking to make to my first OOS real estate investment. 

I wanted to get insights from this community on the best markets to invest out of state. I am primarily based in Seattle and I am looking to diversify by investing outside of my resident state. I want to build a balanced portfolio of appreciating and cash flow properties and I would like to start off with an appreciation property as my immediate focus is to build long-term wealth and also because most markets I am interested in seem to have properties in the $200k-$350k range which falls within the range for my budget (I have ~60k-70k to invest). Being a newbie investor, I do not have much insight into flipping homes or rehabbing a property and thereby looking into markets where I can get a recently build (max 5 years old)/new property that does not require additional work to rent out. As an alternative I have been looking into turnkey properties too but again I am unsure which market is the ideal place to start. Ideally, I would want the property to be cash flow positive just enough to cover all the expenses (mortgage, taxes, property mgmt) with a buffer in case the market cools down in the coming years. Given how crazy the market's been recently i do not think the craze will sustain over a long period and if the market cools down in some areas it makes sense to invest in a property that retains its rental value.

Based on initial research, it seems like Charlotte fits the criteria as it has seen decent population growth and appreciation in the recent years and is my first choice but I haven't had any luck finding properties that checks the boxes. Additionally, I am not seeing the same enthusiasm in this forum (or maybe i have missed the posts) towards Charlotte and I have also read enough posts about how the inventory is bought up by the big funds and there is little to no options to invest within and around Charlotte that meets the criteria i shared above. I would be glad to be proven wrong if anyone else thinks otherwise. I have seen a lot of chatter around the Midwest markets such as Kansas City, Columbus, Indianapolis but most people who have acquired property seem to boast about its cash flow strength rather than appreciation. I am also conscious of the impact of climate change on our country's demographic and therefore do not feel confident about investing in Florida as I have read some urban planning research papers that predict in the long-term, half the state will be underwater along with Louisiana (20 years out). I don't think that leaves with me a lot of options so any guidance here would be really helpful!

I have made a lot of assumptions here and I might as well be completely wrong about all of them. Looking forward to get some feedback/guidance from the experts here to boost/re-orient my thought process and also hoping to network with individuals who can help me with my investment goals! Thanks in advance!

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