Motivated for out of state purchase

Homeowner · Orange County, CA · Member since 2017 · 15 posts · 9 votes

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

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Rob Nappi

Investor · Santa Rosa, CA · Member since 2018 · 59 posts · 18 votes

Hey there,

I’m located in Northern Cali. I have been involved IN Indy since 2018. I currently have a team out there.
I’m currently building a website to share information about how I invest in INDY.

We have what we call “The Program.”
This all depends on what your goals are.

If you are looking for cash flow then keep my information and I will give you a link to my site that will explain everything.

quick version:

We buy most likely something that needs work. We use a property management company that beats anyone on price for repairs or renovations. We use government contract programs to place tenants. 2 year leases guaranteed money. Rates vary but are at or above current market rates.
Property management is part of the deal. You cannot use the program to place tenants and use a different company. They do a great job. Plus have access to a lot of off market deals from other investors that use this property management company.
I run the numbers on 8%-10% mortgage rates and still cash flow nicely. Sounds insane but it’s true. Just reach out if you’re interested for more info. I will have the site complete by next week.

Good luck,

Rob

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Cullen W Jones
Real Estate Agent · Indianapolis, IN · Member since 2019 · 42 posts · 24 votes
4y
Hi Kevin, I'm a broker located in Indianapolis. I would be happy to inform you on the neighborhoods around here and the hot areas to invest in.
1 Reply
Rob Nappi
Investor · Santa Rosa, CA · Member since 2018 · 59 posts · 18 votes
4y
Hey there,
I’m located in Northern Cali. I have been involved IN Indy since 2018. I currently have a team out there.
I’m currently building a website to share information about how I invest in INDY.
We have what we call “The Program.”
This all depends on what your goals are.
If you are looking for cash flow then keep my information and I will give you a link to my site that will explain everything.
quick version:
We buy most likely something that needs work. We use a property management company that beats anyone on price for repairs or renovations. We use government contract programs to place tenants. 2 year leases guaranteed money. Rates vary but are at or above current market rates.
Property management is part of the deal. You cannot use the program to place tenants and use a different company. They do a great job. Plus have access to a lot of off market deals from other investors that use this property management company.
I run the numbers on 8%-10% mortgage rates and still cash flow nicely. Sounds insane but it’s true. Just reach out if you’re interested for more info. I will have the site complete by next week.
Good luck,
Rob
2 Reply
Eliott Elias
Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
4y
Killeen Texas is a great market for cash flow and flips
0 Reply
Shane Kelly
Real Estate Agent · Cleveland, OH · Member since 2021 · 383 posts · 361 votes
4y
Congrats! I'm sure Cleveland can't steer you wrong, but your goals matter just as much as the market you're looking into. Cleveland does bring the lower entry price, but it's a competitive market and doesn't appreciate much. Every market has it's draws and I'm sure you know that, so set your goals and strategies in place and then search for one that compliments what you're looking for. Best of luck!
0 Reply
Nicholas Coulter
Real Estate Agent · Southern California · Member since 2019 · 681 posts · 281 votes
4y
@Kevin Bonner I am going to be setting up a meet up at the end of this month and I will send you the details. You may find some like minded people there who are already doing the same thing!
1 Reply
Kevin Bonner
OP
Homeowner · Orange County, CA · Member since 2017 · 15 posts · 9 votes
4y
Quote from @Nicholas Coulter:

@Kevin Bonner I am going to be setting up a meet up at the end of this month and I will send you the details. You may find some like minded people there who are already doing the same thing!
That would be perfect, definitely would be interested in a meet up. Thanks!!
0 Reply
Ruchit Patel
Bay area, CA · Member since 2021 · 383 posts · 306 votes
4y
I am from California and have been investing out of state for the last 18 months. You can message me and we can connect if you want to know my story/experience.
In general, it will be down to making tons of phone calls and finding good people you can trust.
2 Reply
Aj Parikh
Rental Property Investor · Centreville, VA · Member since 2019 · 1k+ posts · 799 votes
4y
Hi Kevin, I am an out of state investor based in Northern Virginia and invest primarily in multi family and SFH in Cleveland. Feel free to connect and we can chat about investing out of state.
0 Reply
James Wise
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
4y
Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Kevin I suggest giving The Ultimate Guide to Grading Cleveland a read. Cleveland is a tricky market. You can make a lot of money but also get upside down real just as quickly.
1 Reply
Alex Evans
Memphis, TN · Member since 2022 · 230 posts · 99 votes
4y
Hello @Kevin Bonner
If you are looking to go with a Turnkey property here in Memphis I would be more than happy to help answer any questions about the city!
Memphis is a great market to invest in
- decent cashflow
- stable appreciation
- over 50% of the population in Memphis are renters
- Low supply will lead to increasing prices until we are able to build new developments again
Please feel free to reach out at any point!
0 Reply
Tyler LingleBusiness Member
Real Estate Consultant · Indianapolis, IN · Member since 2021 · 440 posts · 292 votes
4y
Hey @Kevin Bonner, it's great you are considering different cities to invest in. I work in Indianapolis and here's some things I'm seeing: we are growing steadily at around 2% / year and we have one of the lowest unemployment rates in the Midwest at 2.5%. I would love to talk more with you about investing!
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1 Reply
Steven Foster Wilson
Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
4y
Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Hi Kevin,
I help people find killer deal all the time in Cleveland Ohio. It is a great market. I actually just bought 8 units a few weeks ago from there. I would be happy to answer any questions you have.
1 Reply
Kevin Bonner
OP
Homeowner · Orange County, CA · Member since 2017 · 15 posts · 9 votes
4y
Quote from @James Wise:

Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Kevin I suggest giving The Ultimate Guide to Grading Cleveland a read. Cleveland is a tricky market. You can make a lot of money but also get upside down real just as quickly.
Wow! That’s incredible. Enjoying looking into it now.
0 Reply
Mike D'ArrigoPro Member
Turn key provider · San Jose, CA · Member since 2010 · 4k+ posts · 3k+ votes
4y
@Kevin Bonner the 3 markets that you mention are all good cash flow markets but you should also be considering more than just cash flow. No one gets wealthy from just cash flow. Most wealth over time will come from equity through maortgage paydown and appreication. Markets with growing populations, growing jobs, good incomes and modern/diverse economies will have the most potential for appreciation and also rental increases. Buying the right asset class in important too. Don't assume that lower prices mean less risk. It's actually the opposite. The lower the asset class, the higher the risk. I'm not suggesting that you have to buy an A class property, but you don't want to buy cheap properties in high crime areas. Personally, I recommend sticking to B and upper C class working class neighborhoods.
1 Reply
Jon Q.
Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
4y
How much capital do you have to invest?
What specifically are your investment goals?
Before you decide a market, strategy or anything, decide on your investment goal.
EVERY activity you do as an investor should further your specific investment. Otherwise, you are wasting your time, chasing your tale, trying to copy others who have different skills and goals than you do.
0 Reply
Jon Q.
Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
4y
Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Those markets are higher cash flow, but LOW equity growth markets and you'll generally attract a low tenant quality, which will be management hassles.
Again, what is your specific investment goal?
Cash flow important? Equity growth important? How much money do you want to generate per year?

What is your current profession?
What skills do you have that you can you offer in real estate investing?
Can you build things yourself?
How much free time do you have for growing your RE business?
WHY are you investing in real estate?
BEFORE you buy any investments, I highly suggest you read the top 6 books on this book list:
0 Reply
Kevin Bonner
OP
Homeowner · Orange County, CA · Member since 2017 · 15 posts · 9 votes
4y
Quote from @Jon Q.:

Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Those markets are higher cash flow, but LOW equity growth markets and you'll generally attract a low tenant quality, which will be management hassles.
Again, what is your specific investment goal?
Cash flow important? Equity growth important? How much money do you want to generate per year?

What is your current profession?
What skills do you have that you can you offer in real estate investing?
Can you build things yourself?
How much free time do you have for growing your RE business?
WHY are you investing in real estate?
BEFORE you buy any investments, I highly suggest you read the top 6 books on this book list:
I currently work in financial planning/portfolio mgmt and have about 10 years experience in remodels/project management. Current house I purchased as a tear-down and rebuilt the whole thing myself- doubled in value since purchase! Have enough sqft here to build a couple adu’s to rent after moving out.

Working with around $200k for down payments and want to start by using as little as I can to test an area and see what kind of team I can build. From there I ultimately want to acquire properties that can cash flow positive.
Open to any suggestions at all or advice on pitfalls to avoid. Been researching and actually read several of those books on the list over last 5 years or so, but had other priorities and just now ready to go all in.

0 Reply
Seth Young
Specialist · Southlake, TX · Member since 2021 · 213 posts · 157 votes
4y
@Kevin Bonner I lived in San Diego for a couple years but now live in Texas. I also work for a turnkey company that is headquartered in Memphis. Memphis offers a solid rental population, lower price points, lots of economic stabilizers and expected growth. Do you plan on managing these properties yourself or working with an established team? Best of luck with all your oos investing!
0 Reply
Kevin Bonner
OP
Homeowner · Orange County, CA · Member since 2017 · 15 posts · 9 votes
4y
Quote from @Seth Young:

@Kevin Bonner I lived in San Diego for a couple years but now live in Texas. I also work for a turnkey company that is headquartered in Memphis. Memphis offers a solid rental population, lower price points, lots of economic stabilizers and expected growth. Do you plan on managing these properties yourself or working with an established team? Best of luck with all your oos investing!

Hi Seth -
100% hoping to work with a team. I’m reading a lot about Memphis the last few days from other members and it seems like a pretty attractive market.

One of my biggest issues is the “over-analysis-paralysis” problem, hence the lower price point goal to ideally allow me to just go for it when something may pop up.

interested in learning more about your company, I’ll take a look and let me know if there’s anything you would suggest.
0 Reply
Seth Young
Specialist · Southlake, TX · Member since 2021 · 213 posts · 157 votes
4y
I get that, especially with interest rates rising makes the analysis even more tedious! When investing out of state the team you work with is equally as important as the market, in my opinion. @Kevin Bonner
0 Reply
Scott Sklare
Real Estate Broker · Beloit, WI · Member since 2015 · 234 posts · 60 votes
4y
Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Hi Kevin,
South central Wisconsin is a fantastic place to invest. 20% cash on cash both SFH and MFH. Let's chat.
2 Reply
Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
4y
@Kevin Bonner
We think the Midwest is a GREAT place for OOS investors to consider!

YES, we may be a little biased, but check out our blog here on BP comparing Detroit to other cities and Deep Dives on Metro Detroit cities & neighborhoods: https://www.biggerpockets.com/...

Your biggest question shouldn't be WHERE to invest, but HOW you will invest!

Many OOS investors set themselves up for failure because they don't truly take the time to understand:

1) The Class of the NEIGHBORHOOD they are buying in - which is relative to the overall area.

2) The Class of the PROPERTY they are buying - which is relative to the overall area.

3) The Class of the TENANT POOL the Neighborhood & Property will attract - which is relative to the overall area.

4) The Class of the CONTRACTORS that will work on their Property, given the Neighborhood location - which is relative to the overall area.

5) The Class of the PROPERTY MANAGEMENT COMPANIES (PMC) that will manage their Property, given the Neighborhood location and the Tenants it will attract - which is relative to the overall area.

6) That a Class X NEIGHBORHOOD will have mostly Class X PROPERTIES, which will only attract Class X TENANTS, CONTRACTORS AND PMCs and deliver Class X RESULTS.

7) That OOS property Class rankings are often different than the Class ranking of the local market they live.

8) Class A is relatively easy to manage, can even be DIY remote managed from another state. Can usually allot 5-10% vacancy factor and same for maintenance.

9) Class B usually also okay, but needs more attention from owner and/or PMC. Vacancy and maintenance factors should be higher than for Class A as homes will be older, have more deferred maintenance and tenants will be harder on them.

10) Class C can be relatively successful with a great PMC (do NOT hire the cheapest!), but very difficult to DIY remote manage. Vacancy and maintenance factors should be higher than for Class A or B. Homes will have even more deferred maintenance and tenants will be even harder on them.

11) Class D pretty much requires an OWNER to be on location and at the property 3-4 times/week. Most quality PMCs will not manage these properties as they understand most owners won’t pay them enough for the time required and even then it’s too difficult successfully manage them.
***Only exception is if an owner has plan & funds to reposition Class D to Class C or higher.

https://www.biggerpockets.com/forums/776/topics/960183-what-they-dont-tell-you-about-cheap-rental-properties?highlight_post=5562799&page=3#p5562799

Also, SERIOUSLY consider - do you really have the time to be a DIY landlord or should you hire a PMC?

Good luck with whatever you decide😊
[email protected]248-209-6824
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1 Reply
Jon Q.
Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
4y
Quote from @Kevin Bonner:

Quote from @Jon Q.:

Quote from @Kevin Bonner:

Hi! Finally in a place where I have financing available and motivated to purchase out of state.

Goal is to keep purchase price down (lower risk intro purchase) and secure some connections in the potential market.

Looking at some obvious areas like Cleveland, Memphis, Indianapolis, but understand there are countless markets to consider.

Would love to meet up or have discussion with anyone in SoCal area with some knowledge regarding experience in the matter.

thanks!!

Those markets are higher cash flow, but LOW equity growth markets and you'll generally attract a low tenant quality, which will be management hassles.
Again, what is your specific investment goal?
Cash flow important? Equity growth important? How much money do you want to generate per year?

What is your current profession?
What skills do you have that you can you offer in real estate investing?
Can you build things yourself?
How much free time do you have for growing your RE business?
WHY are you investing in real estate?
BEFORE you buy any investments, I highly suggest you read the top 6 books on this book list:
I currently work in financial planning/portfolio mgmt and have about 10 years experience in remodels/project management. Current house I purchased as a tear-down and rebuilt the whole thing myself- doubled in value since purchase! Have enough sqft here to build a couple adu’s to rent after moving out.

Working with around $200k for down payments and want to start by using as little as I can to test an area and see what kind of team I can build. From there I ultimately want to acquire properties that can cash flow positive.
Open to any suggestions at all or advice on pitfalls to avoid. Been researching and actually read several of those books on the list over last 5 years or so, but had other priorities and just now ready to go all in.

You’ll need a much more specific investment goal. Otherwise, you risk being inefficient with your time and money and not getting any closer to achieving your goal.
0 Reply
Lane Kawaoka
Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
4y
@Kevin Bonner a lot of fly by night turnkey companies. Make sure you vet track record with past clients.
0 Reply
Joe HammelBusiness Member
Real Estate Agent · Metro Detroit, MI · Member since 2018 · 614 posts · 666 votes
4y
@Kevin Bonner
We have a lot of Californians who love our market.
Can’t get enough of the price/rent/location ratios.
Metro Detroit
(my rental portfolio is here)
Purchase: $80k-$130k
Rent: $1200-$1500
ROI: 10-14%
Cash flow: $250-$350/door
Appreciation: Double digit (for past 10 years, will gladly send data)
Location: C+, B- (suburbs and certain markets)
We have over a dozen Fortune 500 companies just in Metro Detroit with huge Healthcare, Auto, mortgage, Amazon fulfillment, and more jobs.
The bad reputation comes from OOS investors wanting $20k D market properties. We don’t buy those lol.
[email protected]248-422-1685
FIRE Realty Team - Keller Williams5380 Reviews
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