I'm a new investor, I actually just bought my first rental property this week. The problem I'm facing is....I eventually would like to move to another market because I don't see myself staying in Texas forever. My question is...how hard is it to invest in a market you don't live in? Can it be done? My plan is to move to this future market one day...but won't be able to until I can quit my job.
Is it more reasonable to invest in my current market...build a portfolio, and eventually move after I acquire enough real estate to quit my job? Or is it possible to start investing in this future market in preparations to move there within the next few years.
I hope this all makes sense. This is my first post and I expect to be a long time member once I get my feet wet and start acquiring rental properties. Thank you all in advance for your suggestions.
I have found it quite easy to invest in buy and holds in other markets. I am doing flips in other markets also but must find reliable general contractors. There have been markets where I haven't found them yet.
Welcome to Biggerpockets!
Congratulations on your first house. The first is always the hardest. Once you have it your hooked, at least that was the case for us.
My husband is active duty military. So we are a very transient population. We move a lot, and it's all over. We own 5 houses (4 rentals) in 3 different states, 4 different cities. The houses in Charleston, SC were pure investments. My husband went to school in Charleston but when we bought the properties we lived 6 hours away.
I started a blog/website about our experiences because it has been so rewarding. Oh it has had its moments but everything has its moments. We have been successful self-manaing retaining our profits. In my experience no one care about your property as much as you do. So this allows me to keep control over my properties and prevent a middle man.
We plan on trying to buy our "retirement" home in a few years. We want to lock in the rate, price and have someone else pay on our mortgage. We don't plan on settling down for 15-20 year depending on his navy career.
So to answer your questions directly. While investing in a market you don't live in can have its challenges it is totally dupable. We also don't plan to move into our final market until he gets out of the Navy.
We invest in our current market, past markets, future markets etc. When we finanally get out of the navy and settle down. We plan on consolidating all of our houses into the one area doing a 1031. This allows you to sell the house and as long as you reinvest the houses within certain rules you don't have to pay back deprecation or pay the capital gains.
Good luck! Check out the blogs and podcasts. Let me know if I can help. I totally get where you are coming from!
Thanks Elizabeth! That totally helps a ton! Your situation is similar to my situation. My wife and I move a lot too...and I know I'd like to potentially retire in a west coast city eventually.
When buying your properties outside of your market, do you fly out to look at them or purchase them directly from online viewing? Do you make frequent trips out there to check up on tenants and make sure the house is in order? Do you use a realtor to at least get a tenant into your property and get the paperwork all situated?
I apologize for all of the questions but my mind has been racing ever since I made a bid on this first property. I think I'm already hooked and I haven't even owned it a week yet.
We hope to retire in Sausiliteo outside of San Francisco. So in the next 2 years we are going to start look for a house that would make a rental now and a great permanent retirement home for us in the future.
I guess it depends. For investments we try to see it before we buy it. When we bought in the same area we had the practices in place. So we have gotten a lot more lenient since some of our areas our track homes. We have had a friend help install a tenant. Every area we have done things differently. When we moved out to California we did a sight unseen house because we needed a place to live.
While you are first establishing an area I HIGHLY recommend you going to look at it and the closing. As you start to get a team in place you will find that you won't need to do as much. The area I am in currently, I put offers on houses without even looking at them based on the area and price. Once we get the house accept through a short sale. Than we look at it :)
We buy class A properties. Our tenants are all professionals so we are able to manage them with little oversight. I check on the properties when I come into town but usually don't make a specific trip unless I need to do a change over.
I do the paperwork myself. I use a friend or I fly in for tenant change over. My tenants usually will show the house for me. My blog/website when up and running is all about my experiences and material to self manage from a distance. It's all free, just hoping to pay it forward since we have lot of luck.
It totally understand what you mean about the 1st one setting you on fire. We bought our first house Oct. 1st 2011 and haven't looked back. We are on track for 6 and 7 in the next 12 months.
I appreciate all the advice. That makes me much more comfortable with buying outside of my market. I'll keep an eye out for your blog/website. It'll be nice to get an inside look on how you and your husband went through everything.
@ Elizabeth C: Great advice! I live in Palmdale and invested in 6 houses in Frisco, Texas. I did all of my research online, developed my investing model for Texas, and was put into contact with a local Texas real estate agent. We talked and I told her the criteria of the property I was looking for. When she found it, I flew out to Texas to meet her, see the properties, sing the purchase agreements and put down the earnest money. Unfortunately I didn't close on these properties (long story), but I would have closed the deal via fax and email, and then I would have worked with the real estate agent to sell them or a property management company to manage them.
The purpose of the story is to show you that as long as you have a good team in local real estate professionals, it is in their best interest to do their job well in order to get repeat business from you. Finding the right team members is the challenge.
God Bless You!
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