Buying Out of State
Hello, My names Dan, I'll be 21 in a couple months and I live in Newport Beach, CA. I've been looking to buy rental property's for a few years now and finally started diving into it recently.
Houses here are at least 650k to 2mill and I don't know of any investors willing to put up 100% financing for homes like that to a rookie REI. Even if I did get one, the rent wouldn't cover the mortgage. High rollers here want to buy, not rent. Unless you get beach front property for the "out of towners".
Anyway, I've been looking at property in Texas around the 100k and under range and wanted to know how I go about buying property out of state?
I have a handful of knowledge about REI and maybe I might be missing some possibilities that are right here in my backyard but I wouldn't know. If you have any ideas or anything like that, that'd be awesome.
Thanks for the help.
#3 Off Topic Contributor
- Investor
- Viera, FL
You're 21. Road trip. No joke. If I am looking out of state, I always take a road trip to the area(s) I'm considering. I meet with half a dozen realtors and property managers - then walk around the town and talk to the locals. I tell them I'm considering moving to the area (dressed in t-shirt and jeans) and ask where the nice areas to live are. You get a lot of information just from going up to random people (especially those who are bored and behind a counter) and talking to them.
lol yeah. I've been thinking about jumping on the greyhound and just going out there.
Knowing that I can get a deal financed before I go look seems to be what's holding me back. I'm going to a local REI club in April to try and find some private lenders and wholesalers I can connect with.
Or, since the properties will be cheaper in AZ and TX, I might be able to do owner financing for desperate sellers. I still need to get educated I believe. I started diving in about 2 weeks ago and trying to do some research on what I need to do to make this happen.
Thanks for the idea by the way.
#3 Off Topic Contributor
- Investor
- Viera, FL
Trust me - rent a car. You will probably find some city on your way to those destinations that will have what you're looking for and is closer.
Have you checked to see what conventional financing you qualify for? Owner financing on sfr's is not as easy to find as gurus would lead you to believe. It is possible but believe me - you are paying a premium for it.
Tim, I've noticed on a couple of threads you've mentioned specific home prices in different areas (a recent thread regarding south FL comes to mind). I was wondering what tools/sites you use to efficiently pull up that info? Difficulty in researching prices and especially rents has been something of a barrier to me when it comes to investing out of my area. Any tips would be greatly appreciated.
#3 Off Topic Contributor
- Investor
- Viera, FL
Sure: Yahoo maps to find city names, Realtor.com to check mls prices, then Craigslit to check market rent. Use google earth sometimes to check an area but I usually find myself doing that more afer watching Jason Bourne movies and put a funky spy movie soundtrack on my laptop. Once all that's done it's about 4-6 months and at least $20,000 in research to make sure I know the market correctly. That takes a bit longer to explain but it's necessary.
On looking for investments out of state, I urge you spend twice the time researching the deal. Investing long distance can be extremely challenging, and I do not recommend it for new investors.
You become reliant on too many other people, and when things are out of your hands, control becomes an issue. There have been many threads on the site discussing this issue because as you said, it is difficult to get in to some markets.
#3 Off Topic Contributor
- Investor
- Viera, FL
Very true Josh. My recommendation to new folks is that are going to invest out of state - if it's over an hour and a half drive away, move to the market you are going to invest in. Yeah, it may not be as "cool" an area but what are you willing to do for your financial independence?
Originally posted by "MaverickDan":
Hello, My names Dan, I'll be 21 in a couple months and I live in Newport Beach, CA. I've been looking to buy rental property's for a few years now and finally started diving into it recently.Houses here are at least 650k to 2mill and I don't know of any investors willing to put up 100% financing for homes like that to a rookie REI. Even if I did get one, the rent wouldn't cover the mortgage. High rollers here want to buy, not rent. Unless you get beach front property for the "out of towners".
Anyway, I've been looking at property in Texas around the 100k and under range and wanted to know how I go about buying property out of state?
I have a handful of knowledge about REI and maybe I might be missing some possibilities that are right here in my backyard but I wouldn't know. If you have any ideas or anything like that, that'd be awesome.
Thanks for the help.
at 21 i definitely wouldn't be looking for rentals, i'd find a way to make money right where i am. do u know of any local REIA groups? go there and see what other investors are buying and locate deals for them.....
doing your first deal out of state so far away can be tricky without a good team in place. it's not impossible though. cris chico buys out of state all the time. do u know anyone in texas that u trust to give u accurate values and a good assessment of the market?