Where to Buy my First Out-of-State Multi-family

8 Replies

I am new to RE investing, but am very ready to pull the trigger on purchasing my first rental property outside of CA (where I live).  I understand the CA market is poor from a cash flow perspective, and the barriers to entry are very high from a cost standpoint.  I work a full-time job, have a strong/stable income, near perfect credit, 3 days off/week to dedicate to RE, access to frequent and inexpensive airfare, and enough saved for 20-25% down on a 50-150K property.

My criteria would be at least a triplex (preferably a four-plex) that needs minimal rehab that also falls within a relatively-stable rental market.  My searches have led me to explore various parts of Indiana, Tennessee, Ohio, North Carolina, and other states - mainly because my criteria is accessible at my target price point in these states (I plan to purchase conventionally).

Ultimately, what is the best location for me to hone in on deals?  I would like to cash flow positively with minimal upkeep (obviously), but I just mainly want to take the plunge on my first deal to get my feet wet, learn, grow, etc.  I would also like property taxes, PM, insurance, and vacancy (+ whatever I am overlooking) to all be factored into my monthly expenses.

WHAT IS THE BEST LOCATION FOR ME?

ARE YOU CONNECTED w/ ANY INVESTORS/REALTORS in IDEAL AREAS?  

As of now, I have just been blindly looking into any location that I read up on online, sparks my interest, has low prices, etc.   I am open to turnkey opportunities as well.

Thanks in advance as any advice will be a huge help,

John

We aaaare FRESH out of deals here Tennessee! No deals..move along....nothing to see here ..and If you could pass that along to the rest of the Californians, that'd be great! lol

Hey John! I'm in CA as well (LA/Venice) and buy out-of-state. If you want MFRs specifically, teh trick there is that not all of the cities have ones that will really cash flow. The states you mention are good in general for cash flow areas, but more for SFRs. I either have worked with SFRs in most of those or still do. Different markets are better for MFRs. Right now I work with ones in Chicago and Philadelphia. All cash flow really well and none of them need work when you buy them. Reach out if you want to hear more on them. I never buy properties needing work. Too hard to do from long distance and too much of a pain.

John,

PM me if you'd like to look into Northwest Indiana. We're about 40 minutes from Chicago and we have a lot to offer. The area is very diverse, regarding pricing and good cash flow for multi plexes. 

We have our own rehab crew, property manager and realtors for flipping.

Good Luck!

Your very first step in the process is to study the state landlord tenant regulations in each state and determine which is the most landlord friendly. Assuming you can invest anywhere the first priority is ease of operation of your business. This means the state which affords the landlord the greatest legal support in dealing with bad tenants. Good cash flow deals can be found in almost every possible location in the country. Choose the location that is most business friendly since tenant issues are your primary source of problems. 

I would recommend Chicago. Rents are really good, and vacancy is usually never a problem, especially if you buy in areas where there are very good elementary schools. Yes, people complain about property taxes, but they are still lower then the suburbs. The combination of low PITI and high rental prices you can definitely have a nice rental that is profitable.

John ,

I would recommend TX . Very stable economy , and rent to price ratio is 

great. If you live in Bay Area you may consider coming to the "Multi Family / Single Family Out of State Investing" meetup. This is a group that concentrates on multi family education and networking..

Originally posted by @John Singer :

Ultimately, what is the best location for me to hone in on deals? 

WHAT IS THE BEST LOCATION FOR ME?

Here's a Forbes article from July 2016 on the Top 20 areas to invest in rentals in the US.  I"m not sure I fully agree but it's a source. 

Good luck.

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