Rental Property Investor · Gresham, OR · Member since 2018 · 36 posts · 19 votes
My wife and I want to buy another rental within the next 90 days! We are finding that the best deals out there are 2500 miles away from where we live. This makes us nervous. Do we find a deal that looks good on paper... make an offer... then if accepted fly out and take a look at it from there? What’s the best way to go about this? How do we know who the best people to work with are? I know this a very broad question. We just have no idea where to begin on a place so far away.
Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
8y
Matthew Powell alright so I have successfully done this in two different markets (Cleveland and Memphis) in the last year or so.
1. Network on BP to find agents, PMs contractors, lenders, etc. make sure they specialize in out of town investors
2. Get on an airplane and go visit and meet them
3. Look at properties, look at more properties and analyze
4. Buy something
5. Profit.
Now this is the simplified version but it’s basically what I did. Now also make sure you educate yourself first. At 12 posts you’re likely new, so read forums, blogs listen to podcasts. I listened to over 200 podcasts before my first rental
My first property was through a turnkey company and my second wasn’t. I think turnkey can be a good way to start but make sure they allow you the ability to do both (meaning they’ll manage properties that you don’t buy through them).
Cleveland, OH · Member since 2018 · 133 posts · 59 votes
8y
@Matthew Powell I would recommend the other way around. If you don't have experience investing in a particular area or have trustworthy boots on the ground, then you should fly out and look at what you're getting BEFORE you make an offer. You'll be able to assess the structure, get a feel for the area and vibe of the city. That way if you decide to make an offer you have a higher level of clarity and certainty on what you're investing in. The price of a plane ticket and hotel can be much less expensive than property and management issues from 2.500 miles away.
Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
8y
Matthew Powell alright so I have successfully done this in two different markets (Cleveland and Memphis) in the last year or so.
1. Network on BP to find agents, PMs contractors, lenders, etc. make sure they specialize in out of town investors
2. Get on an airplane and go visit and meet them
3. Look at properties, look at more properties and analyze
4. Buy something
5. Profit.
Now this is the simplified version but it’s basically what I did. Now also make sure you educate yourself first. At 12 posts you’re likely new, so read forums, blogs listen to podcasts. I listened to over 200 podcasts before my first rental
My first property was through a turnkey company and my second wasn’t. I think turnkey can be a good way to start but make sure they allow you the ability to do both (meaning they’ll manage properties that you don’t buy through them).
Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
8y
Figure out how much you can get pre-approved for..............then......figure out do you want to do long distance flipping? If so reach out to @David Greene Do you want to do investing strictly for cashflow....if so figure out the best markets......Full disclosure....I live in California and invest in the Bay Area and in Cleveland. Duplexes there seem to have the highest cashflow in "C" Neighborhoods. Reach out to @James Wise for more info.
If you want to invest long distance AND have appreciation? I am not versed in that but there are others on BP that are.
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
8y
Originally posted by @Account Closed:
In “ The Millionaire Real Estate Investor By Gary Keller “ On Pg. 269 he has a chart titled:
“ Control The Property & Include Escape Clauses In Your Offer. “
Escape Based on Condition at Inspection.
Escape Based on Results of Feasibility Study.
Escape Based on Financing.
Escape Based on Repairs.
Escape Based on Other Party Approval.
Hope That's Helpful His Book Is Really Good.
That many escape clauses aren't gonna fly if the listing agent knows what they are doing. For example there is typically a 0% chance an offer including all 5 of those items would ever get accepted by a seller represented by me. That offer would get rejected faster than an Andrea Iguodala layup attempt in the finals.
Rental Property Investor · San Antonio, TX · Member since 2017 · 88 posts · 167 votes
8y
Matthew Powell you should definitely check out David Green’s book “Long Distance Real Estate Investing”. He will explain how investing in another market that’s not local to you, is not much different than investing in your own backyard. By getting your team together first in the long distance market you will have no problem finding deals. Especially if you are finding rockstar agents, lenders, investors, contractors, etc. Once you have your “core four” together as he calls it, deals will be a lot easier to find. And tbh it makes sense to find your team before you find the deal, because if you tried finding the deal first and your scrambling to put together a team of people you will either lose out the deal or you won’t have a good enough team to be as successful as you could’ve been had you found the best team you can find.
Aurora, OR · Member since 2017 · 44 posts · 58 votes
8y
Matthew,
I am about 10 minutes away from you if you would like to meet up and chat. I have some properties here in the Portland area, but am also investing in the Kansas City Market.
I had all the same concerns that you have expressed and jumping on a plane to spend a few days in the market, meeting the local operator that I was interested in working with, and physically seeing their work was instrumental in getting over my "mental hurdle" of purchasing out of state.
Rental Property Investor · Gresham, OR · Member since 2018 · 36 posts · 19 votes
8y
@Alex Kamunyo I actually am expecting this book in the mail today. Super excited about getting this process going. Thank you.
@Lane Kawaoka My goal is to be able to partner with other investors and get good deals that benefit all parties. Should be there in no time.
@Caleb Heimsoth seems like a good plan of action. I have been soaking up the information on all the podcasts for a few months now. Just recently took the dive into actually becoming a BP member. Figured it was time to finally get involved in some active discussions.
Rental Property Investor · Gresham, OR · Member since 2018 · 36 posts · 19 votes
8y
@Brian Garlington that’s quite the jump from the Bay Area to Cleveland. Definitely two completely different markets. Our main focus right now is to get a steady chunk of cash flow going. Once we are able to replace my income I will be able to focus more and help on rehabs. That’s the plan at the moment, but if the right deals pop up things may shift.
Rental Property Investor · Gresham, OR · Member since 2018 · 36 posts · 19 votes
8y
@Account Closed ahh yes Iggy did not stand a chance against the king. I will have to keep in mind that not every detail in all books are to going be accurate. Should be a fun process! Thank you!
Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
8y
When we lived in Ca we bought 3 properties south of Seattle. We researched on the internet, checked out a couple of realtors, and picked one that was into investment properties. We gave her our lists, had her do some more in depth checking and then my wife would fly there and view the properties, 7 to 8 per day worked fine. My wife and I did the internet searches and made up the list, the realtors never picked-they just did a little more research and made appointments as needed, my wife would fly out and decide, we always made offers subject to inspection. We found that it worked much better when we picked the candidate properties on the internet rather than relying on the realtor to do the picking. The market south of Seattle was great a few years ago. ;<)
Fort Mcmurray Alberta, Canada · Member since 2017 · 26 posts · 3 votes
8y
You could easily use one like the financing one or even the other party approval to get out of the purchase. @James Wise. What would be your idea of a Escape Clause if you disagree ?
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
8y
Originally posted by @Account Closed:
You could easily use one like the financing one or even the other party approval to get out of the purchase. @James Wise. What would be your idea of a Escape Clause if you disagree ?
I'm not understanding what your asking here. Can you rephrase please?
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
8y
Originally posted by @Account Closed:
In your deals what do you put in the Escape Clause so your having a deal under contract that you cant get out. @James Wise
You need to reevaluate this whole line of thinking. You shouldn't be going into a deal with the intention to get out of it. When I put my signature on a purchase agreement you can bet your a** that I am going to buy that property. Otherwise why go through the motions? You won't get very far in this business if you are jerking people around wasting time running through the motions.
And back to my original point when you are trying to buy like this you are going to run into people like myself on the other side of that transaction who have seen 1,000's & 1,000's of deals. We see right through those escape clauses & sniff out a time waster immediately. Once you are labeled a time waster that is going to follow you in this business forever.
Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
8y
Sheldon Whalen I agree with James Wise you really shouldn’t be going into a deal with the intent to get out of it.
That being said I think it’s okay to have a financing contingency as sometimes I can’t control what the bank says. Same goes with an appraisal. If going in it should appraise based on comps then that’s likely not an issue but sometimes it can still be low.
Sheldon Whalen I agree with James Wise you really shouldn’t be going into a deal with the intent to get out of it.
That being said I think it’s okay to have a financing contingency as sometimes I can’t control what the bank says. Same goes with an appraisal. If going in it should appraise based on comps then that’s likely not an issue but sometimes it can still be low.
When buying a property there are 3 very reasonable contingencies.
Inspection.
Financing.
The property appraising for at least the purchase price.
The majority of my clients are all out of state investors. On most all of my deals I essentially force my out of state buyers to get an inspection whether they originally intended to or not. Lots of people don't know what they don't know & that's a liability bus I am not planning on being ran over by.
That said those above reasonable contract contingencies are very different than dealing with a potential buyer who is going into a contract with the thought process of utilizing an escape clause. Being a buyer who wastes peoples times is so transparent. I would argue that merely referring to one of those contract contingencies as an escape clause is enough to sour me on spending an ounce of my time on a buyer. Experienced Brokers & Agents can see right through that & trust me we will not hesitate to black ball a buyer who wastes time.
Rental Property Investor · Gresham, OR · Member since 2018 · 36 posts · 19 votes
8y
@Brandon L. A good deal to me is something that makes it worth my time. If that makes sense. Not all “cheap” properties are good deals to me. If I were rehabbing a property to sell and make a profit, I would not consider a $100 profit from a 6 month long rehab a good deal.
On the rental side if I were to pay $30,000 for a property that generates $600+ a month after all expenses paid that is a good deal to me. Good deals come in all shapes and sizes.
Rental Property Investor · Phoenix, AZ · Member since 2013 · 919 posts · 911 votes
8y
@Matthew Powell, Morris Invest is full of those types of deals. ;-) until it’s time for you get your rent check. My own exploration/study found that IF you could get a property for $60k in the Midwest AND rent it for $700, that the state tax man was gonna take $200-$300 a month in property taxes.
Add in that many are in war zones, your probability of getting paid decreases. And that’s before you go to eviction costs, remodel/re-ready the property, etc.
I don’t know of any location in the country where you can SAFELY get $600 a month on a $30k property. I’m thinking they are like unicorns. ;-)
Rental Property Investor · Gresham, OR · Member since 2018 · 36 posts · 19 votes
8y
@Alan Grobmeier oh yes those numbers may have been a little exaggerated. 😀 But anything is possible. I have found a few places around the country that on paper they put out those numbers. I supposed if I screened tenants really well I may be able to lock in a few good long term tenants. In those areas though you are most likely correct in the sense that being paid may not be as easy as it sounds. Will be a fun journey I am sure.
My daughter believes in Unicorns... So maybe there’s a chance. 😉
@Matthew Powell, Morris Invest is full of those types of deals. ;-) until it’s time for you get your rent check. My own exploration/study found that IF you could get a property for $60k in the Midwest AND rent it for $700, that the state tax man was gonna take $200-$300 a month in property taxes.
Add in that many are in war zones, your probability of getting paid decreases. And that’s before you go to eviction costs, remodel/re-ready the property, etc.
I don’t know of any location in the country where you can SAFELY get $600 a month on a $30k property. I’m thinking they are like unicorns. ;-)
Netting $600/mo on a $30k property & considering it being a "good deal" is like saying Scarlett Johansson is "kinda cute" 🤣🤣🤣