Out of State REI. The good, the bad, and the ugly.
Hello BP Community! I'm new here and to REI. Like a lot of people, I'm looking to better my (and my family's) quality of life and financial situation through REI. I live in San Diego, CA with my wife and 2 beautiful children.
I'm currently in the beginning phase of my journey and just trying to soak in as much information as possible. I think my target properties will be MF units and out of state. After running the numbers in my locality and the amount of capital I have, investing in my backyard does not look to favorable on paper. This would be my first investment into real estate. Based on my current situation, I'll be ready to invest in a 8-10 months.
There are a lot of people out there that advise against out of state REI (especially for a first-time investor), however, I don't agree with that methodology completely although they make valid arguments. My question to the BP community is targeted to those who have invested out of state successfully.
1. What steps did you take to lower the risk of failure in investing out of state?
2. Did you use a syndication or partnership with someone local?
3. What are the good, the bad, and solutions you experienced in your REI journey?
4. Best advice you have to a new investor looking to invest in multi-family properties out of state?
A side question for a syndication. I believe as a requirement, under current law, an investor has to be an accredited investor or a sophisticated investor. The definition I've found online all appear to be pretty vague as to what a sophisticated investor is. If any syndicators are reading this, can you clear up what a sophisticated investor is?
Thank you all in advance!