Long Distance investing. Recommendations for assembling a team.

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Long Distance investing. Recommendations for assembling a team.

Junix Alcayaga
Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes

Hey BP community, I've been looking more and more into out of state / long-distance investing for my first property and wanted to get a sense of how others have handled starting out in this same direction. I have a pretty good sense of my criteria (price, deal size, and geography) - I'm looking at SFH and smaller MFH (2-4 units) in the Columbus, OH market. My next step is to assemble a team that can help me make the right decisions and be my boots on the ground, but that's where I'm getting a bit overwhelmed...

I know I can search and network through BP, even get some recommendations from other members here, and research to death on Google to find a seemingly endless amount of lenders, property managers, agents, lawyers, etc., so I'm curious how others made a decision on who to go with and why? What criteria do you look for in each of these "team members"? What are key questions to ask? Is there such a thing as "finding the right ones"?

I guess I'm struggling a bit with the paradox of choice / choice overload, which is leading to a bit of paralysis. Hoping to get a bit of guidance so I can get my team organized and set myself up for making my first purchase.

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    Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    6y
    Originally posted by @Lee Ripma:

    @Junix Alcayaga

    You don’t need a team until you are in escrow. The only team member you need until then is a realtor.

     While this is true this advice can get you into trouble. Your Realtor will not be the one managing the property. There are a bunch of properties I have been wrong on. One of the property managers I refer out a lot, @Donny Thompson, has way more experience than I do in managing properties all around Columbus. I have 24 units that I have been managing for 3 years. He 50x that amount of units he has been managing for 30 years.


    I advise my clients to develop the team of 4 as soon as possible so they can move with more confidence. When analyzing a deal a buyer should reach out to all 4 of their team members for advice.

    I even have clients that will walk the property with their contractor before making an offer. When they go to make the offer they will put 0 contingencies in the contract which allows them to with bids at lower prices.

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    • Account Closed
      Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes
      6y

      I’d start with one realtor who knows the Investment landscape well like @Remington Lyman or whoever you choose will refer you to their top picks for lenders, property managers, etc.

      3Reply
    • Lee RipmaPro Member
      Rental Property Investor · Prairie Village, KS · Member since 2015 · 2k+ posts · 2k+ votes
      6y

      @Junix Alcayaga

      You don’t need a team until you are in escrow. The only team member you need until then is a realtor.

      Podcast Guest on Show #373
      3Reply
    • Remington LymanBusiness Member
      Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
      6y
      Originally posted by @Lee Ripma:

      @Junix Alcayaga

      You don’t need a team until you are in escrow. The only team member you need until then is a realtor.

       While this is true this advice can get you into trouble. Your Realtor will not be the one managing the property. There are a bunch of properties I have been wrong on. One of the property managers I refer out a lot, @Donny Thompson, has way more experience than I do in managing properties all around Columbus. I have 24 units that I have been managing for 3 years. He 50x that amount of units he has been managing for 30 years.


      I advise my clients to develop the team of 4 as soon as possible so they can move with more confidence. When analyzing a deal a buyer should reach out to all 4 of their team members for advice.

      I even have clients that will walk the property with their contractor before making an offer. When they go to make the offer they will put 0 contingencies in the contract which allows them to with bids at lower prices.

      [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
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      12Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      @Account Closed and he's been great!

      1Reply
    • Zeke Liston
      Real Estate Agent · Columbus, OH · Member since 2018 · 1k+ posts · 1k+ votes
      6y

      Well said @Remington Lyman!

      1Reply
    • Will Fraser
      Real Estate Broker · Salt Lake City & Oklahoma City · Member since 2018 · 3k+ posts · 2k+ votes
      6y

      Hey @Junix Alcayaga The Paradox of Choice is real (and an insightful book)!  

      I'll agree with what @Lee Ripma @Remington Lyman and @Account Closed said above and add this: 

      Release the pressure of feeling like your team is etched in stone.  Start with a solid agent and PM and build out from there.  The agent can refer some lenders they've had good experience with, or you can introduce them to your own.  The PM can refer a contractor they've had good experience with, or you can introduce them to your own.  Your agent can refer the title co . . . well, you get the picture.

      But NONE of this is set in stone.  If you find your agent to be a turkey, or the contractor is a hot mess, then move down your list and sow an opportunity to the next vendor on the next deal.    You'll have better luck building the ideal team over time than you will with assembling the ideal team before you start.

      6Reply
    • Mike B.Pro Member
      Developer · Chicago, IL · Member since 2013 · 438 posts · 359 votes
      6y

      For out of state/country investing for holds, I'd recommend finding your property management company first. Construction contacts second (if the strategy is value add) and the Realtor third.

      Property management: If you can't find one you're comfortable with, there's no point in wasting everyone else's time. They are the single biggest factor of failed rentals from afar (in my experience) so it all starts there. They will absolutely make or break your investment.

      Construction: This takes time to find. There's a lot of snakes in the field. Get references and walk a couple of their projects. Pay attention to how many people are onsite working. Wait 4 weeks and go back to the same projects to see how much work was performed during that time. You should be doing this with 3-4 construction contacts to see who performs the best. Ask them how much the rehabs your viewing cost, then break the number down to price per sq ft to help you analyze the deals you're interested in purchasing. Don't take that number as absolute, they will still need to walk the property to make it firm, but it will certainly help you make realistic offers from out of state. Remember, this is a marathon, not a sprint.

      Realtor: While they're extremely important in the process, you can't make offers without knowing your construction costs, again, assuming there's a value add play.

      While you can certainly find people to fill these roles over the internet, it is very important that you go there and perform your due diligence in person. It's possible to find your boots on the ground through the property management company. They have an interest in the property being delivered quickly and to the standards in which they'll be able to rent it. If you vet correctly, all the other contacts you need will come from these three.

      Feel free to message me if you have any questions, I've done this in three markets.

      6Reply
    • Jonathan GreeneBusiness Member
      Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
      6y

      I don't think you can build a proper OOS team without going there. Is it possible? Yes. Is it more likely to be full of holes where  your money will fall through without you knowing? Yes. If you decide on an area like Columbus, go there for a weekend at the very least and put faces to the names. Zoom isn't enough for OOS. You want to meet contractors, property managers, and see the blocks in your target area in real life and not just on Google. If you lock in with a local realtor, that's awesome, but you can't rely on them for everything and they shouldn't want you to. They should be a guide, but they want you to make the decisions and be the final word on who does what.

      If you've never invested, it's even more important to understand rehab costs of that area. What you would have to pay in Brooklyn to do demo is not what you will pay in Columbus. When people do their first investment OOS, the way they lose is by placing too much trust in a team they barely know. With all that said, it can be done, but you want to be more hands-on than you think to do it right.

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    • Lee RipmaPro Member
      Rental Property Investor · Prairie Village, KS · Member since 2015 · 2k+ posts · 2k+ votes
      6y

      @Will Fraser

      I certainly agree that you can find some of the team members prior to getting under contract. I think a lot of folks use “I’m building a team” as an excuse for inaction. If you are in a smaller market you can get a contractor and a PM. If you’re in a larger market there will be submarkets that are 1-2 hours away SO you have to know where your property is before you can get a PM and a contractor. Basically my advice is to jump in on a purchase before you get a contractor and a PM. You’re wasting people’s time in you don’t know where the property is. So you can build a team as long as you are serious. If someone contacts me and says, hey I’m going to buy in a year but I want to talk to you now I’d say call me when you’re actually ready. Way too many people in RE say they will do something and don’t.

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      3Reply
    • Alex Olson
      Real Estate Broker · Kansas City Metro · Member since 2015 · 2k+ posts · 1k+ votes
      6y

      @Junix Alcayaga I like to keep everything as simple as possible. If you are close to putting an LOI on something or have already tried to put a contract on a property, you need to have a lender, insurance, buyer's agent, contractor, and PM for OOS investing in Kansas City. You need a trustworthy team. Treat them well and they will treat you very well.

      2Reply
    • Dan Krupa
      Real Estate Broker · Phoenix, AZ · Member since 2013 · 749 posts · 399 votes
      6y


      @Junix Alcayaga 100% agree with everything @Alex Olson said. Vet the heck out of that team also. Referrals. How many deals? What kind of deals? Are their subs masters? What is their process? How do they relay information and changes to you? Etc... 

      2Reply
    • Yolanda Brown
      Rental Property Investor · Brandon, MS · Member since 2018 · 24 posts · 6 votes
      6y

      I invest out of the state I live in. I looked for a PM and the PM recommended contractors. You could also ask the realtor. Bam, you got an OOS team.

      1Reply
    • Dell J.
      Member since 2010 · 210 posts · 158 votes
      6y

      when I started out of state I got a RE agent. The agent recommended home inspector, and closing lawyer. I found my property manager separaely.  All of my agents reccomendations were good.  I guess good people work with good people.

      you are getting overwelmed because your trying to choose a perfect team before actually doing anything.

      You will have to kiss a few frogs.  Talk to a few real estate agents before deciding to forward with one. Even if you go all the way through with someone you are not obligated to use anyone again on your second deal. 

      You dont need to assemble a team before looking for properties.  Start with an agent  and the property management and the rest will fall in place.

      2Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      @Will Fraser, I appreciate your advice on releasing that self imposed pressure of assembling the ideal team from the get go. I'll of course do my due diligence of vetting potential partners, but will also do my best to remember that it's always possible to move on from a negative partnership. Thanks for that!

      0Reply
    • Benson Gee
      San Francisco, CA · Member since 2018 · 46 posts · 14 votes
      6y

      @Junix Alcayaga if you need a agent in Columbus Ohio , @Zeke Liston is great, he really put a lot of time into his clients.

      1Reply
    • Brian G.
      Rental Property Investor · Los Angeles, CA · Member since 2013 · 1k+ posts · 1k+ votes
      6y

      @Junix Alcayaga 1) decide on a market then 2) start with a rockstar realtor and rockstar property manager 3) go shopping

      Imo the property manager will make or break your investment over the long-run so find the best one and have a plan B choice just in case plan A fails or does not perform.

      A great realtor will have lots of contacts. They will willingly share their network. They have ALREADY built a great team that you get to leverage.

      Great realtors work with other great professionals. Remember this: Eagles fly with other eagles rather than flying with turkeys.

      1Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      Thanks for the insight @Mike B.! Really helpful to get someone else's take on how to go about building your team. Will definitely reach out; thanks for extending the offer!

      0Reply
    • Zeke Liston
      Real Estate Agent · Columbus, OH · Member since 2018 · 1k+ posts · 1k+ votes
      6y

      Thanks for the shoutout @Benson Gee!

      0Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      Thanks @Jonathan Greene. Fortunately I lived in and still have family in Columbus (part of the reason I've settled on that market), so I'll be sure to meet up with prospective property managers, contractors, etc. the next time I visit!

      1Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      @Dan Krupa thanks for sharing some good questions to keep in mind when talking to potential partners! Much appreciated.

      1Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      @Dell J. thanks for the gentle nudge, I'll continue moving forward and try to get out of my own way :)

      0Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      Appreciate the advice @Brian G.! Sounds like vetting property managers will be my next step.

      0Reply
    • Junix Alcayaga
      OP
      Architect · Brooklyn, NY · Member since 2020 · 25 posts · 26 votes
      6y

      @Lee Ripma thanks so much for your insight!

      You mention that you need to know where your property is before you can get a PM, is there ever a scenario where you find yourself in the opposite situation? An example I can think of is you've found a PM that you like to work with, but they don't operate in the area that a potential investment property is located. Do you just go through the steps of finding a different PM?

      0Reply
    • Lee RipmaPro Member
      Rental Property Investor · Prairie Village, KS · Member since 2015 · 2k+ posts · 2k+ votes
      6y

      @Junix Alcayaga

      Well this can easily happen in major metros that are large. It’s very true in LA. In Kansas City it’s true because the metro is large enough. This is why I say don’t find a PM and a team until you are in escrow. You don’t know where exactly you’ll find a good deal. So find a PM that works for that location.

      Podcast Guest on Show #373
      0Reply
    • Frazer Dougan
      Real Estate Agent · Member since 2020 · 1 post · 0 votes
      6y

      @Junix Alcayaga I’m sorry, I’m not experienced in building a team to buy property but I’ve been thinking about the doing something similar in Scotland. But I am intrigued to know whether you would consider (now or later) investing in property in the UK (I’m in Scotland) and would be interested in chatting if it’s something you would consider?

      Either way, all ll the best with building a team and getting the properties you’re after!

      Frazer

      0Reply
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