I just finished the book Long Distance Real Estate Investing by David Greene. I am excited and nervous to get started.

Has anyone else read his book and put the principles to action? What is your experience?

@Patrick Keene I'm sure the book is awesome.  However I've never read it.  I've been investing in the Mid-West from the East Coast for years.  I would not change this strategy for anything in the world.  Here in NY you cannot buy a wet paper  bag for under $375K whereas you get a much bigger bang for your buck.  We are a little under 96 Units within our network of investors.  Best advice I can give you will be to visit the market and vet the team you are building.  I spent 18 months in the market before I started investing in the market.  All the best.  Always remember to persist and you will WIN!!!!

@Shawn Ackerman Thanks for the encouragement!

@Patrick Keene

I have done it. When I did it there was no book about it.

It's a little more difficult buying property long distance. When I did it I couldn't find a title company that could do E-closing, so I had to take a day off work and go to Phoenix to sign paperwork.

Aside from that everything I did was over the phone or on the internet.

In terms of management it's the same. Everything is electronic and I haven't seen my two properties in Arizona in years.

Lately I've been looking out of state again because even though Nebraska is relatively inexpensive, multi family is hard to find.

Have not read the book, but I am a California resident and have a property manager taking care of 3 SFRs in Kalamazoo, MI.  It’s a very rewarding process but there have been no shortage of hiccups along the way.  However, I think this is par for the course and I’ve been making money while adjusting as I go along.

I find the hardest part is to give up the sense of control that is natural to have in this endeavor. What I mean by that is, if I don’t hear from my property manager for a day or so, not to worry. She’s built up my trust that it will get done, and that she has a team in place to take care of problems.

I lucked into this prop manager in the sense that I knew less than nothing when I moved away from Kalamazoo (I did live there for 5 years so i know the town well). I think I googled “kalamazoo property manager” and signed up with the first hit, that kind of clueless. Turns out she is a great boot on the ground and has gotten tenants, good ones, within 1-2 weeks each time there has been a vacancy.

I'm a newbie and love David Greene's book. I'm making a trip out to the market I'm targeting in a few weeks and building a team on the ground there. I'm ready to make offers after my 'scouting trip' and I'm sure I will have a lot to learn along the way. Great to hear from other successful out-of-state investors!

Question for those who are doing this, how often to do communicate with your PM? I assume it depends on if they are actively managing a rehab or finding a new tenant, but I'm curious.

Originally posted by @Patrick Keene :

I just finished the book Long Distance Real Estate Investing by David Greene. I am excited and nervous to get started.

Has anyone else read his book and put the principles to action? What is your experience?

It is very common to invest OOS. Many investors live in areas where they cannot find a good return, like CA, NY, etc. They will often invest in the Midwest where they can find a much better ROI. One way of doing it is a Turnkey investment. Of course, there are many other different kinds of investments for OOS, that is just one!

Originally posted by @Patrick Keene :

I just finished the book Long Distance Real Estate Investing by David Greene. I am excited and nervous to get started.

Has anyone else read his book and put the principles to action? What is your experience?

 Patrick,

Why do you want to invest out of state? Typically the reason one looks out of state is because they are living in an incredibly expensive market such as California & or New York. They usually look to cash flow markets like Ohio, Indiana, Memphis etc... to achieve cash flow as they are priced out of their hometown markets.

You being from Kentucky shouldn't be priced out at home. I imagine the price points are somewhat similar to the above markets no? Let me know if I am off base here.

Several investors have bought apartments out of the area and trusted property manager to pay mortgage etc.  After getting notice of default and liens on services not authorized they realize the property manager cashed the rent and wrote bogus repair checks and fled. One investor lost his life fortune and watched his 16 units auctioned off. Another found out the property manager company filed bankruptcy never returned the deposit.

Invest in places like Vegas, Phoenix is OK. Midwest I know they are cheap but it takes a certain mind set to see home valuation stays put decades after decade.  If you are stuck with not good places. You wish you had put money in the bank or into stocks with a liquid asset.

@James Wise I live in a small college town (6000 people in the city and 10000 at the university) which is already crawling with investors. I know of at least 3 new apartment complexes being built as we speak. There isn't a ton of opportunity to jump into a home with equity. Admittedly, I am still learning where to look.

I have decided to use the principles of the book to get started in the Northern KY/Cincinnati Metro area which is only  a couple of hours away. This way, I get the best of both worlds. It is close enough that I could go see a property if I wanted to but it is far enough away that it forces me to depend on others without putting too much pressure on myself . That may be a bit idealistic but its a work in progress.

My realtor showed me our first lead yesterday. Even though it wasn't what I am looking for it was exciting to get the process rolling. I would welcome any advice you would have for me.

Originally posted by @Patrick Keene :

@James Wise I live in a small college town (6000 people in the city and 10000 at the university) which is already crawling with investors. I know of at least 3 new apartment complexes being built as we speak. There isn't a ton of opportunity to jump into a home with equity. Admittedly, I am still learning where to look.

I have decided to use the principles of the book to get started in the Northern KY/Cincinnati Metro area which is only  a couple of hours away. This way, I get the best of both worlds. It is close enough that I could go see a property if I wanted to but it is far enough away that it forces me to depend on others without putting too much pressure on myself . That may be a bit idealistic but its a work in progress.

My realtor showed me our first lead yesterday. Even though it wasn't what I am looking for it was exciting to get the process rolling. I would welcome any advice you would have for me.

 I was just going to say you're not too far from a great market in NKY/Cincy. If you need an agent referral let me know. I'm friends with multiple investor/agents in this market. Also Lexington and Louisville are decent areas right now too.

I do it and will continue to do so.

I haven't read the book, but invest long distance. You have some great markets within a few hours of you to choose from, so I would start there. The key is to get your systems and teams into place. 

@Patrick Keene As you've already heard from the rest of our little peanut gallery, OOS investing is very very common. But as @James Wise said, it is typically done by people who A) are priced out of their home markets (@Shawn Ackerman I literally laughed out loud at your wet paper bag comment, the only time I wish there were Facebook-esque 'laugh react' options on BP lol) or B) are looking to diversify into other markets to spread investment risk around. 

Now, that's not to say that, even if your home town/state is affordable, OOS isn't for you - many people just prefer the idea of being close to their investments, for obvious reasons. BUT if you don't want to be hands-on, if you're going to hire a property manager anyway, if you are looking for your investment to be as passive as possible, then it makes little difference how far away your props are as long as the numbers work and the people handling those investments are trustworthy. Having faulty numbers or scammy investment partners is going to ruin an investment whether it's next door or across the country. 

That being said, a lot of new investors, especially (though not solely), just like the security they feel comes from being able to drive to the property, if they want to. They may never actually do it, but they like knowing they could. Investing is psychological as much as financial, so it's about how much control you need to feel. If you're cool with giving up control in exchange for passivity, trading hands-on experience for professional management, then OOS is absolutely a great option regardless of how your home market is doing. Of course, most states have higher prop tax rates for non-resident investors, so bear that in mind. In some cases that's a big deal, in others, not so much. In Birmingham our property tax rates are so low that even when you double them for investors (as a rough rule of thumb) you pay about $1k annually on a prop that produces $13k in net rents (maybe a bit more or less, depending on special districts, etc). My point being, there are things to consider when you go OOS, but it can still be a very profitable option if you do your due diligence. 

Best of luck!

@Patrick Keene anytime man! Keep on grinding.

@Patrick Keene I've been investing out of state for over 10 years and I just finished David's book. Wish I had been able to read it 10 years ago. The book has solid tips and solid strategy. Personally I've found it more beneficial to start with contacting property management companies first. They are just much more responsive and I've found they are the key to out of state investing. You HAVE to find a good one. And I also recommend finding some solid backups, just in case. And your PM just might have a line on off market properties. David recommends starting with the highest performing agent - good luck getting a response from them. I'd start w/PM, and then ask on BP or search forums for that. Someone has already asked in most markets. Also reach out to other investors on BP in that market. They can be very helpful. Build some relationships. But overall David has great tips, I think some are more realistic than others - I've never ordered materials from Home Depot and then price comparison shopped and negotiated lower prices. I don't know how the hell he did all of that working 90 hours a week. But it is a good tip. If you've got that kind of time. Best of luck man. Feel free to hit me up with any questions. 

@Patrick Keene I totally agree with @Shawn Ackerman. I am pretty sure the book is great but I haven’t read it.
Even without reading it, I know what is needed to do out of state investing. I own properties in IA, AL and GA but I live in SF Bay Area. I so far own 22 doors and all are at least 250 miles from I live. I would not invest locally because NorCal and SoCal markets are speculative and do not generate positive cash flow.
Good Luck!

i also live in norcal & bought a sfr in memphis 2 yrs ago. Been great so far. The property mgmt company rehabd it & sold it to me & take care of all the rents/renter. I only hear from them once a month via email. No news is good news. They know what they are doing. When searching for a property manager get referrals & call them!! Such a better return than cali. I cant find clients homes that cash flow (well at least ones you can drive to at night)

@Grant Rothenburger That is great to know! This realtor seems to be really hustling for me so I'll give her a shot. However, I hear realtors with investor mindsets are hard to come by so I may be connecting with you about that in the future.

Originally posted by @Patrick Keene :

@Grant Rothenburger That is great to know! This realtor seems to be really hustling for me so I'll give her a shot. However, I hear realtors with investor mindsets are hard to come by so I may be connecting with you about that in the future.

 Anytime!

Good wisdom there! Thanks @Clayton Mobley

Thanks @Jason Carter , I am two weeks in and can relate to that. My agent seems great but after vetting a PM he had some great referrals, too. Kind of wish I went that route first.

Just started the book two nights ago. Look forward to finishing so i can hit the ground running.

I'm working on finalizing my fourth out of state turnkey investment and have been feeling more and more like I need to take the whole process in my own hands to really maximize what I learn and what I can get out of it. David Greene is one of my all time favorite guests on the BP podcast and his book is fantastic for a person in my shoes. At this moment, I'm re-reading it a second time. This time, I'm actually listening to the audio book while following along in the actual book with a highlighter and noting all the essential components page by page. Then transcribing those notes into a searchable doc so I can have a clear, concise reference point for doing this myself. All that work helps me retain what I need to know to do this effectively (to my own standards, that is!) It may be overkill for most, but I know how my own brain works and so far it's been a really impactful process. I'll keep you posted as I begin to jump in thanks to what I have learned from this book.

Update: We are now at 198 units in the Milwaukee market. Amazing what 3 momths can change. @Patrick Keene i hope you have narrowed down your search and are continuing to put the pieces to your puzzle together my friend. All the best to you!!!