Looking for tips in buying rental houses out of state. We're in IL, so wondering if because of the subpar financial health of our state, would it make sense to buy elsewhere? Makes me a little nervous to make this jump as we're so far removed from the markets. How do others mitigate the risk of doing this? Thoughts on potential markets? Thanks!
I've owned properties in as many as 6 states at once. Owning isn't that hard. Getting set up is the hardest part, but I've enjoyed the benefits of multi-state investing. Often when one market is swinging down, another is going up. It gives you a lot of flexibility as an investor to maximize returns.
Probably the most critical part is buying. Finding a solid property at a good price is harder if you do not live there. Many turnkey rental providers can solve that problem. The only downside is you aren't going to get a deeply discounted price, you basically pay near-retail. Regardless, find a local property inspector to check things out for you. (Don't take an inspector recommended by the seller) Ask them to take lots of pictures.
The second most important part is fining a good property manager. I've had success with NARPM. With a good property manager and a good property, managing out-of-state rentals is a piece of cake.
I've actually bought, owned, and sold 4 properties in 4 states that I never once saw with my own eyes. I made good money on every one.