Remote Investing for First time Buyer

7 Replies

Hi BP Members!

I’m a first time buyer interested in making a remote investment. I live in the Boston, MA area, and I’m considering areas of the country with strong past performance:

https://www.biggerpockets.com/renewsblog/biggerpoc...

Although I'd love to invest close to home, I haven't seen many properties that meet my goals. I'd have to do FHA, and I'd feel over-leveraged at this price point.

I’m looking for advice, stories, tips, etc. on getting started in remote real estate, especially as a first time buyer.

Best, Will

@William Sullivan I am both an investor and a business developer for Real Property Management Indianapolis Metro. We have over 100 out of state and out of country investors purchasing buy/hold rental properties in Indianapolis because of the strong and growing economy mixed with reasonable pricing and strong ROI's. Most of my clients are in position to see an average over 5 years of 9%-12% ROI on cash flow and levered IRR's as high as 30% annually (this is bank financed homes with appreciation figured in with cash flows.)

Many of my clients are in other markets including, Cleveland, NW Indiana, Detroit (I know,) Memphis, and Kansas city. I've seen some people who like parts of Pennsylvania and Wisconsin as well. Every market has it's own nuances and building a solid team in your market is vital, but when it's done, it can really become a passive income machine over time.

I'd be happy to schedule a call with you to help you start exploring your options and help you start building a team. Just shoot me a PM.

@William Sullivan You won't be able to use FHA for a non-owner occupied property. And don't even think about trying to fool them. That's mortgage fraud, which is a felony.

That said, look in Norfolk, Bristol and Plymouth counties here in MA.  You'll find much more affordable prices here.

I have never done this but probably will have to do in future.
I wish you best of luck and take a look at this book:

Long-Distance Real Estate Investing: How to Buy, Rehab, and Manage Out-of-State Rental Properties

Well here's an old article but it gives the basics of investing remotely-

https://www.biggerpockets.com/renewsblog/2012/12/2...

The biggest thing is to know what end of the spectrum you're going in on... turnkey on one side all the way to full-out rehabbing on the other side, and everything in between.

Let me know if that article strikes up any questions or helps at all.

@Larry F. In your article you mention doing passive turnkey and crowdsourcing investing, can you please PM me these companies? Thanks!

Originally posted by @William Sullivan :

Hi BP Members!

I’m a first time buyer interested in making a remote investment. I live in the Boston, MA area, and I’m considering areas of the country with strong past performance:

https://www.biggerpockets.com/renewsblog/biggerpoc...

Although I'd love to invest close to home, I haven't seen many properties that meet my goals. I'd have to do FHA, and I'd feel over-leveraged at this price point.

I’m looking for advice, stories, tips, etc. on getting started in remote real estate, especially as a first time buyer.

Best, Will

Welcome to the site Will.

Below are some bullet point tips I like to give out to new investors looking to invest out of state. If you follow these points you will greatly reduce your risk of major loss.

  • Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
  • Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
  • Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
  • Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
  • Make sure your property manager is a licensed real estate brokerage.
  • Understand you can not eliminate all risk, only mitigate it. If you are risk adverse real estate, (especially out of state) is not for you.