INVESTING OUT OF STATE

5 Replies

I live in Utah and real estate is starting to boom here. As I run the numbers, it is difficult to find cash flowing properties that are less than $250,000. I have heard of friends investing in out of state properties that are cash flowing and utilizing property management companies to handle. Do any of you have recommendations for specific states to invest in? Are you currently doing this? I don't want to re-invent the wheel and would love some direction from someone currently doing this. What works for you? Which states are you investing in?

Hi @Jacob Reese , I feel you brother!  I have tried to invest in the SLC market for the past 2 years and it is en fuego!

In general you'll do well to look for good linear real estate markets (staying away from cyclical markets, which we hear so much about in terms of appreciation). If you can find one with a good bit of diversification from your home market, that's an added plus, too.

There are some strengths to be touted in different areas across the country, but I'd start with this:  what would be true of your investments overall in the next 5-10 years?  How about 20 years?

Start there and then back-calculate to find an optimal market for that.

Hi, Jacob! Deciding on which market you are investing in will definitely depend on what type of return you are looking to get and what strategy you are going to employ. You have to look at the overall economy of the area you are planning to invest in. In my case, we decided to move to Charlotte a year and a half ago, because it is more family-oriented, the average age in Charlotte is 35, and we thought this was a better fit for our children. We were leaving in Southwest Florida, but we have two adopted children who both have special needs that are better met in Charlotte. But when we decided to move, it was also a business decision. I chose Charlotte because there is a lot of industry, which means a lot of jobs, while Florida is a retirement area. I also look at transportation, how well the roads were laid out, and what projects they had for improving public transportation. The other criterion I took into consideration was the affordable housing in and around the area and the number of permits that have been pulled for new constructions and development orders. These are all important criteria to establish a strategy when investing in real estate. Plus, when deciding on a new market, I look at developments over the last three years in that market. I look to see what the current average days on the market are and how many months of inventory, and I segment this by single-family and multi-family and location. Then I also look at pricing fluctuations and the average wage. I would say that you should first of all do your research on your prospective markets and see if that market is a fit for you.