Investor · NC · Member since 2020 · 30 posts · 30 votes
I live in San Francisco and wanting to invest in a multi family home in another state since everything in California is too expensive. What are some good states to look into? Also what is the best tips for someone starting in real estate investing?
Investor · Omaha, NE · Member since 2019 · 130 posts · 139 votes
6y
@Arun Dharan Educate yourself as much as you can on long distance real estate investing through books, podcasts, BP, Youtube, blogs, etc. There is so much information out there to learn what to do and not to do. Start looking into an area that you have some ties to and would not mind checking in on as this is your first venture into real estate investing it is beneficial to meet with some contacts such as agents, inspectors, property managers, etc.
One of the most important aspects of long distance investing is having systems in place and having people to manage those systems. It takes time to build this. If you know someone that is in a more affordable market that has experience and may be interested in partnering with you that could be an option as well. Remember the importance of having reserves in place when investing in real estate and including 10-20% monthly expense for maintenance/CAPEX.
Firstly identify what strategy, returns, and type of investment you are looking for.
Jumping into a long distance multi family investment as your first real estate investment is not something that I would strongly suggest, but that being said it can be done. Start targeting a few areas that you may be interested in and start calling agents and explain to them what you are looking for and see what is out there. Think about who is going to manage the property and ask questions of property management companies such as what their processes are, fees, general vacancy rates, other properties they manage so you can get references, etc. Also start talking to lenders in the area so you know what you are approved for in terms of financing before potentially finding a deal. Best wishes!
Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
6y
@Arun Dharan Get preapproved with a lender first.........otherwise when you start reaching out to agents and PMs you won't be taken to seriously if you haven't taken this basic step. Plenty of lenders here on BP and I also know of one that will lend in every single one of the markets mentioned on this thread for properties as low as $40K.
Caveat #1 If it's your first property I do NOT recommend you start out with a $40K Property.
Caveat #2 If you do decide to invest in Cleveland, let me know, I have some contacts there and I can let you know what agents and PMs to look at and equally important who to stay away from
Caveat #3 Be prepared. When you tell them you are in San Francisco you might end up communicating with some people that will think, "Ooh, California Investor (with money)....let's tell him about the $150,000 House that generates $775.00/mo in gross rents in a "B or C" neighborhood"
Most people here on BP mean well and are good, actually very good at what they do and I've learned a lot on here and am still learning. Just don't fall for the first agent or PM you hear from or the first deal that you hear about.