Rehabbing long distance?

Question

I’m looking into investing out of state (I live in California). My goal is to BRRRR (just learned that acronym) but I suppose the “renovation” part would be minimal —cosmetic— since I feel like I would not have good control over that if operating on the opposite end of the country. Has anyone been successful in renovating long distance?

Evan Hopple · Answer

@Lisa Hartzleaning toward a cosmetic rehab is the right way to go on your first out of state deal. Much like a rehab to a property down the road from you, the key is doing your own due diligence up front

Laura Williams · Answer

I would add when you are vetting a potential contractor to use it’s helpful if the person recommending them has used them for a long time and has seen their work hold up over time. I’ve seen so many contractors that can come across as rockstars and people love them until a couple years down the road when their work starts falling apart cause they took short cuts or didn’t know what they were doing. Such as tiling over a rotten subfloor or replacing windows on wood frames that have wood rot kind of stuff…where at first the rehab appears great until it isn’t. Unfortunately this profession gets a bad rap for a reason so it won’t hurt you to learn as much as you can about the process. So for example when you retile a bathroom you can make sure to insist the 50 year old plumbing behind the walls (getting the tile over it) gets replaced same time using a professional plumber and not a handyman who doesn’t know what he’s doing where you get leaks later kind of thing. I’ve seen people do well buying and rehabbing but just proceed with caution and leave a lot extra on your budget for overages.

Timothy Howdeshell · Answer

@Lisa Hartz Hey Lisa. I'm with you! I live over in Fresno and even in the Central Valley, the numbers don't make a lot of sense to me here locally. There are those that do invest in CA, but I'm not too sure how. Part of the issue for me is that I fix and hold, not flip. I also like to underwrite as a rental for a fall back plan just in case. Price to rent ratios don't seem to support investing locally. Anyways....

Yes, you can definitely do this, although it is more difficult that doing the work locally. I do this in Kansas City myself. It all comes down to the team and building out those relationships with people local to your chosen market.

Happy to help where I can. Feel free to PM me.

Eliott Elias · Answer

Rehabbing a property long distance is a nightmare. Rehabbing a property in your backyard is even a nightmare. Vet your contractor like no one’s business. They will make or break your business.

Michael Dumler · Answer

@Lisa Hartz, connect with an investor-focused agent first. Once you do that, the rest of your team should come together. That being said, perform your due diligence and interview all vendors before proceeding to work with them. If you're interested in the Atlanta market, I'd be happy to connect.

Travis Biziorek · Answer

Hey Lisa, I'm also in CA but invest in Detroit and do plenty of BRRRR's there.

They key is to have a strong team on the ground.

You can either do that by building one yourself or plugging into an existing team.

But yes, it's very doable.

Dan Krupa · Answer

@Lisa Hartz @Timothy Howdeshell is spot on. I lived in KCMO for four years and then moved to Phoenix. Everything we do investing-wise is still there. We do property management, renovations, sales, etc... If you have the right team, the numbers are unbeatable vs. here or Cali. But again, you need someone on the ground with experience who has done this a lot and understands your strategy.

V.G Jason · Answer

You need two-three really good options, and a well-rounded team. You also need them to sign the documentation that holds them accountable. Basically, what they agreed to but in writing with documentation that's acceptable to you and with lien waivers.  If you're doing cosmetic to re-fi it'll be useless. Do cosmetic to boost rents, then sure.

Nicholas L. · Answer

@Lisa Hartz

a 'cosmetic' rehab probably won't be enough to be a good BRRRR because you won't be able to boost the ARV enough to make it worth it.

and like @Eliott Elias said, i have a hard enough time managing my rehabs that are close to me.  i don't even know how i'd do one out of state.  i'd have to have a team... but i'd have to have set up that team in person.  as far as i can tell the position of "managing the rehab the way you would want if you were doing it yourself, and putting your best interests first" doesn't exist.

is there a market in CA or NV that you can drive to, or get to, 2-4 hours away, with a price point where you feel comfortable?  OOS BRRRR is just a really tough way to start, especially with interest rates where they are and still with strong investor competition for deals in just about every market.

Lisa H. · Answer

Thanks! I DM you

Rehabbing long distance?

Most Popular Reply