Investing in other places
Member since 2023 · 95 posts · 28 votes
Investing in other places
Most Popular Reply
Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votesQuote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
You’re ALWAYS better off investing locally, where it’s easier to:
- Learn the market
- Network to find deals
- Network to find contractors
- Be more hands-on
- Driveby property to keep tabs on it
- Network to find a decent Property Management Company (PMC)
Next best location is somewhere else you lived, where you have an existing network of family & friends to help you as accomplish the above list as needed.
If you invest OOS, your biggest challenge won't be finding properties to meet your goals on paper, it’ll be successfully outsourcing all of the above.
The biggest mistake we see OOS investors making in our market, over and over again, is not fully understanding Neighborhood/Property/Tenant Classes and how they impact your probability of success!
They all run their ROI numbers assuming Class A results – when buying Class B, C & even D rentals.
Then they’re shocked when their performance expectations aren't met😞
If you choose to invest OOS, and have little to no landlord experience, we highly recommend targeting Class B Neighborhoods/Properties/Tenants. If you target Class C, you better be prepared emotionally & financially for plenty of challenges.
You can find Class B properties in the Midwest to BRRRR, but it will take more digging and YOU will need to understand how to analyze & identify them - because a lot of agents, wholesalers, PMCs, etc. will try to sell you Class C or D misrepresented as Class B:
- Many of them don't know/care what Class the properties are, so they're incompetent.
- Others know exactly what they are doing, so should be labeled as crooks!
EITHER WAY YOU LOSE!
Why is Property Class so important for investors to understand and apply in their investing strategies?
Because the Property Class dictates the Class of the tenant pool that the property will attract.
The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.
Both Property Class and Tenant Class will affect what type of contractors, handymen and property management companies you should target and be willing to deal with a property.
The Property Class will also impact the maintenance & renovations you do to, “Maintain to the Neighborhood”.
Why is that important?
Well, if you buy & renovate a property in Class D area to Class A standards, what Tenant Class will actually rent it?
Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?
So, if you fail to apply the correct assumptions to a property, your expectations won’t be met, and it may even be a financial disaster.
We use the following to rank Property Classes, in order of importance:
- Property Tenant Pool: closely linked to location, but not always.
- Property Location: closely linked to tenant pool, but not always.
- Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”
Key metrics for each Property Class:
Class A Properties:
Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
Tenant Default: 0-5% probability of eviction or early lease termination.
Section 8: Class A rents are too high and won’t be approved.
Vacancies: 5-10%, depending on market conditions.
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.
Class B Properties:
Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
Tenant Default: 5-10% probability of eviction or early lease termination.
Vacancies: 10-15%, depending on market conditions.
Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
Section 8: Class B rents are usually too high for the Section 8 program.
Class C Properties:
Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
Tenant Default: 10-20% probability of eviction or early lease termination.
Section 8: Class C rents usually meet program requirements, proper screening still recommended.
Vacancies: 10-20%, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.
Class D Properties:
Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
Tenant Default: 20-30% probability of eviction or early lease termination.
Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
Vacancies: 20%+, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.
Where did we get our FICO credit score information from?
Check out this chart:
|
FICO Score |
Pct of Population |
Default Probability |
|
800 or more |
13.00% |
1.00% |
|
750-799 |
27.00% |
1.00% |
|
700-749 |
18.00% |
4.40% |
|
650-699 |
15.00% |
8.90% |
|
600-649 |
12.00% |
15.80% |
|
550-599 |
8.00% |
22.50% |
|
500-549 |
5.00% |
28.40% |
|
Less than 499 |
2.00% |
41.00% |
Make sure you understand the Class of properties you are looking at and the corresponding results to expect.
Horror Stories from those that did NOT Understand What they were Buying:
https://www.biggerpockets.com/forums/48/topics/1137397-baltimore-a-path-to-never-ending-pain
https://www.biggerpockets.com/forums/432/topics/1231840-sell-at-a-loss-or-rent-at-a-loss
https://www.biggerpockets.com/forums/311/topics/840134-memphis-turnkey-tenant-turnover-costs
Logical Property Management4.9465 Reviews
30 Replies
- Hinton, WV · Member since 2026 · 31 posts · 10 votes7mo
?
The 1% rule in DFW is tough right now unless you’re buying off-market or doing value-add plays. Most of the cash flow investors I know here are either:
• Doing light rehab flips for shorter holds
• Targeting small multifamily with forced appreciation
• Or structuring creative deals (seller finance, sub-to, etc.)
Managing out of state works if you have strong property management, but it adds risk if you’re new.
What’s your primary goal right now — cash flow, equity growth, or short-term velocity?
- Member since 2023 · 95 posts · 28 votes7mo
@Terence Crawley it would probably be a place that has positive cash flow, then appreciation for growth over time. I know a management company would syphon cash flow doing it outta state, but I can't convince myself getting a property that's close to 300k that barely or doesn't cash flow. The most I can legverage from a bank is 25k. I don't mind taking risk but I need a bit of my own capital just to give me a bit of insurance
- MD/DC · Member since 2024 · 1k+ posts · 1k+ votes7mo
@Terence Crawley offered good options. It is hard when geographically challenged but I'd rather adapt to a market that is within driving distance and I know. There are so many singing the praises of out of state investing, mostly seems class C-D neighborhoods in the midwest and almost all are interested in getting your business. I'm sure it works out for some but I don't have the bandwidth for anything less than A with the occasional B.
- Member since 2023 · 95 posts · 28 votes7mo
@Jules Aton I would want a B-C range so you can force appreciate it. And I would have to try to study a market for some time if it was outta state because I wouldn't want a headache for some bs person just trying to make money and doesn't care about your interests
- MD/DC · Member since 2024 · 1k+ posts · 1k+ votes7mo
Quote from @Grayson Grzybowski:
@Jules Aton I would want a B-C range so you can force appreciate it. And I would have to try to study a market for some time if it was outta state because I wouldn't want a headache for some bs person just trying to make money and doesn't care about your interests
Smart to do your own due diligence. Gotta love “OOS is easy”. Lol in my experience no brick and mortar RE is easy or passive. I’d circle back to @Eric Gerakos advice. Buying the cheapest house on richest block or speculating on an upcoming area are solid strategies but don’t think you can force a B/C neighborhood to appreciate into A/B neighborhood or attract A/B tenants.
- Investor · Costa Mesa, CA · Member since 2016 · 1k+ posts · 1k+ votes7mo
There is a reason home prices are a fraction of where you are in some areas. Less desirability, less appreciation, and a poor tenant pool. Buy where people want to live.
- 7moSamuel DioufBusiness MemberReal Estate Agent · Columbus & Cleveland, OH · Member since 2023 · 1k+ posts · 1k+ votes
Hey Grayson, as long as you have everything structured properly you should be able to operate from out of state no problem.
I work with plenty of out-of-state investors who are seeing great success here in Ohio.
Read this article on the "core 4". It explains the team that you should develop to have a strong foundation under you while investing remotely.
https://www.biggerpockets.com/blog/core-four-real-estate-team
Reafco - Samuel Diouf528 Reviews - 7moDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
You’re ALWAYS better off investing locally, where it’s easier to:
- Learn the market
- Network to find deals
- Network to find contractors
- Be more hands-on
- Driveby property to keep tabs on it
- Network to find a decent Property Management Company (PMC)
Next best location is somewhere else you lived, where you have an existing network of family & friends to help you as accomplish the above list as needed.
If you invest OOS, your biggest challenge won't be finding properties to meet your goals on paper, it’ll be successfully outsourcing all of the above.
The biggest mistake we see OOS investors making in our market, over and over again, is not fully understanding Neighborhood/Property/Tenant Classes and how they impact your probability of success!
They all run their ROI numbers assuming Class A results – when buying Class B, C & even D rentals.
Then they’re shocked when their performance expectations aren't met😞
If you choose to invest OOS, and have little to no landlord experience, we highly recommend targeting Class B Neighborhoods/Properties/Tenants. If you target Class C, you better be prepared emotionally & financially for plenty of challenges.
You can find Class B properties in the Midwest to BRRRR, but it will take more digging and YOU will need to understand how to analyze & identify them - because a lot of agents, wholesalers, PMCs, etc. will try to sell you Class C or D misrepresented as Class B:
- Many of them don't know/care what Class the properties are, so they're incompetent.
- Others know exactly what they are doing, so should be labeled as crooks!
EITHER WAY YOU LOSE!
Why is Property Class so important for investors to understand and apply in their investing strategies?
Because the Property Class dictates the Class of the tenant pool that the property will attract.
The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.
Both Property Class and Tenant Class will affect what type of contractors, handymen and property management companies you should target and be willing to deal with a property.
The Property Class will also impact the maintenance & renovations you do to, “Maintain to the Neighborhood”.
Why is that important?
Well, if you buy & renovate a property in Class D area to Class A standards, what Tenant Class will actually rent it?
Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?
So, if you fail to apply the correct assumptions to a property, your expectations won’t be met, and it may even be a financial disaster.
We use the following to rank Property Classes, in order of importance:
- Property Tenant Pool: closely linked to location, but not always.
- Property Location: closely linked to tenant pool, but not always.
- Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”
Key metrics for each Property Class:
Class A Properties:
Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
Tenant Default: 0-5% probability of eviction or early lease termination.
Section 8: Class A rents are too high and won’t be approved.
Vacancies: 5-10%, depending on market conditions.
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Class B Properties:
Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
Tenant Default: 5-10% probability of eviction or early lease termination.
Vacancies: 10-15%, depending on market conditions.
Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
Section 8: Class B rents are usually too high for the Section 8 program.Class C Properties:
Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
Tenant Default: 10-20% probability of eviction or early lease termination.
Section 8: Class C rents usually meet program requirements, proper screening still recommended.
Vacancies: 10-20%, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.
Class D Properties:
Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
Tenant Default: 20-30% probability of eviction or early lease termination.
Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
Vacancies: 20%+, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.
Where did we get our FICO credit score information from?
Check out this chart:
FICO Score
Pct of Population
Default Probability
800 or more
13.00%
1.00%
750-799
27.00%
1.00%
700-749
18.00%
4.40%
650-699
15.00%
8.90%
600-649
12.00%
15.80%
550-599
8.00%
22.50%
500-549
5.00%
28.40%
Less than 499
2.00%
41.00%
Make sure you understand the Class of properties you are looking at and the corresponding results to expect.
Horror Stories from those that did NOT Understand What they were Buying:
https://www.biggerpockets.com/forums/48/topics/1137397-baltimore-a-path-to-never-ending-pain
https://www.biggerpockets.com/forums/432/topics/1231840-sell-at-a-loss-or-rent-at-a-loss
https://www.biggerpockets.com/forums/311/topics/840134-memphis-turnkey-tenant-turnover-costs
Logical Property Management4.9465 Reviews- Member since 2023 · 95 posts · 28 votes7mo
@Drew Sygit thank you so much for taking the time to post this. It was very insightful. I am familiar with the classes, care enough what to look for and know "location location location" is crucial. I'm an engineer so I analyze the crap outta stuff. I just want my foot in the door and get going so I can start scaling and try getting to financial freedom.
- 7moJuan YepesBusiness MemberLender · Miami, FL · Member since 2025 · 127 posts · 36 votes
Texas is still a great area for real estate investments but you need to find up and coming areas. This way you can invest in other places that are still a long car ride away.
If you feel comfortable investing out of state, Florida and Georgia are great option. Just like Texas, there are major cities where price might not work right now. The value is in finding the surrounding up-and-coming areas.
You can always hire a management company to take care of the property. This is a good idea even if you are investing locally. Just make sure to include this cost when you are modeling your deals.
Helm Mortgage Corp - Juan Yepes, Director5126 Reviews - 7moAlfath AhmedBusiness MemberReal Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
Yeah TX has had recent surges in higher taxes so too many people aren't investing there anymore. Investing OOS is easy as long as you have a good team.
I think the midwest is great since taxes are controlled, state is landlord friendly, and a ton of opportunity.
ReafCo | Ahmed Group 533 Reviews - Real Estate Agent · Columbus, OH · Member since 2018 · 1k+ posts · 1k+ votes7moHi Grayson, you may want to take a look at Columbus, Ohio. I’ve been investing here since 2019. It’s a strong market, particularly for out-of-state investors. It's a market with favorable rent-to-price ratios, and there are still pockets that cash flow. Ohio is also considered landlord-friendly, which helps from an operational standpoint. Out-of-state investing can absolutely work, but in my experience, it depends on building a trusted local team you can rely on, which helps take much of the burden and stress off your shoulders.
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
- 7moMike PaolucciBusiness MemberRealtor · Columbus Cleveland Dayton, OH · Member since 2022 · 501 posts · 553 votes
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
Hey @Grayson Grzybowski. Ran into that same issue back in 2021 when I first got started while living in Northern CA. I ultimately went out of state because it made more sense. In Ohio, you at least have actual landlord laws rights that make your life a lot easier.
I know it might be hard to find some deals out there but it's always more advisable to invest locally rather than out of state. A lot safer and easier for you to manage the property however you see fit.
If you go out of state, I'd higly recommend hiring a PM with a good reputation in the area to help you manage your day to day operations. It'll take a lot of the burden off you and stress of having to trust contractors or anyone else. They'll have contractors that they trust and work pretty heavily with and will hold them accountable for you.
That doesn't mean it's a set it and forget it thing though. You'll still need to monitor, manage and review your PM's moves but at least you'll have someone local who you can rely on.
Reafco - Mike Paolucci 512 Reviews - 7moElise Bickel TauberBusiness MemberReal Estate Agent · Cranberry Twp · Member since 2017 · 385 posts · 198 votes
Hi Grayson! Shouting out from Pittsburgh PA which I believe is one of the best LTR and flip markets out there! Lots of great potential for cash flow on LTR with low entry point of purchase. I know the concern with out of state investing is the management side of it. Of course you can hire a PM company which I always encourage for my out of state clients but if you decide to self-manage, partner with a local agent or PM company to help you with things like renting the units, evictions, etc. We work with a lot of clients who self manage and only call us if they need a unit leased or shown or if maybe they need a 10 day notice posted, eviction filed, etc. Having a local resource to even just bounce questions off of is a plus. If you need any help at all or decide to check out the Pittsburgh market let me know!
- Inland Empire, CA · Member since 2017 · 151 posts · 79 votes7mo
Hey@Grayson Grzybowski most deals don’t pencil right now, at least not at what many sellers are still asking. That said, I have been seeing seller expectations start to come down in a lot of markets. We actually just closed on a 121 unit Class C property in Fort Worth, and while it was off market, it shows deals are still getting done. They’re just harder to find and usually require a bit more patience and discipline than they did a few years ago.
- Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes7mo
Your home field advantage is worth at least 20%. That's the premium I would expect to spend in FW if I would invest there remote from Milwaukee in comparison what you would spend. My knowledge gap and the fact that I have to pay someone for everything and make judgment calls on my behalf, the fact that some contractors will charge me a little more and because I am not there to supervise the quality of work will be lower.
And I think FW is actually cheaper than Milwaukee!
- 7moRodney MenendezPro MemberDeveloper · South West Florida · Member since 2020 · 74 posts · 53 votes
A lot of investors eventually reach this point when their local market stops making sense from a numbers perspective.
One strategy that’s becoming more common is Build-to-Rent duplexes instead of buying existing properties. Rather than competing for older inventory and dealing with rehab surprises, some investors purchase land and build duplexes designed specifically for long-term rentals.
Duplexes can work well for this because you’re generating two rental units on one lot, which can improve the overall return profile compared to single-family rentals.
Another structure I see investors using is “ready-to-build” projects where the lot, plans, and construction scope are already defined. That can remove a lot of the early-stage risk since you’re not spending months figuring out zoning, design, and contractors before construction even starts.
For example, there are pre-construction duplex projects in Cape Coral where the total land + build cost is around the mid-$400k range for a 3/2 per side duplex (~2,400 sq ft total) valued in the mid-$500k. For some investors that’s attractive because they can start with a new property rather than inheriting deferred maintenance from older homes.
From what I’ve seen, the biggest keys when investing remotely are:
• Conservative underwriting (insurance/taxes especially in FL)
• A reliable property manager lined up early
• A builder/GC familiar with investor projects and timelinesOnce those pieces are in place, investing outside your home market becomes much more manageable.
Curious — are you mainly targeting cash-flow properties or long-term appreciation plays?
- 7moMichael McVetyBusiness MemberFort Myers, FL · Member since 2024 · 46 posts · 20 votesHi Rodney and a thoughtful post.
Quote from @Rodney Menendez:
A lot of investors eventually reach this point when their local market stops making sense from a numbers perspective.
One strategy that’s becoming more common is Build-to-Rent duplexes instead of buying existing properties. Rather than competing for older inventory and dealing with rehab surprises, some investors purchase land and build duplexes designed specifically for long-term rentals.
Duplexes can work well for this because you’re generating two rental units on one lot, which can improve the overall return profile compared to single-family rentals.
Another structure I see investors using is “ready-to-build” projects where the lot, plans, and construction scope are already defined. That can remove a lot of the early-stage risk since you’re not spending months figuring out zoning, design, and contractors before construction even starts.
For example, there are pre-construction duplex projects in Cape Coral where the total land + build cost is around the mid-$400k range for a 3/2 per side duplex (~2,400 sq ft total) valued in the mid-$500k. For some investors that’s attractive because they can start with a new property rather than inheriting deferred maintenance from older homes.
From what I’ve seen, the biggest keys when investing remotely are:
• Conservative underwriting (insurance/taxes especially in FL)
• A reliable property manager lined up early
• A builder/GC familiar with investor projects and timelinesOnce those pieces are in place, investing outside your home market becomes much more manageable.
Curious — are you mainly targeting cash-flow properties or long-term appreciation plays?
When I am speaking with investors in Cape Coral and Fort Myers, I explain that while the real estate prices going down make for a better purchase price, just understand that the rents are down as well and will come back in a few years.
I believe most people are looking at the appreciation aspect and then will see a better cash flow later.
Red Fortress Property Management Co.4.2331 Reviews
- 7moArman AhmedPro MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 961 votes
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
Totally get it, a lot of investors in Dallas and Fort Worth are feeling the same squeeze right now since prices ran up and the 1% rule basically disappeared. That’s exactly why many of us shifted to the Midwest, where numbers still make sense. Cities in the Midwest still have affordable duplexes and small multis that cash flow day one, and if you build a solid boots-on-the-ground team with a local PM, contractor, and lender, remote investing honestly feels pretty hands-off. The key is treating it like a business and having people you trust locally, then distance stops being a headache and just becomes a numbers advantage.
- 7moMarc RiceBusiness MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
Yes it could be hectic. But with the correct connections, you will find it easier. What markets are you thinking about? Probably the midwest markets are the best option for you
Marc Rice | Investor Friendly Agent at Reafco Tailwind Team574 Reviews- Member since 2023 · 95 posts · 28 votes7mo
@Marc Rice right now I'm just shopping around to see what I think would be best. Running to the places everyone else is going won't help me with my little experience
- Real Estate Broker · Kansas City Metro · Member since 2015 · 2k+ posts · 1k+ votes7mo
Kansas City is a great market.
- 5moLindsay DavisBusiness MemberReal Estate Broker · Birmingham, AL · Member since 2019 · 327 posts · 203 votes
@Marcus Auerbachmakes a pretty underrated point here. You have a real advantage investing in markets that you’re familiar with. It may be difficult to find a good deal in the DFW area, but if you’re patient enough (and fast enough when they hit the market), there are good deals to be found in any market.
In my opinion, the best way to beat analysis paralysis is just to start. Find a trusted turnkey provider or a property manager partner, start looking for deals, and be ready to close when the right one pops up.
Spartan Invest4.8133 Reviews- Member since 2023 · 95 posts · 28 votes5mo
@Lindsay Davis thanks for the advice
- 4moKyle MccawBusiness MemberProperty Manager · Keller, TX · Member since 2011 · 1k+ posts · 1k+ votes
I’ve found you usually have to go a little farther out from DFW to find deals that approach the 1% rule.
The tradeoff is that those markets often have smaller populations, which can mean longer lease-up times and fewer qualified tenants. A property that cash flows better on paper can quickly lose that advantage if it sits vacant for 60+ days between tenants.
I'd focus on overall return, not just the 1% rule. Strong rental demand and shorter vacancies can be worth a lot.
McCaw Property Management4.4909 Reviews- Member since 2023 · 95 posts · 28 votes4mo
Quote from @Kyle Mccaw:
I’ve found you usually have to go a little farther out from DFW to find deals that approach the 1% rule.
The tradeoff is that those markets often have smaller populations, which can mean longer lease-up times and fewer qualified tenants. A property that cash flows better on paper can quickly lose that advantage if it sits vacant for 60+ days between tenants.
I'd focus on overall return, not just the 1% rule. Strong rental demand and shorter vacancies can be worth a lot.
Thank you for this. Yes I am aware of having to go outside of the most centralized area for good investment. I do have an edge because I am a civil engineer who designs and develops things.. SO I can see where things are moving
Hey Grayson! That’s exactly why a lot of investors eventually go out of state. Even myself as an agent, I also tend to find myself explore opportunities elsewhere. The 1% rule is tough to find in many major markets now.
In my experience, remote investing works if you build a strong local team first—especially a property manager and contractor. The market matters, but the team matters more.
Are you mainly looking for cash flow, appreciation, or a mix of both?
- 4moJimmy LieuBusiness MemberReal Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votesWelcome back to BP, Grayson. You're definitely not alone in feeling that way. A lot of investors in higher-priced markets have been facing the same challenge of trying to balance cash flow with appreciation potential. Long-distance investing can absolutely work, but the key is building a strong local team before you buy. A good property manager, contractor, lender, and a few trusted boots-on-the-ground contacts can make an out-of-state property feel much less "far away." I think one of the biggest mistakes newer long-distance investors make is focusing only on the numbers and not spending enough time vetting the people they'll rely on. If you're finding that deals in DFW no longer meet your goals, it may be worth expanding your search and comparing multiple markets based on job growth, population trends, landlord laws, and rent-to-price ratios. The 1% rule is harder to find today than it was a few years ago, but there are still markets where investors are finding solid cash flow if they're patient and willing to look beyond their backyard. The good news is that technology, property management, and access to data have made long-distance investing much easier than it was even 10 years ago.
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
Jimmy Lieu, Red 1 Realty4.9121 Reviews - 3moRobert EllisBusiness MemberDeveloper · Miami, FL · Member since 2014 · 3k+ posts · 1k+ votes
Quote from @Grayson Grzybowski:
Hey all to who reads this. I have been a pro member on and off over the years and I'm hoping someone can give me some pointers. I'm currently in the dfw texas area. After Covid this area spiked in home pricing and now even reaching the 1% rule is practically impossible. I listen to people investing in other places where home prices are a fraction of what they are here. But the con of managing something afar seems like it has a bunch of complications as well. Thanks
The thing that changed my thinking was realizing I didn't need to solve scaling before I owned anything.
I spent a lot of time trying to find the perfect market, the perfect strategy, and the perfect first deal. What happened was I got really good at comparing opportunities and not much better at owning property.
The first property taught me things I never would have learned from analyzing markets. The first turnover. The first contractor issue. The first repair that cost twice what I expected.
None of those problems were big enough to hurt me, but they completely changed how I looked at the next deal.
When you say you want your foot in the door, what's actually stopping you from buying the first one today—finding a deal you trust or pulling the trigger once you find it?
Section 8 Launch52 Reviews - Wholesaler · Member since 2026 · 15 posts · 4 votes3mo
Out of state is very doable with the right team on the ground. GA, FL, TX have been our focus — key is having a contractor or agent in each market who actually has eyes on inventory. Remote investing is a systems game more than anything.
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