My wife and I live in Northern California and thus far have compiled four doors by buying, moving and then renting. This works and is cash flow positive, especially as we both work full time jobs, plus a couple side gigs. However, given prices in Northern California, it’s difficult to amass greater cash flow and get right into rental/investment properties. With that said, there are opportunities in other states, but am wondering the best resources or points of contact to investigate, research and knowledgeably starting a more in-depth out of state real estate investing venture. Side note, I’m just anxious to slowly stop working my regular gig and find more passive income, which is why out current strategy, while good, is and will take too long.
I suggest looking into turn-key rentals and buying them based on current rental income, not potential future income.
@Justin Hazel congratulations on achieving four doors! It's definitely not easy in California and you are exactly right, in order to achieve cash flow an investor typically has to do this out of state.
You'll learn through all of the future podcasts that you'll listen to from @David Greene and @Brandon Turner that you'll need a strong team on the ground to achieve financial freedom. It starts with having a quality real estate agent, a quality property manager and a quality contractor.
Once you have these in place it is much easier to invest out of state. Take the time to listen to the podcasts and read a few of the books written by David and Brandon and you'll do well going forward.
I agree with @Anthony Dooley . Turnkey isn't for everyone but if you are seeking a more passive approach to real estate investing, it's definitely work looking into.
I'm active in Kansas City and would be happy to answer any of your questions.
@Justin Hazel Out of state investing has some unique challenges but it doesn't have to be as difficult as some people make it sound. Most of the problems that you might have can happen even if investing in your local market. You can have a bad tenant anywhere. Things break and have to be replaced regardless of where the house is. Fortunately, these things can be fixed and you move on. What can't be fixed is buying in the wrong neighborhood which is a challenge for out of state investors that don't know the area. It's critical to buy the right asset class for you market. You need to either spend some time on the ground in your market of choice or work with highly trusted people on the ground.
Do you want properties out-of-state that you'd be fixing up or do you prefer more turnkey/rent-ready?
@Justin Hazel I agree with @Ali Boone - you need to start with the end in mind and your risk/reward balance. There are a lot of locals here that can help, and i am willing to make some introductions for you once we know what type of asset you're looking to acquire. I work on the commercial and multifamily side but have a ton of connections on the SFR side as well.
Keep studying the matter and come up with your profile for vetting other markets. Population, crime, job growth, employers, median cost, property size - under 5 units or 5+. Learning this will help you project where the local economy is going and whether the area would be good to invest in.
Study the ins and outs of finding and managing a good property manager
Find a good lender licensed in that state
Go visit and find a kick a** agent who knows what's happening on the ground
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