Out of state real estate investments

Rental Property Investor · Los Angeles, CA · Member since 2020 · 12 posts · 3 votes

Important factors as a first time out-of-state real estate investor ? I live in California and interested in out of state real estate specifically in Memphis Tennessee and Indianapolis Indiana. What are somethings that i should be aware of before going in and investing ?

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Nick GiulioniPro Member

Rental Property Investor · Carmel, IN · Member since 2016 · 1k+ posts · 615 votes

Hey - that's a super broad topic. David Greene has written a whole book on this.

Highly recommend checking that out.

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Nick GiulioniPro Member
Rental Property Investor · Carmel, IN · Member since 2016 · 1k+ posts · 615 votes
6y
Hey - that's a super broad topic. David Greene has written a whole book on this.
Highly recommend checking that out.
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Daniel McNulty
Financial Advisor · Indianapolis, IN · Member since 2018 · 294 posts · 165 votes
6y
@Karo Darmandzhyan

David Greene's book pretty much covers all operational aspects. I would also encourage you to join / follow the relevant forum threads for those cities. You will be able to network and stay in tune with location specific people and happenings.

Good Luck!

Danny McNulty

Financial Advisor
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Jonathan GreeneBusiness Member
Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
6y
Read the book as others mentioned and listen to the recent BP podcast episode with @Lee Ripma. She is in LA and investing in KC and there are some great what not to do lessons in there. Basically your most important factors are team and coverage and relationships. You want to go to your markets and meet people face to face and vet them through other people on BP. You can't trust anyone to help you across the board out of state, you have to have very strong oversight and know how to hold people accountable from afar with video updates and workflow requirements.
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Mike Mocek
Property Manager / Licensed Realtor · Toledo/Columbus, OH · Member since 2019 · 244 posts · 262 votes
6y
Originally posted by @Karo Darmandzhyan:
Important factors as a first time out-of-state real estate investor ? I live in California and interested in out of state real estate specifically in Memphis Tennessee and Indianapolis Indiana. What are somethings that i should be aware of before going in and investing ?

Hello There! I always recommend doing research before diving in to an unknown area. Otherwise, it will be like going to France and not being able to speak the language. Investing is supposed to be interesting, challenging and above all cash flowing otherwise, no one would do it.

I find travelling to the area and just driving around, scoping out the neighborhoods. Find a Realtor/Property Manager who is willing to travel during the day with you to show you ALL of the neighborhoods. I am a Realtor and Property Manager here in Toledo, when someone is interested in coming to my city, I take the day to show them every neighborhood. I want investors to see ALL of the possibilities, whether it is good, bad or ugly. That way, there is a base knowledge of the area.

It is also extremely important to know what kind of town you are investing in. Is it a College town, Medical Town, IT Town etc. That will also help you understand what kind of tenants you will be getting. For Example: Detroit is Automotive, so you know how that city drives. Toledo is a medical town so here, you are going to get a good mix of medical professionals, we also have the Jeep and Glass factories, so that is a basic of tenant as well. Obviously, this is not a 100% making however, it is nice to know exactly what you are getting into. Florida is another one, if you are on the beach, AirBNB would be more cash flowing than a routine tenant. Whereas here in Toledo, AirBNB is not a huge make-up of the area (Unless you are by the universities.

I find that, if the investors that go to a city to invest in, it is EXTREMELY important to network with individuals in that town. Realtors, Property Management, Contractors etc. You may not utilize them for services however, locals have the broaden knowledge of the area. I hope this helps, please PM me if there is anything else I can assist with!

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Karo Darmandzhyan
OP
Rental Property Investor · Los Angeles, CA · Member since 2020 · 12 posts · 3 votes
6y
@Nick Giulioni thank you Nick , I just purchased the book and watched a few of David’s podcasts it was very beneficial .
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Karo Darmandzhyan
OP
Rental Property Investor · Los Angeles, CA · Member since 2020 · 12 posts · 3 votes
6y
@Daniel McNulty Thanks Daniel , I will get to reading that book ASAP , And for sure get more involved in the forums seems like there are a lot of knowledgeable people in BP.
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Karo Darmandzhyan
OP
Rental Property Investor · Los Angeles, CA · Member since 2020 · 12 posts · 3 votes
6y
@Jonathan Greene Thank you Jonathan, yes the more I read and listen the more I realize how valuable a team is In long distance or a “ core four” looks like I have to learn a bit more before I can hop right in into long distance investing . Appreciate the advice !
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Karo Darmandzhyan
OP
Rental Property Investor · Los Angeles, CA · Member since 2020 · 12 posts · 3 votes
6y
@Mike Mocek Hey Mike , I will for sure get to know the markets I’m interested in a lot better , and try getting contact with people that can help me scope the cities . Thanks a lot for the advice and would love to ask some questions as I get a better understanding of real estate investing.
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Nick GiulioniPro Member
Rental Property Investor · Carmel, IN · Member since 2016 · 1k+ posts · 615 votes
6y
Originally posted by @Karo Darmandzhyan:
@Nick Giulioni thank you Nick , I just purchased the book and watched a few of David’s podcasts it was very beneficial .

He’s one of the best there is. Great starting point.
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Mike D'ArrigoPro Member
Turn key provider · San Jose, CA · Member since 2010 · 4k+ posts · 3k+ votes
6y
@Karo Darmandzhyan the most important thing with investing out of state is knowing the neighborhood. This is particularly true in Indianapolis which can vary neighborhood to neighborhood and even street to street. Don't make the mistake of buying cheap properties just because they look good on paper. They don't pan out. We've been active in Indy for 10 years and know it well. I'd be happy to help if I can.
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