Studying a market when you don't live near the area

Investor · Lithonia, GA · Member since 2012 · 231 posts · 43 votes

Hey BP fam, I'm going to buy a house in the Atlanta area but I am currently in Philadelphia. Anyone have suggestions on how to study a market when you are a little more than a couple of states away from the market you want to invest in? I know its important to do your homework but how do you conduct the research when you are so far away? Thanks in advance, Chudi

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Haim Mamane Palman

Investor · San Francisco, CA · Member since 2013 · 147 posts · 97 votes

13y

I live in CA and invest in Memphis, TN. From my experience, talking to property managers and real estate agents that have experience working investors was very helpful for me. Another way is to look where the turn-key companies buy and research this area.

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Joseph M.
Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
13y
Nowadays were are lucky to have various tools available , making it a lot easier to study markets via the Internet. Since you are looking at Atlanta one good tool might be Redfin , it is very close to what you might find on the mls, sale prices are actual sale prices and they don't throw out estimates like Zillow does . They are in several markets now and seem to be expanding. Census data can be helpful too . Usually if you google census and the zip code or demographics and the zip code you will get links to this info Many counties also allow you to research property sales on their websites too I find yelp to be pretty helpful as well you can put in a property address and get a list of nearby businesses . Can give you an idea of the area . I find google news to be a good tool too you can search for articles about the area and find out about new developments . Along with that the county or city government websites might give you insight into developments that are occurring , etc Citydata forums is also another great tool you can ask questions about an area and get answers from people that live in the city . Good luck
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Tom Goans
Real Estate Investor · Englewood, CO · Member since 2013 · 988 posts · 258 votes
13y
@Chukwudi Motanya,

Would you buy a $50,000 automobile without first physically seeing the auto?

Internet information is not accurate. Every property is unique with its own unique problems and assets. Every target market is unique.

History is not reliable predictor of the future. For example, when a military base closes, just to give one example.

My methods may be too thorough for some, but they have never failed me.
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J ScottPro Member
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Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
13y
When I consider a new market, I spend a couple weeks there learning the ins and outs, and also make sure that I have MLS access in order to see the important data for myself. I couldn't imagine doing anything less...
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Stephen Masek
Investor · Mission Viejo, CA · Member since 2012 · 627 posts · 204 votes
13y
The Internet is very helpful. Trulia and Zillow help you look at schools and other houses nearby. Realtor list sites are a mix, as some have old listings, or short sales not called out as such. Bing and Google provide aerial photos to see the houses, and examine the neighbor characteristics. Local property managers are helpful, especially in knowing areas to avoid. Air travel is generally not expensive, so going to an area is helpful to assess commuting issues, neighborhoods, and see particular houses. We went to Atlanta last year, and being there definitely helped us understand the commuting issues, so we got two nice ones in locations good for commuting - one in Acworth, and one in Lawrenceville. . We've bought half our properties without going to see them, and am in escrow now on two such properties, one in Memphis and one in Indianapolis. We got two excellent houses in Austin in May, and the trip there was certainly worthwhile.
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Curt DavisBusiness Member
Flipper/Rehabber · Memphis, TN · Member since 2008 · 5k+ posts · 2k+ votes
13y
Every investor has their own comfort level. @J Scott I am curious on how you are able to get actual MLS access in every market when it is normally only for RE agents.

@Stephen Masek let me know if I can ever be of any assistance. I am a licensed realtor and full time wholesaler here in Memphis.
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Haim Mamane Palman
Investor · San Francisco, CA · Member since 2013 · 147 posts · 97 votes
13y
I live in CA and invest in Memphis, TN. From my experience, talking to property managers and real estate agents that have experience working investors was very helpful for me. Another way is to look where the turn-key companies buy and research this area.
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Mike McKinzie
Investor · Westminster, CO · Member since 2009 · 1k+ posts · 1k+ votes
13y
[quote=Tom] Would you buy a $50,000 automobile without first physically seeing the auto? [quote]

The answer is YES, and it was actually over $60,000.00, and I just did it in April.

The idea that you need to actually see a house before you buy it is akin to saying you need to see a Factory before you buy stock in a company. I have not seen the last 15 houses I have bought, nor have I even set foot in the town or STATE they are in. And I retired three years ago, at age 50, because of it.

For me, it is BETTER to not see a house and to let actual experts do the judging for you. Getting an appraisal, Professional Home Inspection and a couple of Broker's opinions is all you need. When you actually see a house, you risk getting your emotions involved in the process and that is NEVER a good thing. I am not buying something to hang on the wall or something to show to my friends, I am buying CASH FLOW.

And while the internet has some incorrect information, it has a lot of accurate information such as school districts and ratings, work centers, shopping centers and other raw data that help with the decision.

So don't let out of area properties bring fear into your decision making.
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Chris ClothierBusiness Member
Rental Property Investor · memphis, TN · Member since 2009 · 2k+ posts · 3k+ votes
13y
@Chukwudi Motanya - the one thing I would not do is put any stock into what you read or see on Trulia or Zillow. Neither is reliable nor can they be any more current that the information that is inputed. I helped a client this past week who had a question as to why her property showed it was worth much less than the $90k she had paid. The comps around her were listed all over the board, but all were bear her buy price and higher than the value they assigned to her property.. It took me all of 2 minutes to pinpoint a house within 500 yards listed as a 3br/2bath house at roughly 1500 sq. ft. and valued in the $90k range...and it is non-exisent. Scraped off the lot after a fire. The picture on zillow SHOWED a vacant lot. The detail showed a vacant lot. Yet it was listed as a comp and even though she had a recent closing on her house which should help establish her value, their algorithm still listed it at less than half of what she paid.

@Joseph M. listed some good ideas for doing some online research. A counties own assessor page is better than an aggregating site that pretends to be able to tell you an accurate value on any property in any market. Beyond that, i have found the best info. comes from investors themselves. Good luck with your research.
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J ScottPro Member
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Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
13y
Originally posted by Curt Davis:
Every investor has their own comfort level. @J Scott I am curious on how you are able to get actual MLS access in every market when it is normally only for RE agents.

In two of our markets, either/both my wife and/or I am licensed and in two of our markets, we are partnered with someone who is licensed...

That said, I agree with @Mike McKinzie and others that when dealing with rentals, it may be a bit easier to do due diligence from afar. But, I was more thinking about flips/rehabs, where the numbers are less forgiving -- I couldn't imagine doing flips in areas where I haven't been.
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Steve Babiak
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
13y
Why not just buy in Philadelphia? There are neighborhoods in Phila with decent cash flow. There were even some people who were buying in Camden and claiming they had decent cash flow (despite the high NJ property taxes). And even some of the Phila suburbs have some cash flow opportunities.

All of the above are well within one hour of Phila, depending on the specific neighborhood where you live.
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Stephen Masek
Investor · Mission Viejo, CA · Member since 2012 · 627 posts · 204 votes
13y
Originally posted by Chris Clothier:
@Chukwudi Motanya - the one thing I would not do is put any stock into what you read or see on Trulia or Zillow. Neither is reliable nor

Trulia and Zillow are useful, but only to a limited extent. The information on schools is useful. The information on other houses and the value of a particular house has to be viewed knowing it is all computer generated, so it can not be the only source of information. The information on past listings and transactions is helpful.
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Ali Boone
Real Estate Coach · Venice Beach, CA · Member since 2012 · 6k+ posts · 3k+ votes
13y
Yay Atlanta! I'm from there and my properties are all there, although I live in CA now.

The best thing I think you can do is network with other investors who are buying in the area you are interested in. See what they are buying, ask how they found or developed their teams, and then the due diligence you can do for yourself- looking at market statistics of course can be helpful but I think the best thing is talking to property managers in the area because they will know better than anyone the quality of the areas, the rentability, sales, etc.

Awesome!
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James Tobin
Dallas, TX · Member since 2013 · 25 posts · 1 vote
13y
@Joseph M. thanks for the insight on researching from out of state. I hadn't heard of the City Data forums and it's been really helpful. Also, never thought to use Yelp that way...very clever!
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Chukwudi Motanya
OP
Investor · Lithonia, GA · Member since 2012 · 231 posts · 43 votes
13y
Thanks for all the comments everyone! @Steve Babiak I would have loved to buy in Philadelphia and was planning on buying a duplex and living in one of the units, but im 23 and theres a possibility that my job could be moving me to a new location. I would hate to have a house in Philly and then have to move out of it with only being in it for 2 months.

My parents live in Atlanta and they could be the ones to help me with the process over there
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Stephen Masek
Investor · Mission Viejo, CA · Member since 2012 · 627 posts · 204 votes
13y
One more good resource - Craigslist, to learn current asking rents in an area.
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