Out of State Rentals

General Landlording & Rental Properties
5yFollow

Out of State Rentals

KC Conti
Finger Lakes, NY · Member since 2018 · 18 posts · 15 votes

Good Morning All,

Thank you for taking the time to read my post. I have recently paid off my house and become debt free. I am currently hustling to save as much money as I can. I would like to get a few rentals, but given Covid and the evictions restrictions in NY. I am thinking buying local is not a good idea. I have heard nothing but horror stories from other land lords who are struggling because tenants aren't making their rent (even though they are working or collecting unemployment).

I am curious about your experiences buying out of state? Does anyone have good luck with this? I have heard there are a few states that are much more landlord friendly and I would rather spend my money there.

I have found roof stock, but again I haven't seen a lot of upstanding reviews about the website. I really want to find a way to supplement my income but I don't think New York is the right state to do it in. I  would appreciate any thoughts or advice.

Thanks again! 
9Reply
152 views

Most Popular Reply

Remington LymanBusiness Member
Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
5y
Originally posted by @KC Conti:

Good Morning All,

Thank you for taking the time to read my post. I have recently paid off my house and become debt free. I am currently hustling to save as much money as I can. I would like to get a few rentals, but given Covid and the evictions restrictions in NY. I am thinking buying local is not a good idea. I have heard nothing but horror stories from other land lords who are struggling because tenants aren't making their rent (even though they are working or collecting unemployment).

I am curious about your experiences buying out of state? Does anyone have good luck with this? I have heard there are a few states that are much more landlord friendly and I would rather spend my money there.

I have found roof stock, but again I haven't seen a lot of upstanding reviews about the website. I really want to find a way to supplement my income but I don't think New York is the right state to do it in. I  would appreciate any thoughts or advice.

Thanks again! 

 It does not matter where you start as long as you develop your Core 4. The core 4 is David Greene’s strategy for long-distance and made up of a realtor, contractor, property manager, and lender. Once you have this team in place, you should be able to confidently invest in any market.

As for picking a specific market - I would go after one with an increasing job and population growth. I invest and work in Columbus, Ohio.

[email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
Reafco512 Reviews
WebsiteView Page
11Reply
See this reply in the discussion

66 Replies

Jump to latestLatest
  • KC Conti
    OP
    Finger Lakes, NY · Member since 2018 · 18 posts · 15 votes
    5y
    Originally posted by @Dell J.:

    Are you upstate NY?  Many people invest in upstate NY and are successful with it.   You can look into other states but dont just throw away your home town advantage

    I am in Upstate New York. But the problem is our Governor has made it so tenants do not have to pay rent. Landlords have been out of income since March and there really is no end in sight. I backed out of a great duplex, I had my own tenants already lined up, but the problem is my attorney told me I couldn't get rid of the ones already in there. 

    0Reply
  • Ari Hadar
    Investor · Member since 2020 · 401 posts · 86 votes
    5y
    Originally posted by @Remington Lyman:
    Originally posted by @KC Conti:

    Good Morning All,

    Thank you for taking the time to read my post. I have recently paid off my house and become debt free. I am currently hustling to save as much money as I can. I would like to get a few rentals, but given Covid and the evictions restrictions in NY. I am thinking buying local is not a good idea. I have heard nothing but horror stories from other land lords who are struggling because tenants aren't making their rent (even though they are working or collecting unemployment).

    I am curious about your experiences buying out of state? Does anyone have good luck with this? I have heard there are a few states that are much more landlord friendly and I would rather spend my money there.

    I have found roof stock, but again I haven't seen a lot of upstanding reviews about the website. I really want to find a way to supplement my income but I don't think New York is the right state to do it in. I  would appreciate any thoughts or advice.

    Thanks again! 

     It does not matter where you start as long as you develop your Core 4. The core 4 is David Greene’s strategy for long-distance and made up of a realtor, contractor, property manager, and lender. Once you have this team in place, you should be able to confidently invest in any market.

    As for picking a specific market - I would go after one with an increasing job and population growth. I invest and work in Columbus, Ohio.

    About the core 4 what if i work with 2 or more realtors? 

    What about greater Cleveland market? I think it has better CF than colombus, Louisville ky and indianapolis in spite the fact there is no population growth. 

    1Reply
  • KC Conti
    OP
    Finger Lakes, NY · Member since 2018 · 18 posts · 15 votes
    5y
    Originally posted by @Rohan D.:

    Definitely check out the roofstock website since I found it useful along my journey. I am listing some pros and cons I had mentioned in another forum about using roofstock:

    Pros:
    1. great analysis tools to run the numbers on a property. You get good practice analyzing properties and become more familiar with the system.

    2. Many properties have disclosures and inspections already done which helps you make informed decisions

    3. They sell properties which are currently occupied. so that is some sort of a safety net for many.

    Cons:

    1. In hot markets, delay in response can cost you. MLS to Roofstock can take anywhere from 0.5 to 1 day. Add another day for you to sign some edocs and put the offer. By then the house is gone.

    2. The financial calculations they use for "Property Tax" is as if it is owner occupied (not sure if they have updated this bug). But most of us are investors, and investment properties have higher property tax percentages. This can give you misleading financial information and is something you have to account for manually in your calculations

    what folks say about building a good team is absolutely important, but this process is rather organic for your first investment.

    Readup about the investment strategies and make sure you are comfortable with them. (Eg: cash flow vs appreciation, buy and hold vs flips, sfh vs multifamily, handson vs passive etc) once you have identified your niche, dive deep.

     Thank you so much!!!! That really helped break things down for me! 

    0Reply
  • KC Conti
    OP
    Finger Lakes, NY · Member since 2018 · 18 posts · 15 votes
    5y

    So far the general consensus seems to be OH. It is only about 4 hours from me. 

    I would like to try and keep as much stuff 'in-house' as possible. My husband is a contractor by trade, and I really enjoy managing properties. Big renovations we would handle, but small regular maintenance I would need to find a local contractor. 

     Maybe I will plan a trip to OH and check out some areas that might be beneficial! 

    I really REALLY appreciate everyone's advice!  

    1Reply
  • Jenni Villane
    Member since 2019 · 13 posts · 16 votes
    5y

    @Carol Birnberg That’s juts outside of one of the areas we have focused on. We have property in Winter Park and also Tallahassee. Sorry, I don’t have any specific experience in Edgewater.

    0Reply
  • Thomas Greer
    Real Estate Consultant · Member since 2020 · 80 posts · 102 votes
    5y

    Just to give another viewpoint - if you are looking at 1-2 properties then you only really care about how those properties perform and not about the larger economics.  Weigh the benefit of investing locally with the difficulties of investing out of state (which I am not against at all).  If you see a property that works for you locally, and you believe in.. go for it.  Don't pass because a market report says that statewide appreciation is lackluster.  I guess, what I like to say is that the variability in asset performance is extreme on the individual/micro scale.  You can find solid assets in a poor performing city or bad assets in a good one. 

    Just a bit of "devil's advocate" and food for thought.  If I lived in LA or NY...I would probably be investing in OH too!

    2Reply
  • Account Closed
    Rental Property Investor · Torrance, CA · Member since 2016 · 724 posts · 1k+ votes
    5y

    @KC Conti I have rentals in Indianapolis and South Bend. So far I haven’t had issues collecting rent. But, I believe that has more to do with tenant screening than it does with location. The eviction memorandum is nation wide. If there are deals in your area then I say invest there. Out of state investing can be a pain, and the overhead expenses are higher because you have to hire a PM. People invest OOS because they have to. It’s not optimal. If I lived in an area that had cashflow I would invest there.

    1Reply
  • Steven Foster Wilson
    Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
    5y
    Originally posted by @KC Conti:

    Good Morning All,

    Thank you for taking the time to read my post. I have recently paid off my house and become debt free. I am currently hustling to save as much money as I can. I would like to get a few rentals, but given Covid and the evictions restrictions in NY. I am thinking buying local is not a good idea. I have heard nothing but horror stories from other land lords who are struggling because tenants aren't making their rent (even though they are working or collecting unemployment).

    I am curious about your experiences buying out of state? Does anyone have good luck with this? I have heard there are a few states that are much more landlord friendly and I would rather spend my money there.

    I have found roof stock, but again I haven't seen a lot of upstanding reviews about the website. I really want to find a way to supplement my income but I don't think New York is the right state to do it in. I  would appreciate any thoughts or advice.

    Thanks again! 

     I will jump on the Columbus train and say that this place is incredible for investing. We have great appreciation, incredible CF, and landlord friendly policies. 

    2Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    5y
    Originally posted by @Ari Hadar:
    Originally posted by @Remington Lyman:
    Originally posted by @KC Conti:

    Good Morning All,

    Thank you for taking the time to read my post. I have recently paid off my house and become debt free. I am currently hustling to save as much money as I can. I would like to get a few rentals, but given Covid and the evictions restrictions in NY. I am thinking buying local is not a good idea. I have heard nothing but horror stories from other land lords who are struggling because tenants aren't making their rent (even though they are working or collecting unemployment).

    I am curious about your experiences buying out of state? Does anyone have good luck with this? I have heard there are a few states that are much more landlord friendly and I would rather spend my money there.

    I have found roof stock, but again I haven't seen a lot of upstanding reviews about the website. I really want to find a way to supplement my income but I don't think New York is the right state to do it in. I  would appreciate any thoughts or advice.

    Thanks again! 

     It does not matter where you start as long as you develop your Core 4. The core 4 is David Greene’s strategy for long-distance and made up of a realtor, contractor, property manager, and lender. Once you have this team in place, you should be able to confidently invest in any market.

    As for picking a specific market - I would go after one with an increasing job and population growth. I invest and work in Columbus, Ohio.

    About the core 4 what if i work with 2 or more realtors? 

    What about greater Cleveland market? I think it has better CF than colombus, Louisville ky and indianapolis in spite the fact there is no population growth. 

    There are pros and cons about working with more than one Realtor. If you work with more than one Realtor you are not building as strong of a relationship with one as you are with the two. The pros are you may get more deal flow. Regardless it is tough to find one good Realtor in any market let along two.

    [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
    Reafco512 Reviews
    WebsiteView Page
    0Reply
  • Taj Hayden
    Maple Valley, WA · Member since 2017 · 45 posts · 12 votes
    5y

    @KC Conti I would listen to the BP podcast 402 on identifying your best market, neighborhood and property. I just listened to it yesterday and took some great notes. You seem to be in a good spot financially so it would be wise to get a better understanding of what the pros recommend.

    1Reply
  • Brett D.
    New to Real Estate · Los Angeles, CA · Member since 2020 · 61 posts · 26 votes
    5y

    I appreciate everyone's input on this. I'm in Southern California and am strongly considering OOS. I've been looking into Clarksville Tennessee. But I've certainly been hearing a lot about Kansas City, Columbus, and Indianapolis. Anyone have experience between these four that can shed some light on comparisons?

    1Reply
  • Khaled El DorryPro Member
    Casselberry, FL · Member since 2016 · 111 posts · 54 votes
    5y

    @KC Conti I lived in Texas and bought in Florida and was almost sweat free (there were some hiccups) but I managed 3 SFH's remotely and had great success. Please reach out if you need

    More detail.

    1Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    5y
    Originally posted by @Brett D.:

    I appreciate everyone's input on this. I'm in Southern California and am strongly considering OOS. I've been looking into Clarksville Tennessee. But I've certainly been hearing a lot about Kansas City, Columbus, and Indianapolis. Anyone have experience between these four that can shed some light on comparisons?

     I have only invested in Columbus. Either one of those options should be fine. It more matters where you can develop your core 4 the best. Columbus, Ohio seems like an easy place to do that because of all the eager, local Realtors and lenders like @Chris Wharton on this site. We are definitely lacking in the contracting space though.

    [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
    Reafco512 Reviews
    WebsiteView Page
    1Reply
  • JJ P.
    Real Estate Agent · San DIego · Member since 2019 · 177 posts · 185 votes
    5y

    I'll be the contrarian here... If I were buying my very first investment property and looking to become a RE investor long term as a wealth building strategy, there's no way I'd buy in an unknown area and try to "build a team" to run my business. 

     Instead, I'd focus on where the value can be found in my area--say, up to a 3 hour drive, maximum, with closer being better.  Then I'd focus on finding a good realtor and a good lender to help me learn the area and finance the purchase, respectively.   Then I'd read, research, drive the streets and look online until I felt like I somewhat had a handle on my areas of interest.   Get out there and look around.   See properties and do drive bys until you feel confident that you've got an idea of how an area works, and if it works for you.  Surely there's something within a morning's drive that will suit you, without jumping to unknown lands and people to outsource your future to.  For the time being, you only need one good purchase.   I'll bet there are few dozen right now, within a 3 hour drive of wherever you are sitting, that would be great for you.  You just need to know one when you see it.  

     There's no magic wand to making a good, common sense investment and you might as well get your boots on the ground and get going.    

    5Reply
  • Michael Swan
    Rental Property Investor · San Diego, CA · Member since 2014 · 1k+ posts · 2k+ votes
    5y

    @KC Conti

    This is Swanny. Be careful and talk to as many investors as you can that invest in the areas you want to invest. I live in San Diego and invest in Northeast Ohio. There are many landmines you can step in when investing out of state. By talking to real investors in the areas you want to invest in, they have no financial incentive to give you advice and will give you honest and reliable advice.

    1Reply
  • Thomas Corley
    Real Estate Agent · Phoenix, AZ · Member since 2018 · 127 posts · 62 votes
    5y

    @KC Conti It really depends on what you are looking for as far as an investment I would first figure out if I want appreciation or cash flow then you can narrow the city’s down but I invest in AZ were I’m currently living and also out of state in WA I love appreciation so these are great markets for it. Let me know if you do decide AZ I can definitely point you in the right  direction. Good luck!

    0Reply
  • Eli Konig
    Member since 2020 · 41 posts · 21 votes
    5y

    Before you close on A deal out of your state make sure you have A good Property Manager that is knowledgeable in the local market and responds quickly as if as you would of been there, you don't want to drive A few hours for A non flushing toilet, or to see an inspector etc.

    Also I would recommend multi family vs Sfr when investing far from home, you just have less roofs, heaters... but everything bowls down to a good property manager locally.

    0Reply
  • Greg Houts
    Rental Property Investor · Greenville SC / Atlanta GA · Member since 2018 · 22 posts · 20 votes
    5y

    @KC Conti Loads of great suggestions and shared wisdom on this thread. I've lived out-of-country for the last six years so all of my investments have been OOS. As recommended by others, start by buying and reading David Greene's book. I would say hands-down that the realtor you choose is likely the biggest factor. I have been absolutely blessed finding amazing investor-agents who treated my investments as their personal investments. Key is that they are all investors themselves and have a vested interest in my success, since they know that the better I do on one investment would bring them additional business on future investments in their area. The rest of my team has (mostly) stemmed from my agents' contacts (e.g. contractors, lenders, etc.).

    While nothing can replace walking a property in-person, technology can get you pretty close. If you find a prospective property, have your agent (or representative) walk you through each property via video call, starting from the outside-in and then room by room. Check every inch of the property via video call. The amount of time an agent takes to do that is equivalent to the time it would take them to show a house in-person, so don't feel bad for painstakingly going through every detail. Record it if possible and take detailed notes. Then run your own math, both for ARV and estimating repair costs. Your agent can facilitate having contractors walk/view the house and provide estimates. Then compare your numbers with your agent's number to finalize you offer price (if it's still in play after running the math). Regarding closing, you should be able to assign limited power-of-attorney to your agent to close on your behalf (make sure the closing attorney is on board first).

    Finally, with 1-5 properties and a list of contractors, you don't need to pay a full-time property manager. I pay my agents the equivalent of one months' rent to help screen tenants and show the property. They do the listing/marketing, field the calls, show the house or work with renter's agents, etc. I then make the final call based on the credit report and background checks, etc. That A) puts me at arms length for legal reasons and B) takes all of the back-and-forth off my plate. I then self-manage the rent collection and maintenance/repairs. Yes, that can make you more beholden to contractors following through and requires more oversight than someone local, but I don't see the benefit of paying a PM (and still having to "manage the manager") until I scale to 10 or more doors.

    P.S. Don't forget the state tax implications by running a rental in another state. And if you plan to use an LLC then adds additional considerations, etc. Hope this helps. Feel free to ping me directly and happy to share my experiences.

    2Reply
  • Daniel Pierson
    Investor · San Francisco, CA · Member since 2015 · 75 posts · 25 votes
    5y

    @KC Conti I own out of state and have been happy with my investment. As others have mentioned, it's about your team on the ground and I also find that's it's useful to invest in an area where you have family/friends who can serve as an extra set of eyes on your property. If nothing else, it will give you peace of mind! Not sure about your local laws in upstate new york, but I know Ashley Kehr who hosts the BP Rookie Podcast is killing it there, so she might have some good ideas for you. Best of luck.

    0Reply
  • KC Conti
    OP
    Finger Lakes, NY · Member since 2018 · 18 posts · 15 votes
    5y
    Originally posted by @Thomas Greer:

    Just to give another viewpoint - if you are looking at 1-2 properties then you only really care about how those properties perform and not about the larger economics.  Weigh the benefit of investing locally with the difficulties of investing out of state (which I am not against at all).  If you see a property that works for you locally, and you believe in.. go for it.  Don't pass because a market report says that statewide appreciation is lackluster.  I guess, what I like to say is that the variability in asset performance is extreme on the individual/micro scale.  You can find solid assets in a poor performing city or bad assets in a good one. 

    Just a bit of "devil's advocate" and food for thought.  If I lived in LA or NY...I would probably be investing in OH too!

    Haha!!! Thanks Thomas! I want to start with 1-2 properties, but I really want to leave my full - time job, and do something with this full-time. 

    1Reply
  • Rick BassettBusiness Member
    Property Manager · Greater New Haven, CT · Member since 2010 · 377 posts · 434 votes
    5y

    @ KC Conti: Keep in mind that it's hard to replace a full-time salary and benefits without the scale of numerous cash flowing properties, always do the math before leaving your day job. Benefits (medical, dental, 401k..etc) are very expensive.

    For me, the math finally works but I've made the real estate schedule work with my day job as a University Professor. 

    475-900-3100
    Bassett Property Management5108 Reviews
    WebsiteView Page
    0Reply
  • Ian WalshBusiness Member
    Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    5y

    The grass is not greener on the other side.  Every city/state has millionares in your local market.  I prefer to stay in my local market because adding distance adds and element of risk.  

    0Reply
  • Joe Behr
    Fuquay-Varina, NC · Member since 2017 · 3 posts · 1 vote
    5y

    @Steven May, if im running a super conservative model, 5% capex, 5% maintenace, 5% vacancy, 10% management is that reasonable where you are at? Are the properties being bought up by cash immediately?

    0Reply
  • Adam Hobson
    Specialist · Helena, AL · Member since 2017 · 40 posts · 100 votes
    5y

    @KC Conti I am an investor and wholesaler in Birmingham Alabama. Investors are flocking to Birmingham right now due to high cash flow. There are a lot of southern cities with good cash flow and low entry prices. I have sold houses to several out of state investors lately.

    0Reply
  • Account Closed
    Rental Property Investor · Glens Falls, NY · Member since 2016 · 176 posts · 169 votes
    5y

    Upstate New York has great cash flow. If you're looking at properties now in your area the seller should be able to prove payment history on current tenants. Many municipalities are opening courts- you can still evict for lease breaches. Don't let King Andy scare you from buying locally- I personally wouldn't invest OOS for your first deal or two especially with no experience. Take advantage of the market you know best and buy with confidence. 

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free