Out of state investor, looking for good references

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Out of state investor, looking for good references

Steve RembuskosPro Member
Member since 2020 · 20 posts · 12 votes

Hi BiggerPockets Forums,

Live in CA and looking to invest in STR out of state. CA is not too friendly for STR's and very expensive. Can anyone recommend any resources in analyzing markets, risks, potential properties besides AirDNA. What are the best markets that people have experienced in terms of yields (ROI) and another other advice.

Thank you
Steve

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Michael BaumPro Member
Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
6mo

Hey @Steve Rembuskos, so you need to decide what you want out of your STR. Do you want a pure investment or do you want to visit and use it from time to time?

How far are you willing to go? Do you want a beachfront place or maybe in the mountains? Skiing? Lake/river front?

Personally I like places that are in nature with a great feature. Like our lakehouse. You can't go wrong with waterfront IMHO. Making the numbers work...that is another story.

Once you decide, you can ask here about specific areas and who is investing. Go on AirBNB and VRBO and look at STRs in that area. What are they renting for? How is their occupancy? What kind of amenities do they have?

Then you can start looking at properties and run some numbers to see if they work.

Our place would never work as a STR now. We bought before the boom and now our house is worth nearly 1m bucks. Can't make a red cent at that valuation.

But there are still places where it doesn't cost an arm and a leg. Just watch the regs before you get too deep.

You can't beat a great lake house!

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  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    6mo

    Hey @Steve Rembuskos, so you need to decide what you want out of your STR. Do you want a pure investment or do you want to visit and use it from time to time?

    How far are you willing to go? Do you want a beachfront place or maybe in the mountains? Skiing? Lake/river front?

    Personally I like places that are in nature with a great feature. Like our lakehouse. You can't go wrong with waterfront IMHO. Making the numbers work...that is another story.

    Once you decide, you can ask here about specific areas and who is investing. Go on AirBNB and VRBO and look at STRs in that area. What are they renting for? How is their occupancy? What kind of amenities do they have?

    Then you can start looking at properties and run some numbers to see if they work.

    Our place would never work as a STR now. We bought before the boom and now our house is worth nearly 1m bucks. Can't make a red cent at that valuation.

    But there are still places where it doesn't cost an arm and a leg. Just watch the regs before you get too deep.

    You can't beat a great lake house!

    5Reply
    • John UnderwoodPro Member
      Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
      6mo
      Quote from @Michael Baum:

      Hey @Steve Rembuskos, so you need to decide what you want out of your STR. Do you want a pure investment or do you want to visit and use it from time to time?

      How far are you willing to go? Do you want a beachfront place or maybe in the mountains? Skiing? Lake/river front?

      Personally I like places that are in nature with a great feature. Like our lakehouse. You can't go wrong with waterfront IMHO. Making the numbers work...that is another story.

      Once you decide, you can ask here about specific areas and who is investing. Go on AirBNB and VRBO and look at STRs in that area. What are they renting for? How is their occupancy? What kind of amenities do they have?

      Then you can start looking at properties and run some numbers to see if they work.

      Our place would never work as a STR now. We bought before the boom and now our house is worth nearly 1m bucks. Can't make a red cent at that valuation.

      But there are still places where it doesn't cost an arm and a leg. Just watch the regs before you get too deep.

      You can't beat a great lake house!


       Like Michael, I also love waterfront (lake, river, ocean) and I think this is a huge draw for other people as well.

      1Reply
    • Steve RembuskosPro Member
      OP
      Member since 2020 · 20 posts · 12 votes
      5mo

      @Michael Baum what a beautiful location. Thank you for taking your time in giving me your advice and responding. You're right, waterfront will always hold their value and a great location for an STR. Thanks for the advice regarding researching as well.

      it's just intimidating to start but I'm sure things work themselves out.  :) 

      Thank you again 

      1Reply
    • Steve RembuskosPro Member
      OP
      Member since 2020 · 20 posts · 12 votes
      5mo
      Quote from @John Underwood:
      Quote from @Michael Baum:

      Hey @Steve Rembuskos, so you need to decide what you want out of your STR. Do you want a pure investment or do you want to visit and use it from time to time?

      How far are you willing to go? Do you want a beachfront place or maybe in the mountains? Skiing? Lake/river front?

      Personally I like places that are in nature with a great feature. Like our lakehouse. You can't go wrong with waterfront IMHO. Making the numbers work...that is another story.

      Once you decide, you can ask here about specific areas and who is investing. Go on AirBNB and VRBO and look at STRs in that area. What are they renting for? How is their occupancy? What kind of amenities do they have?

      Then you can start looking at properties and run some numbers to see if they work.

      Our place would never work as a STR now. We bought before the boom and now our house is worth nearly 1m bucks. Can't make a red cent at that valuation.

      But there are still places where it doesn't cost an arm and a leg. Just watch the regs before you get too deep.

      You can't beat a great lake house!


       Like Michael, I also love waterfront (lake, river, ocean) and I think this is a huge draw for other people as well.

      You're right.  Water is a Zen spot for many.  Vacationing is all about getting away.  
      1Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    6mo

    Rabbu (of which I am a featured agent) is a pretty cool tool. They give some estimates and can pair you with agents/lenders in any local market. As mentioned above I recommend investing in a market you like and can access every so often. From there pick a few contenders and speak with local agents in the area (vetted STR specialists) and go from there. Good luck!

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
    WebsiteView Page
    0Reply
    • Steve RembuskosPro Member
      OP
      Member since 2020 · 20 posts · 12 votes
      5mo
      Quote from @Andrew Steffens:

      Rabbu (of which I am a featured agent) is a pretty cool tool. They give some estimates and can pair you with agents/lenders in any local market. As mentioned above I recommend investing in a market you like and can access every so often. From there pick a few contenders and speak with local agents in the area (vetted STR specialists) and go from there. Good luck!


       I've never heard of Rabbu.  Will definitely check them out.  I really appreciate it.  

      1Reply
  • Mike Klarman
    Specialist · NJ · Member since 2022 · 1k+ posts · 653 votes
    6mo

    The PA Poconos is a nice STR market. I refinanced a few STRs for a client in that market. He has very nice houses mind you, worth 800k+ with indoor swimming pools and the whole nine yards, but he has one house that makes him 400k per year in STR income. Insane. His loan payment is like 7k per month on the refi and he brings in 35k/month.

    He bought the house at a property auction for like 300k and put 200k into it.  He refinanced out for 600k or so.  

    A good STR has outdoor attractions. Hiking, skiing, theme parks, sporting events.

    0Reply
  • Steve RembuskosPro Member
    OP
    Member since 2020 · 20 posts · 12 votes
    5mo

    Thanks everyone for this great information about different markets to explore and resources. Makes a lot of sense to buy something that you'll enjoy as well as an investment. More passion for the STR than just an investment.

    1Reply
  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 954 votes
    5mo
    Quote from @Steve Rembuskos:

    Hi BiggerPockets Forums,

    Live in CA and looking to invest in STR out of state. CA is not too friendly for STR's and very expensive. Can anyone recommend any resources in analyzing markets, risks, potential properties besides AirDNA. What are the best markets that people have experienced in terms of yields (ROI) and another other advice.

    Thank you
    Steve


    You’re right about CA, between cost and STR regulations, it’s tough to make the numbers work there. Beyond AirDNA, most investors I see doing well are layering in actual local comp analysis, talking to property managers on the ground, and stress-testing numbers with conservative occupancy and expense assumptions instead of just relying on platform data. On markets, the “best” ones really depend on regulation stability as much as ROI, which is why some investors are shifting focus to more flexible Midwest markets, where you can sometimes pivot between STR and long-term rental strategies if rules tighten or demand shifts. The key is building in optionality so you’re not locked into one strategy if the market changes.
    [email protected]614-418-6081
    1Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    5mo

    Have you explored the great articles on this website?

    0Reply
  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    5mo
    Quote from @Steve Rembuskos:

    Hi BiggerPockets Forums,

    Live in CA and looking to invest in STR out of state. CA is not too friendly for STR's and very expensive. Can anyone recommend any resources in analyzing markets, risks, potential properties besides AirDNA. What are the best markets that people have experienced in terms of yields (ROI) and another other advice.

    Thank you
    Steve

    Hey Steve, great question and you’re looking at the right things—STR investing today really comes down to strong market selection and managing risk. Outside of AirDNA, you can cross-check data with tools like AirROI or PriceLabs, and also manually comp listings on Airbnb and Vrbo to get a real feel for occupancy and pricing. I’d focus heavily on RevPAR instead of just nightly rates, plus regulation risk and seasonality since those will impact your returns the most. A lot of investors are moving toward smaller vacation or mid-size markets where regulations are lighter and demand is more consistent, like mountain or drive-to destinations and parts of Florida. One thing newer investors underestimate is how quickly regulations can change and affect your entire model, so that’s worth extra attention. Also keep in mind STRs aren’t truly passive and expenses can swing more than long-term rentals, so underwrite conservatively. Overall, focus on stable demand and friendly regulations over just chasing high returns and you’ll be in a much better position.
    [email protected]614-300-7535
    Jimmy Lieu, Red 1 Realty4.9120 Reviews
    WebsiteView Page
    1Reply
    • Steve RembuskosPro Member
      OP
      Member since 2020 · 20 posts · 12 votes
      5mo

      @Jimmy Lieu Thank you for the great advice. Makes a lot of sense to cross reference AirROI, PriceLabs with AirBNB. Completely agree with you about regulation risk but how do you research if a certain location is safe for the long term as an STR or is at risk? Currently using AI to help with some of that research but not 100% if there are better ways to research. That's is again for taking the time to respond.
      Steve 

      0Reply
  • Dan H.Pro Member
    Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
    5mo

    I have had STRs in CA and STRs out of CA.  I have made much more on my CA STRs than OOS STRs.

    This does not mean I have given up on OOS STRs, but my last 3 offers have been in CA.

    The reality is few areas have provided the return of coastal CA RE. This is true for LTR or STR. Our first CA STRs is up $2.7m since purchase. I would be rolling in the cash flow, but I believe RE's super power is leverage so I refinanced in Dec 2021 and extracted to maximum LTV.

    Here are some thoughts about market

    - historically the highest return is achieved in the highest appreciating markets.  It is hard to go wrong if appreciation is over $5k/month, and hard to imagine a scenario where things are not outstanding with appreciation over $10k/month  

    - management choice can be as important as market.   A market with a rock star manager (I include co-host in this usage) is worth consideration.  I only offer on markets that I have a rockstar manager.  Fortunately I have rockstar managers in every market I have made offers on.

    - most markets have a significant off season.   This affects yearly occupancy.   Areas without a significant off season have higher yearly occupancy potential.

    - some STR markets have crazy high expenses. My last 2 offers were on monthly income to price ratio of 2.63% ($475k, $125k income) but my underwriting showed slightly negative cash flow near term (more than slightly negative in first year). The ratio is good, but the expenses in that market were very high for multiple reasons. Thorough underwriting is not only evaluating the income, but the expenses.

    my advice is to only exclude CA if you cannot execute a purchase.  


    Good luck

    1Reply
    • Apoorv Gupta
      Member since 2024 · 1 post · 0 votes
      5mo

      @Dan H. I found that it's very difficult to find a cash flowing market in CA which isn't prone to cery high fire risk. Any recommendations?

      0Reply
  • Steve RembuskosPro Member
    OP
    Member since 2020 · 20 posts · 12 votes
    5mo

    Thanks Dan for these comforting thoughts. I have the resources but being it's my first purchase I keep hearing how bad CA is for all rental markets. You make sense though especially for the long duration CA is a gold mine. Do you mind if I ask where along the coast do you see as an opportunity for great ROI?

    0Reply
    • Dan H.Pro Member
      Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
      5mo
      Quote from @Steve Rembuskos:

      Thanks Dan for these comforting thoughts. I have the resources but being it's my first purchase I keep hearing how bad CA is for all rental markets. You make sense though especially for the long duration CA is a gold mine. Do you mind if I ask where along the coast do you see as an opportunity for great ROI?

      Let me preface that I do not really know coastal Los Angeles or northward (excluding Santa Barbara where I have looked at RE in the fairly recent past).   So the only coastal I am listing is San Diego coastal.

       It depends on what you desire and if you really mean coast or water:

      - imperial beach is the cheapest beach front in CA.   The 2 reasons is a sewage issue and proximity to the border.   The sewage problem has never got more attention than currently.   Getting attention is a requirement before obtaining funding for this sort of effort.

      - 3 rivers (not coastal): considered close to sequoia national park.   I am looking here, but have not yet made an offer.   My reluctance is that it does not have the mountain look.

      - pacific beach still has quota room.  You will need a rock star manager not to bleed cash, but rock star managers I had as a requirement.

      Not sure why you limited to coastal.    The example from my earlier email was a luxury Sierra cabin.   It has rivers near it, but not river front.   Even with the good income ratio, I had it showing as negative cash flow for quite a while due to crazy high expenses.

      Good luck

      0Reply
  • Stephen Delahoussaye
    Real Estate Broker · Nashville, TN · Member since 2022 · 163 posts · 87 votes
    5mo

    Steve, as a fellow CA escapee who landed in Nashville, I'll share what I've learned about out-of-state STR analysis that AirDNA doesn't cover well.

    The biggest blind spot in most STR market analysis tools is regulatory risk. AirDNA will tell you revenue projections, occupancy rates, and comp data. What it won't tell you is whether the specific property you're looking at can actually get permitted for short-term rental use. This varies not just by city but by individual parcel and zone code, and it changes as cities pass new ordinances.

    Nashville is a good case study for this. We have 285,000+ parcels in the city, but only about 5,500 have active STR permits. The zoning rules are granular enough that two houses on the same street can have completely different eligibility depending on their zone designation. Some zones allow both owner-occupied and non-owner-occupied permits, others only allow owner-occupied, and a handful block STR entirely. If you're buying remotely and plan to run a non-owner-occupied operation, the zone code is the very first thing to check before you even look at revenue projections.

    For market analysis beyond AirDNA, I'd suggest looking at: the actual municipal code and zoning ordinances for your target market (boring but essential), Mashvisor for longer-term market trend data, and most importantly, talking to local operators who are actually running STRs in that specific neighborhood. The ground truth from someone managing five properties in a particular zip code is worth more than any platform's aggregate data.

    One more thing specific to out-of-state: most STR-friendly cities have a "responsible party" rule requiring someone within a certain radius who can respond to complaints. Nashville's is 25 miles. Factor in whether you need a local co-host or property manager from day one, because that cost directly affects your yield math.

    0Reply
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