New & looking to buy first rental

Cape Coral, Florida
New Member Introductions
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New & looking to buy first rental

Raul Payas
Member since 2025 · 1 post · 12 votes

Hello everyone,
My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.

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Todd AndersonPro Member
Real Estate Agent · Cape Coral, FL · Member since 2023 · 392 posts · 175 votes
11mo

@Raul Payas,

Welcome to the BP Community and soon to the REI world. It is great that you are doing your homework through BP.

I moved to Cape Coral  almost 3 years ago, and love the area.  I work with investors every day to evaluate the right market for them.  I would advise you to look close to home.  

The SW Florida market has been going through a correction lately.  Prices are down and rents are down.  This is making an new investment in the area proform worse than most expectations.  But this also brings opportunity.  It is definitely a buyers market and there are deals to be had that will work.  I have seen a number of deals that are available with tenants in the property.

The Future of florida investing is IMHO still bright.  I believe that the next 2 years will bring us back.  I also believe that now is the time to find the next property to buy.

I have learned that investing OOS will work in today's tech heavy world.  I work with investors from all over the country who are investing OOS because their local market does not work.  I have invested OOS myself in the past.  But if your market works it is the best way to get started.

Feel free to reach out with more specific questions.  I would be happy to talk with you about what I have found in this market.

Best of luck

[email protected]651-492-5652
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  • Jaron WallingPro Member
    Rental Property Investor · Indianapolis, IN · Member since 2018 · 4k+ posts · 4k+ votes
    11mo

    @Raul Payas If you guys have lived in Cape Coral I would stronger advice you look in your backyard. It's so much easier to leverage local contacts, relationships, lenders, and to be on site if you get into a renovation. 

    Going OOS is not impossible but it's challenging and more expensive. It's expensive but you won't know the markets as well as the local investors. If the backyard is impossible that's understandable but if you can't swim I'm avoiding big rivers. Just saying. 

    1Reply
  • Todd AndersonPro Member
    Real Estate Agent · Cape Coral, FL · Member since 2023 · 392 posts · 175 votes
    11mo

    @Raul Payas,

    Welcome to the BP Community and soon to the REI world. It is great that you are doing your homework through BP.

    I moved to Cape Coral  almost 3 years ago, and love the area.  I work with investors every day to evaluate the right market for them.  I would advise you to look close to home.  

    The SW Florida market has been going through a correction lately.  Prices are down and rents are down.  This is making an new investment in the area proform worse than most expectations.  But this also brings opportunity.  It is definitely a buyers market and there are deals to be had that will work.  I have seen a number of deals that are available with tenants in the property.

    The Future of florida investing is IMHO still bright.  I believe that the next 2 years will bring us back.  I also believe that now is the time to find the next property to buy.

    I have learned that investing OOS will work in today's tech heavy world.  I work with investors from all over the country who are investing OOS because their local market does not work.  I have invested OOS myself in the past.  But if your market works it is the best way to get started.

    Feel free to reach out with more specific questions.  I would be happy to talk with you about what I have found in this market.

    Best of luck

    [email protected]651-492-5652
    2Reply
  • Min ZhangBusiness Member
    Real Estate Agent · Member since 2022 · 1k+ posts · 1k+ votes
    11mo

    Hey Raul! Thanks for sharing your story. It’s awesome you and Lilly are taking the time to really learn before jumping in. My first rental started the same way with lots of research, lots of questions, and eventually just taking the leap.

    Florida could make sense if you want to stay close to the asset, but plenty of first timers also look toward the midwest because of the lower price points and steadier cash flow. Both paths can work, it just depends on what feels manageable for you two starting out.

    Are you leaning toward something turnkey or willing to take on light repairs for a better deal? Happy to keep the conversation going!

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  • Kerlous TadresBusiness Member
    Realtor · Columbus, OH · Member since 2023 · 1k+ posts · 1k+ votes
    11mo

    Hey @Raul Payas, out of state can give you better returns, but it only works if you have a solid property manager and contractor you trust. Before looking at properties in another market, I’d focus on interviewing and building that team first. My biggest recommendation is to pick one market and go deep. Learn rents, neighborhoods, and what a good deal looks like.

    [email protected]614-490-1163
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  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    11mo
    Quote from @Raul Payas:

    Hello everyone,
    My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.

    Hey Raul, welcome to BiggerPockets and congrats to you and Lilly for getting ahead of the game and preparing early—educating yourselves before jumping in is one of the best things you can do. A lot of people in your situation debate the Florida vs out-of-state route, and honestly it just comes down to where you can get the best mix of cash flow and long-term growth. Florida can work, but many areas have gotten pricey and tougher to cash flow. If you ever decide to look outside the state, I’d definitely suggest taking a look at Columbus, Ohio. I moved from Portland to Columbus in 2020 to invest and now own 10+ rentals here, and the macroeconomics are on fire—population is rising, job growth is strong, and huge companies are building and expanding here like Intel, Amazon, Google, Honda, Microsoft, LG, Facebook, and more. Even with all that growth, it’s still super affordable, and you can find properties in the $120–180K range that hit the 1% rule and cash flow from day one, plus the appreciation potential has been awesome. Either way, you’re doing all the right things by preparing early, and you’ll be in a great position next year. Happy to connect and answer any questions you have!

    [email protected]614-300-7535
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  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    11mo
    Quote from @Raul Payas:

    Hello everyone,
    My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.


    Hi Raul, if you're looking to invest out of state, you'll need a solid team of a PM, GC, a lender and an investor friendly investor. I would advise looking at the markets in the midwest

    [email protected]614-363-2787
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  • Stetson MillerBusiness Member
    Real Estate Broker · Fort Myers, FL · Member since 2019 · 576 posts · 423 votes
    11mo

    Hi @Raul Payas,

    Congratulations on you and your wife taking the first step towards this goal! I also want to reaffirm that the Cape Coral markets, as well as some other local areas such as Lehigh and Fort Myers, can very likely offer deals right now that meet your goals for this first purchase. One other thing that I don't see mentioned here yet is a house hack potential, with you living locally already. This can be a great strategy for gaining quick momentum and scale, without having to save a large down payment with an investment loan.

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  • Shakur Granger
    Real Estate Agent · Triad North Carolina · Member since 2025 · 50 posts · 13 votes
    11mo

    Congrats on getting ready for your first rental — that’s a huge step. It’s smart that you’re giving yourselves time to learn before jumping in.

    One thing I’ve noticed when comparing Florida vs. out-of-state markets is how different the risk profiles can be, even when the properties look similar on the surface. Insurance, taxes, and storm-related costs in Florida can really shift the math, while some out-of-state markets offer more predictable cash flow but less appreciation.

    A couple things that helped me when I was evaluating markets:

    • Look at rent-to-price ratios first — it quickly shows which markets even deserve deeper research

    • Compare insurance + tax differences, especially since they vary a lot state to state

    • Pay attention to population stability and job trends, not just property prices

    • Run your numbers twice — once with local numbers and once with an out-of-state market you’re considering

    • Think about whether you want hands-on or hands-off management for your first deal

    Whatever you choose, taking the time now to compare both options will make your first buy a lot smoother.

    Curious — are you leaning more toward staying local, or are you open to trying a totally different market?

    0Reply
  • Zeke Liston
    Real Estate Agent · Columbus, OH · Member since 2018 · 1k+ posts · 1k+ votes
    11mo
    Quote from @Raul Payas:

    Hello everyone,
    My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.

    Hi Raul, welcome to real estate investing! If you can, I strongly suggest going to real estate meetups. They offer a fantastic chance to learn and meet experienced investors. If you plan to invest out of state, spend time researching the market and, most importantly, build a solid team first. Having the right people in place can make all the difference in your investing journey.
    0Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    11mo
    Quote from @Raul Payas:

    Hello everyone,
    My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.


    Welcome to BP

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  • Alfath AhmedBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
    11mo
    Quote from @Raul Payas:

    Hello everyone,
    My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.


     Congrats on getting started. Check out the midwest. Ton of tech development with massive companies investing and supporting job growth. No worries for hurricane or floods either. 

    Find a good investor agent that can give you deal flow, contractors, lenders, and a good PM.

    [email protected]614-802-5698
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  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    11mo
    Quote from @Raul Payas:

    Hello everyone,
    My name is Raul, and my wife, Lilly, and I are both 41 years old. We’re planning to purchase our first rental property next year and have been preparing by watching BiggerPockets content and educating ourselves as much as possible. This is an exciting yet significant step for us, and we want to make the best-informed decisions. We currently live in Cape Coral, FL, but we are still considering whether our first investment should be in Florida or out of state.

     Congratulations @Raul Payas and your wife Lily.
    I will recommend you start your research here https://www.biggerpockets.com/markets you will get a lot of clarity on how to proceed once your review the top 100 markets here: https://www.biggerpockets.com/resources/market-data/2024-top...

    All the best and keep us posted.

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  • Shakur Granger
    Real Estate Agent · Triad North Carolina · Member since 2025 · 50 posts · 13 votes
    11mo

    Hey, appreciate the perspective I hear you.

    Just to clarify where I was coming from, I'm speaking on what I've actually been seeing here in the Triad (Greensboro / Winston-Salem / High Point). A lot of investors out here lean toward that 70–75% LTV range because the rents and DSCR requirements in some submarkets don't always support an 80% refi comfortably.

    For example, most of the rentals I analyze in Greensboro average around the mid-$1,500s in rent, and median home values in the more investor-friendly pockets usually fall somewhere in that $180K–$220K range. When you line those up with today's rates, the 70–75% band usually leaves a safer DSCR cushion especially if the appraisal comes in a little soft.

    Now, I'm with you that if the rehab is tight and the ARV is rock solid, higher LTV can work. No argument there. I've seen investors hit 78–80% here too it just has to be dialed in.

    I just like seeing how different markets structure things, because leverage strategy really does shift city to city. That’s why these threads are helpful. Let’s people compare what’s actually working on the ground.

    0Reply
  • Elealeh Fulmaran
    Specialist · Member since 2025 · 483 posts · 270 votes
    11mo

    Raul, you’re doing the right things by learning early and giving yourselves time before the first buy. Two quick tips: define a simple buy box now so you’re not chasing everything, and test Florida vs out of state by running the same 3–5 deals through a basic cash flow calculator, then sanity‑check rents and expenses with a local property manager in each market.

    0Reply
  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 969 votes
    11mo

    @Raul Payas

    Hey Raul, sounds like you and Lilly are doing all the right prep before jumping in. For first rentals, I usually see out of state investors get the most leverage and cash flow from markets in the Midwest, where you can pick up undervalued, cash flowing properties and scale faster. The key is having a good team on the ground, contractors, property managers, and lenders, so you can manage remotely if needed. If you want, I can share some off market multi family deals and show how other investors structure their first rentals to start building wealth quickly.

    [email protected]614-418-6081
    0Reply
  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 969 votes
    11mo
    [email protected]614-418-6081
    0Reply
  • Michael SmytheBusiness Member
    Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
    11mo

    @Raul Payas

    How much do you know about Property Classes?

    Recommend you spend some time learning about them, so you don’t mistakenly buy a property that will NEVER meet your expectations!

    Why is Property Class so important for investors to understand and apply in their investing strategies?

    Because the Property Class dictates the Class of the tenant pool that the property will attract.

    The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.

    Both Property Class and Tenant Class will affect what type of contractors, handymen and property management companies you should target and be willing to deal with a property.

    The Property Class will also impact the maintenance & renovations you do to, “Maintain to the Neighborhood”.

    Why is that important?

    Well, if you buy & renovate a property in Class D area to Class A standards, what Tenant Class will actually rent it?

    Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?

    So, if you fail to apply the correct assumptions to a property, your expectations won’t be met, and it may even be a financial disaster.

    We use the following to rank Property Classes, in order of importance:

    • Property Tenant Pool: closely linked to location, but not always.
    • Property Location: closely linked to tenant pool, but not always.
    • Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”

    Key metrics for each Property Class:

    Class A Properties:
    Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
    Tenant Default: 0-5% probability of eviction or early lease termination.
    Section 8: Class A rents are too high and won’t be approved.
    Vacancies: 5-10%, depending on market conditions.
    Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.

    Class B Properties:
    Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
    Tenant Default    : 5-10% probability of eviction or early lease termination.
    Vacancies    : 10-15%, depending on market conditions.
    Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
    Section 8: Class B rents are usually too high for the Section 8 program.

    Class C Properties:
    Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
    Tenant Default: 10-20% probability of eviction or early lease termination.
    Section 8: Class C rents usually meet program requirements, proper screening still recommended.
    Vacancies: 10-20%, depending on market conditions and tenant screening.
    Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.

    Class D Properties:
    Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
    Tenant Default: 20-30% probability of eviction or early lease termination.
    Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
    Vacancies: 20%+, depending on market conditions and tenant screening.
    Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.

    Where did we get our FICO credit score information from?

    Check out this chart:

    FICO Score

    Pct of Population

    Default Probability

    800 or more

    13.00%

    1.00%

    750-799

    27.00%

    1.00%

    700-749

    18.00%

    4.40%

    650-699

    15.00%

    8.90%

    600-649

    12.00%

    15.80%

    550-599

    8.00%

    22.50%

    500-549

    5.00%

    28.40%

    Less than 499

    2.00%

    41.00%

    Source: Fair Isaac Company

    Make sure you understand the Class of properties you are looking at and the corresponding results to expect.

    Metro Detroit has 132 cities, the City of Detroit 183 Neighborhoods, which we’re analyzing and classifying. Check out the map on our website where we’ve made this all easy to follow.

    We can also share numerous examples of properties & portfolios we’ve assisted investors with!

    DM us if you’d like to discuss this logical approach in greater detail!

    Horror Stories from those that did NOT Understand What they were Buying:

    https://www.biggerpockets.com/forums/48/topics/1137397-baltimore-a-path-to-never-ending-pain

    https://www.biggerpockets.com/forums/432/topics/1231840-sell-at-a-loss-or-rent-at-a-loss

    https://www.biggerpockets.com/forums/311/topics/840134-memphis-turnkey-tenant-turnover-costs

    https://www.biggerpockets.com/forums/963/topics/1195280-experience-of-oos-investing-in-cleveland-after-15-years
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  • Allison Park
    Member since 2024 · 158 posts · 88 votes
    11mo

    Hi there Raul and Lilly, I just started my investing journey this year. I would recommend trying to find something local and manage yourself for your first property. I have learned much more on my own and save a lot by not having PM fees which are significant...usually half first months rent and the 10% of rent there after. HOA fees can eat into returns but they are also usually covering things you would have to pay for anyway and can pass some or all along to the tenant. HOAs help to maintain the quality of the neighborhood. Definitely get a copy of the bylaws and architectural guidelines. You can use copilot or chat gpt to quickly summarize rental guidelines. Good luck!

    0Reply
  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · Sarasota, FL · Member since 2017 · 5k+ posts · 3k+ votes
    11mo

    @Raul Payas, congrats on taking the first step! I was just in Cape Coral last week, such a great area! I’m actually based in Sarasota.

    When deciding between investing in Florida or out of state, it's important to understand the tax implications. Since you live in Florida, which has no state income tax, any rental income you earn in Florida won't be taxed by the state. However, if you invest out-of-state, the tax rules change. You’ll have to pay taxes in the state where the property is located, even if that state has an income tax.

    For example, if you live in Florida and invest in a state like Georgia, you’ll pay taxes in Georgia because it has an income tax. Florida won’t tax your rental income, but you’ll need to report the income on your Florida return.

    I’ve sent you a DM with all the necessary resources, feel free to check them out!

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  • Clare PitcherBusiness Member
    Property Manager · Milwaukee, WI · Member since 2024 · 162 posts · 97 votes
    11mo

    I would personally start local to gain experience before testing out other markets. If you eventually turn to out of state, a good property manager goes a long way!

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  • Amber Stout
    Lender · Tampa/Saint Petersburg, FL · Member since 2014 · 356 posts · 148 votes
    11mo

    Hi Raul, that's exciting you're looking to purchase your first rental property. I do think it's advantageous to invest in your market for many reasons. You can also scoop up DEALS right now in Cape Coral so it could be a solid market for you to invest in.

    Since it's your first property, I highly recommend working with an agent that specializes in investments so they can point out things you may be missing. I know a couple in Cape Coral that would be able to help if needed. If you need an investor friendly lender, I'm happy to help. 


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