New here/Help with out of state investing

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New here/Help with out of state investing

Abdul N.
Member since 2025 · 11 posts · 19 votes

Hi everyone, 

I am new to the forum would love your guidance. My desire is to invest long distance due to the high prices and suboptimal cashflow in my current city. I’ve heard about Toledo, Cleveland, Memphis, and Detroit being good options but open to invest anywhere in the country as long as the numbers work. My target is single family below 150k or multifamily units below 300k. I’m fine with average cashflow and/or appreciation because I plan to buy and hold long term. I’m also open to mid term rentals. I prefer turnkey property or those that need light cosmetic work. I have a great credit score and have saved up enough money to be able to make down payments and scale up. I am very motivated and would love to work with anyone (realtors, property managers, mentors, fellow investors) who is as motivated and can assist in the process.

4Reply
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Most Popular Reply

Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
9mo

@Abdul N.

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

[email protected]248-209-6824
Logical Property Management4.9459 Reviews
WebsiteView Page
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13 Replies

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  • Leroy K. WilliamsPro Member
    Property Manager · Southfield Mi · Member since 2018 · 183 posts · 172 votes
    9mo

    Greetings Abdul,  

    Your goals are very realistic as long as you understand that location will be key to your success. We help investors in Detroit MI with doing exactly what you are setting out to do so feel free to reach out to me by inbox if you want to explore the Metro Detroit Market. For LTRs in Detroit, on average the opportunity is buying for $50l-$55k, Cosmetic Rehab cost of $15k-$20k and ARV of $115k-$120k. These numbers work for the DSCR refi. This will typically be a 3bd/1 bath home that will rent for $1350-$1,400 per month. After everything is all said and done the average net cash flow after all expenses is $300-$350 per month

    As with any area you need to make sure you connect with people indigenous to the area. This way they can point you in the right direction and help you avoid some of the pitfalls that exist in every market. You will also need help with lowering property taxes, finding the right insurance, and selecting properties that fit the BRRRR model.

    Let's connect, I would love to show off my city and discuss the opportunities in Detroit.  

    0Reply
    • Abdul N.
      OP
      Member since 2025 · 11 posts · 19 votes
      9mo
      Quote from @Leroy K. Williams:

      Greetings Abdul,  

      Your goals are very realistic as long as you understand that location will be key to your success. We help investors in Detroit MI with doing exactly what you are setting out to do so feel free to reach out to me by inbox if you want to explore the Metro Detroit Market. For LTRs in Detroit, on average the opportunity is buying for $50l-$55k, Cosmetic Rehab cost of $15k-$20k and ARV of $115k-$120k. These numbers work for the DSCR refi. This will typically be a 3bd/1 bath home that will rent for $1350-$1,400 per month. After everything is all said and done the average net cash flow after all expenses is $300-$350 per month

      As with any area you need to make sure you connect with people indigenous to the area. This way they can point you in the right direction and help you avoid some of the pitfalls that exist in every market. You will also need help with lowering property taxes, finding the right insurance, and selecting properties that fit the BRRRR model.

      Let's connect, I would love to show off my city and discuss the opportunities in Detroit.  


       Great, thanks for the advice, will get in touch via personal message.

      0Reply
  • Jackelyn Lee
    Property Manager · Toledo, OH · Member since 2021 · 58 posts · 92 votes
    9mo
    Quote from @Abdul N.:

    Hi everyone, 

    I am new to the forum would love your guidance. My desire is to invest long distance due to the high prices and suboptimal cashflow in my current city. I’ve heard about Toledo, Cleveland, Memphis, and Detroit being good options but open to invest anywhere in the country as long as the numbers work. My target is single family below 150k or multifamily units below 300k. I’m fine with average cashflow and/or appreciation because I plan to buy and hold long term. I’m also open to mid term rentals. I prefer turnkey property or those that need light cosmetic work. I have a great credit score and have saved up enough money to be able to make down payments and scale up. I am very motivated and would love to work with anyone (realtors, property managers, mentors, fellow investors) who is as motivated and can assist in the process.


    Welcome to the forum. I’m in Toledo and I’m a property manager + realtor here, so I’ll give you the real version from inside the market.

    I started investing in Toledo in 2018 and built from there. Today my company manages around 600 doors, I own a remodeling company, and I personally own about 150 doors. Toledo has treated us well for buy and hold, but only because we treat it like a systems business, not a hobby.

    Quick note on “turnkey”: turnkey is a marketing word. Even the nicest rehab will need something eventually. Budget for it, keep reserves, and expect a short punch list after closing.

    And honestly, this applies to Toledo, Cleveland, Detroit, Memphis, anywhere: your success in any market is driven by your team.

    Toledo can fit your price points (SF under $150k and small multi under $300k), but it's very neighborhood and street specific. The win is pairing a solid acquisition with strong management: screening, lease-up speed, maintenance response, and realistic CapEx on older homes.

    Hope that helps as you weigh Toledo vs other markets.

    0Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    9mo

    @Abdul N.

    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

    [email protected]248-209-6824
    Logical Property Management4.9459 Reviews
    WebsiteView Page
    2Reply
  • Denise SuppleeBusiness Member
    Realtor · Willow Grove, PA · Member since 2017 · 983 posts · 643 votes
    9mo

    Focus first on learning to run the numbers (rents, expenses, cap rate, vacancy, maintenance) so you can compare deals anywhere. Cities like Toledo, Cleveland, Memphis, and Detroit often show solid long-term potential at your price points, but the specific neighborhood and property condition matter more than the city name. Given you want turnkey or light work, build a reliable team early, especially a local agent and property manager you trust, because they’ll be key to finding and evaluating deals you can’t see in person. Start small, execute well, and scale as you gain confidence. If you’re open to feedback and relationships, post specific deal analyses and ask for help with numbers and markets here; people will respond to concrete scenarios.

    Spark Rental Co-Investing Club580 Reviews
    WebsiteView Page
    1Reply
    • Abdul N.
      OP
      Member since 2025 · 11 posts · 19 votes
      9mo
      Quote from @Denise Supplee:

      Focus first on learning to run the numbers (rents, expenses, cap rate, vacancy, maintenance) so you can compare deals anywhere. Cities like Toledo, Cleveland, Memphis, and Detroit often show solid long-term potential at your price points, but the specific neighborhood and property condition matter more than the city name. Given you want turnkey or light work, build a reliable team early, especially a local agent and property manager you trust, because they’ll be key to finding and evaluating deals you can’t see in person. Start small, execute well, and scale as you gain confidence. If you’re open to feedback and relationships, post specific deal analyses and ask for help with numbers and markets here; people will respond to concrete scenarios.


       Thanks for the advice.

      1Reply
  • Kerlous TadresBusiness Member
    Realtor · Columbus, OH · Member since 2023 · 1k+ posts · 1k+ votes
    9mo

    Hey @Abdul N., long-distance works best when you pick one market and go deep, not “anywhere.” I’d recommend Toledo or parts of Cleveland for your price range, but only buy in stable areas near jobs/hospitals so you don’t get crushed by bad tenants and repairs. Before you buy, lock in a strong property manager and use real rent comps plus higher taxes/insurance/repairs in your numbers.

    [email protected]614-490-1163
    Kerlous Tadres | Reafco Real Estate540 Reviews
    WebsiteView Page
    1Reply
    • Abdul N.
      OP
      Member since 2025 · 11 posts · 19 votes
      9mo
      Quote from @Kerlous Tadres:

      Hey @Abdul N., long-distance works best when you pick one market and go deep, not “anywhere.” I’d recommend Toledo or parts of Cleveland for your price range, but only buy in stable areas near jobs/hospitals so you don’t get crushed by bad tenants and repairs. Before you buy, lock in a strong property manager and use real rent comps plus higher taxes/insurance/repairs in your numbers.


       Thanks for the advice. I will keep that in mind.

      0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    9mo
    Quote from @Abdul N.:

    Hi everyone, 

    I am new to the forum would love your guidance. My desire is to invest long distance due to the high prices and suboptimal cashflow in my current city. I’ve heard about Toledo, Cleveland, Memphis, and Detroit being good options but open to invest anywhere in the country as long as the numbers work. My target is single family below 150k or multifamily units below 300k. I’m fine with average cashflow and/or appreciation because I plan to buy and hold long term. I’m also open to mid term rentals. I prefer turnkey property or those that need light cosmetic work. I have a great credit score and have saved up enough money to be able to make down payments and scale up. I am very motivated and would love to work with anyone (realtors, property managers, mentors, fellow investors) who is as motivated and can assist in the process.


     If you're looking at Cleveland you'll want to read The Ultimate Guide to Grading Cleveland Neighborhoods. It was written to familiarize out of state investors with the in's and out's of the market here. There are a lot of risks that you won't know how to identify without it.

    0Reply
  • Lindsay DavisBusiness Member
    Real Estate Broker · Birmingham, AL · Member since 2019 · 326 posts · 203 votes
    9mo

    @Abdul N.,

    Your budget opens up much of the Sunbelt. Apart from Memphis in Tennessee, there are areas like Chattanooga. Places in Alabama like Birmingham (the state’s largest city), Montgomery (the state’s capital), and Huntsville (the fastest-growing metro area in the state) could also be worth looking into.

    I may be biased since I run a turnkey provider that operates in the Southeast, but I agree that turnkey’s probably your best bet if this is your first out-of-state property. A more hands-off approach, at least for your first few deals, will save you the headaches of upfront rehab work and ongoing “landlording.”

    Let me know if you have any specific questions about the turnkey approach—happy to serve as a resource!

    205-205-4118
    Spartan Invest4.8134 Reviews
    WebsiteView Page
    0Reply
  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 938 votes
    9mo

    @Abdul N.

    Midwest has a lot of opportunities for single-family and small multi-family investments, especially if you’re looking for turnkey or light rehab deals. With strong rental demand and affordable entry prices, investors can scale while still getting solid cash flow and long-term appreciation. It’s worth focusing on markets where the numbers make sense and working with local property managers and realtors to make remote investing smoother.

    [email protected]614-418-6081
    0Reply
  • Alfath AhmedBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
    9mo
    Quote from @Abdul N.:

    Hi everyone, 

    I am new to the forum would love your guidance. My desire is to invest long distance due to the high prices and suboptimal cashflow in my current city. I’ve heard about Toledo, Cleveland, Memphis, and Detroit being good options but open to invest anywhere in the country as long as the numbers work. My target is single family below 150k or multifamily units below 300k. I’m fine with average cashflow and/or appreciation because I plan to buy and hold long term. I’m also open to mid term rentals. I prefer turnkey property or those that need light cosmetic work. I have a great credit score and have saved up enough money to be able to make down payments and scale up. I am very motivated and would love to work with anyone (realtors, property managers, mentors, fellow investors) who is as motivated and can assist in the process.


     You should just buy 2-4 units in cleveland. You can find those for about $150k and they will bring in about $1,700 to $1,900/mo gross. Usually, they comp out around $180k to $190k. 

    [email protected]614-802-5698
    ReafCo | Ahmed Group 536 Reviews
    WebsiteView Page
    0Reply
  • Trey Maclin
    Property Manager · Eastern Region, US · Member since 2023 · 39 posts · 16 votes
    8mo
    Quote from @Abdul N.:

    Hi everyone, 

    I am new to the forum would love your guidance. My desire is to invest long distance due to the high prices and suboptimal cashflow in my current city. I’ve heard about Toledo, Cleveland, Memphis, and Detroit being good options but open to invest anywhere in the country as long as the numbers work. My target is single family below 150k or multifamily units below 300k. I’m fine with average cashflow and/or appreciation because I plan to buy and hold long term. I’m also open to mid term rentals. I prefer turnkey property or those that need light cosmetic work. I have a great credit score and have saved up enough money to be able to make down payments and scale up. I am very motivated and would love to work with anyone (realtors, property managers, mentors, fellow investors) who is as motivated and can assist in the process.


     HI Abdul! 

    You’re asking some good questions for an out-of-state buy-and-hold approach. At a high level, the markets you mentioned (Toledo, Cleveland, Memphis, Detroit) all can work, but they work for different reasons, and the details matter a lot at your price points.

    A few high-level observations from what I and my team see across markets:

    • Detroit / Cleveland / Toledo – These are very neighborhood-specific plays. The numbers can absolutely pencil on sub-$150k SFRs, but success hinges on micro-location, housing stock quality, and realistic rent assumptions. Turnkey vs. “light cosmetic” can mean very different things here depending on age of home and prior rehab quality. In these cities, don't think it terms of zip code, but in terms of blocks and their local appeal. Things can change within a stone's throw. 

    • Memphis – Often easier to hit cash flow targets, but insurance, taxes, and tenant turnover assumptions need to be conservative. It’s a market where management quality has an outsized impact on outcomes. Not much room for mistakes in Memphis. 

    • Turnkey vs light value-add – For remote owners, true turnkey tends to reduce surprises but often compresses returns. Light cosmetic work can improve yields, but only if you have very tight scope control and boots-on-the-ground accountability.

    • Mid-term rentals – Viable in some pockets, but zoning, seasonality, and furnishing costs matter more than most people initially expect. It’s usually best as a deliberate strategy rather than a fallback option.

    Broadly speaking, long-distance investing works best when you:

    1. Lock in a very clear buy box

    2. Underwrite conservatively on rents and expenses

    3. Lean on local insight for street-by-street differences -you should be the main remote party in this equation. 

    4. Optimize for operational stability instead of "just purchase price"

    Your budget and long-term hold mindset are reasonable, the kEy will be narrowing markets and neighborhoods where your risk profile, management expectations, and return goals actually align.

    Happy to see you digging in early and asking before jumping. I work in both management and helping new investors in all of these markets, always happy to dive in deeper on market knowledge via DM. 

    0Reply
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