Chris from San Francisco, CA

21 Replies

Hi everyone, I'm excited to finally be a part of the community! I'm a 26-year-old living in San Francisco and working as a software engineer. A couple months ago, I got hooked on the idea of real estate investing and have spent hours reading books and listening to the BP podcast. Now, I'm finally ready to take the first step.

I've had my money just sitting in a savings account doing nothing the past few years and it's time to put it to work. I'm planning to buy and hold an out-of-state property within the next couple months (thanks to David Greene's awesome book). Currently, I'm looking for properties in Fort Worth and Oklahoma City, but I'd love some suggestions and advice.


I'm looking to do a 20% down payment on a 30-year fixed-rated conventional mortgage to buy a SFR and rent it out. I have $60,000 saved up, so I'm thinking of getting a house around $150,000 to $200,000 to have reserves leftover for when things go wrong. I'm hopeful that the first property will go well, but I completely understand that this is a learning process and I plan on learning from my mistakes along the way. The things I learn from my first deal will far outweigh any of the money I make from it.


Looking forward to meeting you all!

@Chris Yung killer plan, Chris! Plan to put 25% down on the home (will be required by most (possibly all) lenders for a non-owner occupied investment home. That will give you some stellar equity AND put your tenants payments working hard on your debt pay down!

Yours in OKC,

Will Fraser

@Chris Yung

Fabulous first steps Chris and congratulations! I would highly recommend getting pre-approved with a lender first. I have a lender that's helped me acquire 4 properties out of state and if it's a SFR they only require 20% and you won't pay any PMI. Give strong consideration to flying out to the area you want to purchase in at least once. i flew out to Ohio a couple of times before I started buying in Cleveland.

@Chris Yung

I would consider finding a property that you can also force appreciation on, by making some improvements and then cashing out on the property after 6 months to have some money to purchase the next property. You can go as low as 15% down on a SFR but less than 20% down does require mortgage insurance.

@Brian Garlington Thanks for the tip! I'm planning to get pre-approved shortly. I also booked tickets to fly out to DFW next month to have a closer look at the neighborhoods.

 @Jerry Padilla Agreed! I'm keeping an eye out for properties that require some cosmetic repairs and adding some forced appreciation.

@Will Fraser That's good to know. I didn't consider that lenders may require 25% down payment for non-owner occupied investment homes.

I would suggest checking out the Columbus, Ohio market. We are getting a lot of interest from out-of-state investors. There are a bunch of deals waiting to get bought up!

Welcome @Chris Yung I think you can meet that criteria in one of any dozen Midwestern markets...have you thought about your real motivation for investing and what type of an investment lets you reach your goals the quickest...and lets you sleep at night?...you can find unreal cash flow in Cleveland, Indy, and maybe Kansas City...and stability in metro areas like Columbus. 

@Chris Yung

That's great! I always think about how I can add value rather than buy cash flow. You can buy cash flow anywhere but adding value is the special power of RE, in my opinion. Also maybe find a good market with 2-4 unit props rather than SFH. MF just generate so much more income than a SFH. You'll find plenty of folks on here selling overall markets. Make you really look closely at the submarket where ever you buy.

Fort Worth is a great long term play. With all the corporate relocation here the demand for homes should stay strong for quite some time. You may want to focus on the Far North Fort Worth area. North of Loop 820 along either side of I-35W Hwy 287, Hwy 170 and Hwy 114. There are many homes built in the late 1980's closer to 820. But for lower maintenance reasons you may want to focus on the homes built in the early 2000's and newer. These have great demand due to the Northwest and Keller school districts. Google Alliance Texas. The job growth is rock star. 

Good luck & great first steps! How are you planning to hold these properties? In your personal name? Through an LLC?

I see good deals in OKC and also agree with others here that the Midwest has great opportunities for cash flow.
Choose your market based on your personal goals & criteria - appreciation/cash-flow/demographics/employment etc.

The beauty of REI is that everyone can find a market and property that works for them - the hardest part when starting is figuring out what will work for you!

@Brandon Sturgill Thanks for the other market suggestions! I'm looking to slowly replace my income from my day job so that I can work on what I want to 10~ years down the road.

@Lee Ripma Agreed! I'll definitely do due diligence when looking at markets. MFR is promising and I plan to do it eventually (maybe the next deal). My thinking for doing SFR first was to minimize the amount of variables that can go wrong, but I'm always open to suggestions.

@Kyle Mccaw Thanks for sharing your knowledge on the area! I'm visiting DFW next month and will definitely take a look at the neighborhoods you mentioned.

@Nick Karni Starting off, I plan on holding them in my personal name with an umbrella policy. Later down the road, I'll form a LLC once I have more properties, but I don't think it makes much sense in the beginning given the $800 yearly fee in California.

Originally posted by @Chris Yung :
Hi everyone, I'm excited to finally be a part of the community! I'm a 26-year-old living in San Francisco and working as a software engineer. A couple months ago, I got hooked on the idea of real estate investing and have spent hours reading books and listening to the BP podcast. Now, I'm finally ready to take the first step.

I've had my money just sitting in a savings account doing nothing the past few years and it's time to put it to work. I'm planning to buy and hold an out-of-state property within the next couple months (thanks to David Greene's awesome book). Currently, I'm looking for properties in Fort Worth and Oklahoma City, but I'd love some suggestions and advice.


I'm looking to do a 20% down payment on a 30-year fixed-rated conventional mortgage to buy a SFR and rent it out. I have $60,000 saved up, so I'm thinking of getting a house around $150,000 to $200,000 to have reserves leftover for when things go wrong. I'm hopeful that the first property will go well, but I completely understand that this is a learning process and I plan on learning from my mistakes along the way. The things I learn from my first deal will far outweigh any of the money I make from it.


Looking forward to meeting you all!

 Hey Chris welcome to the site. Lots of investors are in a similar position as yourself and they look to the turnkey markets as well. Tons of turnkey markets out there. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. In no particular order I have listed some of the most popular markets for out of state investors

  • Cleveland, Ohio
  • Dayton, Ohio
  • Toledo, Ohio
  • Youngstown, Ohio
  • Cincinnati, Ohio
  • Memphis, Tennessee
  • Birmingham, Alabama
  • Kansas City, Missouri
  • Saint Louis, Missouri
  • Indianapolis, Indiana
  • Detroit, Michigan
  • Erie, Pennsylvania
  • Louisville, Kentucky
  • Milwaukee, Wisconsin
  • Jackson, Mississippi

Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.

One thing to note when looking at the individual markets, you can make or loose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.

  • Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
  • Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
  • Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
  • Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
  • Make sure your property manager is a licensed real estate brokerage.
  • Understand you can not eliminate all risk, only mitigate it. If you are risk adverse real estate, (especially out of state) is not for you.
Originally posted by @Chris Yung :
Hi everyone, I'm excited to finally be a part of the community! I'm a 26-year-old living in San Francisco and working as a software engineer. A couple months ago, I got hooked on the idea of real estate investing and have spent hours reading books and listening to the BP podcast. Now, I'm finally ready to take the first step.

I've had my money just sitting in a savings account doing nothing the past few years and it's time to put it to work. I'm planning to buy and hold an out-of-state property within the next couple months (thanks to David Greene's awesome book). Currently, I'm looking for properties in Fort Worth and Oklahoma City, but I'd love some suggestions and advice.


I'm looking to do a 20% down payment on a 30-year fixed-rated conventional mortgage to buy a SFR and rent it out. I have $60,000 saved up, so I'm thinking of getting a house around $150,000 to $200,000 to have reserves leftover for when things go wrong. I'm hopeful that the first property will go well, but I completely understand that this is a learning process and I plan on learning from my mistakes along the way. The things I learn from my first deal will far outweigh any of the money I make from it.


Looking forward to meeting you all!

 Hello and welcome! Best of luck to you! 

@Chris Backer in the OKC market I wouldn't buy properties over 120k. We're extremely recession-proof in B and C class areas. In the last downturn, other markets saw 20% drops in property values when we saw an average of close to 6%. However, our luxury markets do take a hit, especially to rent rate. You'd never guess, but here over $150k and you're treading into that territory. 

What happens here are that builders get nervous in a downturn and lenders start tightening up on what they're owed. Builders can't sell their properties but need to make payments, so they start trying to rent them out as quickly as possible. What do you think happens to the rent rate you're able to acquire on your 10 year old property that's 2 miles from brand new construction that's being leased for less per month than what you planned on getting! 

B class is great here and you can find good deals with 7% cap rates. C class has even less competition as far as cosmetic expectations (most of the deals I've seen in the last year need no rehab and get market rent rates) and cash flows even more! 60-80k and you can be in a C class home that makes you $150/month after all expenses (budgeting for maintenance, vacancy, property management) and of course paying your debt service!  

Originally posted by @Kiera Underwood :

in the OKC market I wouldn't buy properties over 120k. We're extremely recession-proof in B and C class areas. In the last downturn, other markets saw 20% drops in property values when we saw an average of close to 6%. However, our luxury markets do take a hit, especially to rent rate. You'd never guess, but here over $150k and you're treading into that territory. 

What happens here are that builders get nervous in a downturn and lenders start tightening up on what they're owed. Builders can't sell their properties but need to make payments, so they start trying to rent them out as quickly as possible. What do you think happens to the rent rate you're able to acquire on your 10 year old property that's 2 miles from brand new construction that's being leased for less per month than what you planned on getting! 

B class is great here and you can find good deals with 7% cap rates. C class has even less competition as far as cosmetic expectations (most of the deals I've seen in the last year need no rehab and get market rent rates) and cash flows even more! 60-80k and you can be in a C class home that makes you $150/month after all expenses (budgeting for maintenance, vacancy, property management) and of course paying your debt service!  

Hi there @Kiera Underwood, I don't believe you meant to tag me but in any case the guidance you give is sound and where I have been focused.  In fact, I have seen a little better returns e.g. 9-10% cap rates in the 60-80K range, OKC Metro Area.  We should connect at some point and determine if there is an opportunity to work together. 

@James Wise Thanks for the suggestions! I'll take your advice and start off with a B-class neighborhood to minimize the headache factor for my first deal. I'll be sure to do as much due diligence as possible, but understand that there's always a certain amount of risk involved.

@Kiera Underwood I appreciate the market knowledge regarding OKC. I plan to avoid the luxury markets since those tend to take a hit first as you said.

@Remington Lyman hey man! Hit me with any deals you come across that are no brainers!

Specifically I love single-family, duplexes, and four Plexes that fit the Burr paradigm, but I’m also open to small multi families and laundromats.

Thanks for being a leader in the Columbus market!

@Chris Backer haha I did not mean to tag you! But glad you're looped into a relevant conversation. I've seen 9-10% cap rates in high-risk areas or when the seller is compensating for condition, as-is deal then sure. 8% are typical for a decent house that doesn't need rehab. Cash flow from day one type stuff! 

@Chris Yung glad to hear it! I've got a map but no way to upload right now. It shows what caps/price points to associate with what areas. 

@Chris Yung The first thing I recommend is establishing a clear objective before choosing a market. Your objective and criteria should drive your choice of market. Some markets will suit your goals better than others. 

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