Newbies Getting started (out of country)

22 Replies

Hello, my name is MaryAnne my husband and I have decided we want to start investing in real estate. My husband is active duty Air Force and we are currently stationed in Japan, and I am a stay at home mom (both of our girls are currently in school ages 9 & 6). Since the girls are back in school I have more time on my hands, so when I am not at the gym I am educating myself as much as I can on how we can start this new chapter in our lives! 

My husband and I have both started to read several books, watch/attend online webinars and analyze houses everyday. I love working with numbers, so analyzing houses is what I really hope to become an expert at. We only have about $20,000 currently to get started, so as you can see I have more time then money to start. We are really interested in rentals for single family and multi family homes. What we are stuck on is finding the right location to get started. 

Tips from various sources and what they say about getting started with investing, and tips to consider when buying outside of your area: 

1. Look at your current location (right now, that doesn’t work for us)

2. Look at where you grew up, this gives you a place that you are familiar with along with the possibilities of already having connections in that area. ( My husband is from a very small town in PA and I am from northern IN)

3. Places we have been stationed at (Rapid City SD, Colorado Springs CO, Dover DE)

4. Look at the Employment Growth, Population Growth, Increase in home values, and Rental yield for cities your considering investing in 

I have started to educated myself on places but can’t seem to convince myself the information I have found is enough to go off of. We have also considered turn key rentals (but the numbers are not what we want, yet). We have also looked at other military bases, other then the ones we have been stationed at and considered those areas as possible investment opportunities. 

A list of places we have considered:

-Indianapolis IN (3 hours south of my home town)

-Dover DE but the housing market doesn’t seem to be increasing

-Colorado Springs, we may find it difficult since we don’t have much money to start off with and it is very competitive from the research I have done

- Homes near Whiteman AFB in MO, I have read a lot about Kansas City MO and the growth. 

-Waco Texas, & San Antonio

-Charleston SC

I am looking for any more tips, tricks, or suggestions to help us understand the market better so we make great choices. Based on the places I have listed, am I understanding the market correctly and looking at the right places? How would you decide where to invest in if you were in our situation? Once we pick a location then do we contact an agent, or can an agent find houses outside of the state they live in? Would it be beneficial for me to become an agent? 

Any other helpful information is welcome. Thank you so much in advance.

MaryAnne

@Maryanna, I just finished writing an article about investing from overseas, and I'll try and remember to let you know when it is edited and posted.

From what you said, and your home being in Indiana, I would say Indianapolis warrants some further scrutiny. I don't invest there, but I know several people that do, and have done quite well doing so.

I always suggest learning and networking as much as possible when starting out, and it sounds as though you've already got a pretty solid handle on that! Let me know how I can help!

@MaryAnne Burrows - here's another consideration:  Where do you have or could you establish a team you can trust?  Ever read @David Greene 's book about long-distance real estate investing (called "Long-Distance Real Estate Investing")?  He focuses heavily on the team that you're going to need to establish as your boots on the ground (GC, attorney, property manager, etc.).

I'm not saying having the team in place is a pre-requisite to determining where to invest, but it certainly can help.  It can give you a leg up, so to speak, if you already have a good GC in Charleston or you have a bunch of buddies in Missouri who can swing by a potential property for you to take a look at it.

The Larkin-Emmons Group, LLC (my company) invests in Central New York. It's not because of ANY of the factors listed (no appreciation, job market slowly shrinking, people moving out, etc.), but it works for us because I grew up there, understand it, and have people I can rely on in the area as part of our team. Nobody can pull the wool over my eyes about the place, since I have special familiarity with it.

As for Colorado Springs, that's where I currently live.  Great market.  Fantastic.  Expensive and competitive.  But with the right deal you can leverage hard money or alternate means to make the margins work.  Just something to think about.  Don't get analysis by paralysis, but a lot of people have a kind of investment philosophy like "I want to be the biggest fish in the small pond" or, alternately, "I want to show I'm the meanest, fiercest, strongest jaguar in the jungle, so let me at the competition."  Nothing wrong with either and lots of people find what works for them.

Feel free to DM me if you want any other info on Colorado Springs, investing in the military (I'm Active Duty Army, Hooah, etc. etc.), or any other topic you can think of that you might want to explore (like AirBnB properties or whatever) that I might know a little about.

Updated almost 2 years ago

*paralysis by analysis

Originally posted by @MaryAnne Burrows :

Hello, my name is MaryAnne my husband and I have decided we want to start investing in real estate. My husband is active duty Air Force and we are currently stationed in Japan, and I am a stay at home mom (both of our girls are currently in school ages 9 & 6). Since the girls are back in school I have more time on my hands, so when I am not at the gym I am educating myself as much as I can on how we can start this new chapter in our lives! 

My husband and I have both started to read several books, watch/attend online webinars and analyze houses everyday. I love working with numbers, so analyzing houses is what I really hope to become an expert at. We only have about $20,000 currently to get started, so as you can see I have more time then money to start. We are really interested in rentals for single family and multi family homes. What we are stuck on is finding the right location to get started. 

Tips from various sources and what they say about getting started with investing, and tips to consider when buying outside of your area: 

1. Look at your current location (right now, that doesn’t work for us)

2. Look at where you grew up, this gives you a place that you are familiar with along with the possibilities of already having connections in that area. ( My husband is from a very small town in PA and I am from northern IN)

3. Places we have been stationed at (Rapid City SD, Colorado Springs CO, Dover DE)

4. Look at the Employment Growth, Population Growth, Increase in home values, and Rental yield for cities your considering investing in 

I have started to educated myself on places but can’t seem to convince myself the information I have found is enough to go off of. We have also considered turn key rentals (but the numbers are not what we want, yet). We have also looked at other military bases, other then the ones we have been stationed at and considered those areas as possible investment opportunities. 

A list of places we have considered:

-Indianapolis IN (3 hours south of my home town)

-Dover DE but the housing market doesn’t seem to be increasing

-Colorado Springs, we may find it difficult since we don’t have much money to start off with and it is very competitive from the research I have done

- Homes near Whiteman AFB in MO, I have read a lot about Kansas City MO and the growth. 

-Waco Texas, & San Antonio

-Charleston SC

I am looking for any more tips, tricks, or suggestions to help us understand the market better so we make great choices. Based on the places I have listed, am I understanding the market correctly and looking at the right places? How would you decide where to invest in if you were in our situation? Once we pick a location then do we contact an agent, or can an agent find houses outside of the state they live in? Would it be beneficial for me to become an agent? 

Any other helpful information is welcome. Thank you so much in advance.

MaryAnne

Welcome to the site MaryAnne. 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.

 

@David Pere Thank you for responding to my post and offering to help if we have questions. I will make a note to keep an eye out for your article. In regards to investing in Indiana, I am from the South Bend area which is roughly three hours north of Indianapolis, should I focus closer to the South Bend area to start? We have enjoyed your YouTube videos, you had mentioned that you were stationed in Okinawa, that is were we are right now!

@Mindy Jensen Thank you for responding to my post, and referencing the Podcast interview with Rich Carey. My husband will actually be going to Alabama at the beginning of the year for a class and we some some great friends stationed at Maxwell, we may consider it a place to look into. 

MaryAnne,  I am retired Navy and contractor in Okinawa. I am getting ready close on my second house in Fort Wayne. My sister is there helping me find the houses that fits with my plans and to make sure I do not buy a house I will regret later. So in my case I truly believe in having boots on the ground that are looking after your best interest. 

There is a Okinawa Real Estate Investors Group on Facebook. They meet once a month.


@Thadeous Larkin Thank you for responding to my post. We are still putting together our list of who we would consider to be part of our “team”. We have ordered the Long Distance Real Estate book, just waiting for it to be delivered! I thought there was an episode on the Podcast with David Greene but I am not having much luck finding it. Thank you for giving us something’s to think about and to consider when it comes to building a team and focusing on an area. Also, thank you for willing to help us out if we have more questions. We have read a lot about and have heard Brandon Turner mention the “paralysis by analysis,” and we are making sure that doesn’t happen to us. 

@James Wise Thank you so much for responding to my post. Being new to this I find that it can be easy to over complicate things, especially since we are still learning and things are new to us. I appreciate all the great tips,  there is only one I don’t understand. “Make sure your property manager is a licensed real estate brokerage.” Why do they need to be a real estate broker? I will have to be sure to listen to the Podcast that you were a guest on! 

@Victor Taflinger Thank you for the response to my post. I am from such a large family that my husband and I need to consider asking my brothers and sisters for help when it comes to networking back in Indiana. That is great to know about the group here in Okinawa, we will have to check it out. 

Originally posted by @MaryAnne Burrows :

@James Wise Thank you so much for responding to my post. Being new to this I find that it can be easy to over complicate things, especially since we are still learning and things are new to us. I appreciate all the great tips,  there is only one I don’t understand. “Make sure your property manager is a licensed real estate brokerage.” Why do they need to be a real estate broker? I will have to be sure to listen to the Podcast that you were a guest on! 

This is super important. For starters it's illegal in almost all 50 states to manage property 3rd party without being licensed. So obviously someone running an illegal operation is reason in itself not to work with them. Beyond that the reasons for that law are important. The general public needs a governing body to oversee this stuff to protect the public's interests. Ya see, when you are property management company millions and millions of dollars flow in & out of your hands all the time.

Each state has a Division of Real Estate who oversees broker operations & requires broker's to adhere to incredibly strict accounting procedures, audits and care of all of this money that flows in & out of their hands that is that of the client's (you) or the tenant's. Think earnest money, rents before they are disbursed to the client (you) & tenant's security deposits. It adds up quickly. Hell at any given point & time I believe there is between $1 million & $1.5 million in my trust account. That money isn't mine. It's client's (you) & tenant's money. Can't just have any Joe off the street make a website & then put um in charge of that kind of money, it would be disastrous. For example to become a licensed broker where I operate (Ohio) you need to go through government background checks, have worked in real estate as a sales agent under another broker for at least 2 years, have a college degree, have a physical store front with office hours, have done at least 40 transactions and much more that I can't think of off the top of my head right now. All of this provides the public with more protection against major theft or loss of funds.

@MaryAnne Burrows

What @Thadeous Larkin said about building the team is important. There’s lots of markets that meet the criteria for cashflow, but you must be able to find the right people. You’ll hear people talk about their “boots on the ground.” This is a local person that can drive out to the properties, go inside, and give you the real story on the property. 

For me it’s a real estate agent that works with out of state investors as his niche. It could be a business partner, family member that knows what they’re doing, contractor you have a good relationship with etc.

Finding a person willing to do this for me was hard. It probably took me a solid 8 months of networking before I found someone reliable. It’s all about creating win-win situations. You scratch my back, I’ll stratch yours. 


Hi @MaryAnne Burrows , I am investing in Indianapolis from out of state. I was able to help a friend get his first house for about $24k. I don't sell anything, I was just assisting him. He purchased at the beginning of August, did the rehab and has already had a tenant in it for a few weeks. He was a total newb and now he has his first rental and is just waiting to do a cash out refi to pull his money out and do it again. 

If you want to talk about it let me know. 

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