investing in remote town

[Martin Pelletier]

there is some plex sale by the police at very low cost that I can pay cash or with a very small mortgage. A lot of them need to be renovate. There is also a lot of plex in small town at low cost too but still ready to rent. What is your experience with far away rental from where you live? Does it worth buying or I might just deal with a lot of trouble? 

[Curt Smith]

Hi Martin, I have experience in your topic...  I'm assuming you will be renting that inventory once rehabbed.

Start by reading my Bullet Proof Portfolio paper linked off my profile.  My attempt to package up a full business model for buying and managing an easy to manage profitable rental portfolio.  Landlording starts with the customer in mind, the customer the capital asset is not the house its the tenant!!

Good tenants need good jobs for in the end for your rental business to be both easy to manage and profitable.  I know first hand the importants of buying ONLY where there are growing jobs.  Not just available jobs but growing good jobs.  IE has an amazon distribution center set up shop nearby, manufacturing or warehousing recently come to town?   Google is your friend.  Scan the webpage of the local papers, business paper.  Call the chamber ask about new employers.

Tip:  use indeed.com set radius to 5 mi, search for jobs in the target city, then other same sized cities, noting the the number of jobs in upper right.   Search cities you know for a fact have new employers coming to town.  Ratio those jobs per 1k population and normalize the smaller town jobs per 1k.   Now you have a data base of what does your local good jobs vs ok vs bad jobs towns jobs/1k pop looks like.   

Avoid cities with poor num of jobs!!   Cheap houses in bad cities are bad deals.  I'm finally dumping at astoundingly low prices a few of our bad purchases after struggling for years with eviction after eviction of folks who could not continue over time make rent.  Weak towns also have a huge drug use problem!!!!  Don';t under estimate the problem of drugs and inability to keep a job in small towns.   I speak from experience.

But...  a growing town, growing good jobs attract good tenant types;   dual income young families with a dog.  All my houses have or I put in a chain link fenced yard (smallish).  Dogs are an anchor for keeping good families staying put as well as keeping the kids in the same school.  Good local schools is great but for blue collar tenants its good jobs that are the basic ingredient for a successful rental business.