Long Distance Investing - How Do You Trust People???

Question

Hello! I'm a NEW long-distance out-of-state investor from Canada. My future properties will need local contractors and property managers to do the work. I might never see them, their work, or my property in person. This is risky and intimidating especially for a newbie.

David Greene's book Long Distance Real Estate Investing says it's possible. It says one of the best way to mitigate risk is to require video/picture proof of rehab work and get referrals/references for everyone you work with. But even so, there's still risk and uncertainty.

My question is:1) How do you get over the mental hurdle of trusting someone else will do a good job without you being there in person?2) Can you share any long distance investing tips?Speaking of finding quality people, if you know any good people in Texas, please let me know.https://www.biggerpockets.com/forums/12/topics/801192-long-distance-investor-looking-for-partnerships-in-dallas-txTHANK YOU SO MUCH EVERYONE!!!

Nathan Gesner · Answer

Even if you lived right next door and looked the contractor in the eye, there's risk involved. You can misunderstand what he says, misread body language, miscommunicate, etc.

The only way I know is to really screen them up front. Once you've settled on someone, make sure your expectations are clearly understood and agreed to (e.g. I want pictures of before/after on every job before I will send payment). Then communicate those expectations again when the job comes up (e.g. "John, don't forget that I'll need pictures of the floor damage before you start working and then some pictures of the finished project. If you're able, a one minute video conference would be even better.")

You're going to have to train them. Some contractors may already do this and it will be easy. Stay on them until you've developed a relationship and a level of trust.

Long Distance Investing - How Do You Trust People???

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