Newbie - Wants to know about Investing In Oklahoma

Sam Rane · 2021-09-29T10:31:19-07:00

Hello Everyone,I'm new to this forum and new to investing. a little bit about me, i'm 38 years old male married no kids, I currently live in NC and i am looking at diving into Oklahoma housing market but i'm not sure where to start exactly. I wanted to know which option would be best for someone like me "a Newbie" and how to actually get started in Real Estate? Should i get a Single Family House (3 bed 2 bath) as a 1st property and rent it out OR get a Duplex ? I'm looking for cash flow and gradual appreciation or maybe mix of the two. My goal is to start small like invest into home/s between 80k-100k and grow my portfolio...Some of the questions i have are:1. is the Oklahoma real estate market promising ?2. Is it risky/or safe for someone out of state to invest in Oklahoma ?3. Where in Oklahoma should i start looking for houses under 100k ? Name of cities/or Town?4. Is it easy to rent the property in Oklahoma? 5. Do i need to own an LLC ?6. Do i need to hire a PM to handle the property ? Any comments/help is appreciate it, thank you all!Sam

Scott Swanson

Griffith, IN · Member since 2019 · 114 posts · 56 votes

5y

Sam,

What is your reason for wanting to invest in Oklahoma and not where you live? Have you considered other markets besides Oklahoma? I can't answer all of your questions, because I don't know the Oklahoma market, but I can answer a few:

2. Is it risky/or safe for someone out of state to invest in Oklahoma ? Investing out of state is always risky. That doesn't mean it can't be done. You need solid "boots on the ground" to invest out of state. Without them, you're toast. You need a quality handyman crew and/or a quality contractor for rehabbing and/or fixing issues that come up. Someone has to live in the area to maintain the property or fix problems that arise. You also need a quality property manager as well. I tell investors that you can buy the best deal on Earth, but if you don't have solid property management, you have NOTHING. A bad tenant can take your profits down in a heartbeat! So make sure you have a solid team. It took me over a year to find a quality, honest and fair priced contractor. Having a solid and competent realtor that deals with investors, is also a very good idea. They know the market and can help guide you on where to buy.

5. Do i need to own an LLC ? No, not for the initial purchase. I'm NOT an attorney, but my suggestion is, that you put the property into an LLC; sooner than later. This will protect your personal assets, should something major arise. You can put the property into an LLC at any time.

6. Do i need to hire a PM to handle the property ? I strongly suggest you get a PM, (property manager). It's difficult to manage from a distance. PM's typically have handymen that can fix small problems that might come up. But be sure to ask them about how much they charge and what their procedures are, when something comes up. I don't know what fee they charge in Oklahoma, but in the Illinois market, we're between 8 and 10% of the rent.

We have investors from all over the country, only because we provide them with the boots on the ground they need, to invest out of their state. See if you can find a solid company that does that, in the area you're looking to buy. I would also suggest that you stay under maybe $100k for your first purchase. Get your feet wet and learn the business and how it actually works. Then once you have experience, you might want to "step up." I don't know the prices of duplexes out there. But in our area, we can get them for $110k or less.The rents are typically higher than an sfr, but so is the maintenance and in particular, the rehab costs. You need to take those costs into consideration before buying. Also with a duplex, you may need to hire someone for lawn maintenance, snow removal and garbage pick up. Those costs all add up. However, some investors give one of the tenants a break on their rent, in return for snow removal and lawn maintenance. A PM company may be able to provide those services as well. Unless it's different in Oklahoma, typically, the landlord pays for the water on a duplex, so keep that in mind.

I hope this helps and good luck.

1 Reply

Sam Rane

OP

Member since 2021 · 4 posts · 3 votes

5y

@Scott Swanson Thank you so much for your input very insightful.

0 Reply

Lara White

Rental Property Investor · Oklahoma City, OK · Member since 2020 · 309 posts · 184 votes

5y

@Sam Rane Hi Sam! 1 & 2) I personally love the Oklahoma market lol! But seriously, like @Scott Swanson said, any OOS investing has risks (heck for that matter something next door to you will too, but you know that), but having good contacts helps mitigate the risk.

3) Under $100K...that's tough, you'll probably have to go outside of the major metros. Rents and rehab will be your challenge. How much do you have for rehab? Do you want a major rehab? If not, I would raise your min price range a little bit. It's so subjective (what someone considers major vs light rehab, and the areas you could buy in) that it's hard to nail down a specific number for you on that without narrowing down several things.

4) Depends on where you are looking. What type of renter are you targeting? College student? Military (we have several bases here)? Family looking to get in to a good school zone? Downtown denizen? Condos, Apartments, SFR?

5)If you do get an LLC (I am NOT an attorney, please consult your attorney for advice), look into getting one that is registered in Oklahoma. There were a couple of BP podcasts recently that covered LLC's, look them up and listen. That guy was an attorney and had great advice!

6) If you are not going to self-manage - yes you need a PM. I have a few that I can give you if you want to call them and see what they offer.

Welcome to the BP Forums! What makes Oklahoma interesting to you? Do you have a connection here, or just looking at different areas and we popped up? Set up some keyword alerts on here to notify you of topics you are interested in (for example: LLCs, newbie, property manager, Oklahoma). Good luck!

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Doug Spence

Investor · San Diego, CA · Member since 2016 · 1k+ posts · 975 votes

5y

@Sam Rane My answer to all 6 of your questions is: it depends.

Many of your questions are addressed in two of my favorite real estate books, both authored by the legendary @david greene. "Long-Distance Real Estate Investing" and the "BRRRR" book. That being said, he's not going to answer these questions for you, you're going to need to do a lot of digging and soul-searching to find the right answers for you. People on forums can't possibly answer all of these questions for you and your personal situation.

For example, "1. is the Oklahoma real estate market promising". This is such a subjective question and the state of Oklahoma has so many markets and submarkets with different political climates, economic drivers, and much much more. Every market has some potential, and there are deals to be had and money to be made in darn near every market.

If there was a black and white playbook with simple answers to every question, everyone would be rich from real estate.

Good luck on your journey, welcome to Bigger Pockets, and keep us updated on your progress!

3 Reply

Jimmy Ogle

Investor · Oklahoma City and Tulsa, OK · Member since 2014 · 111 posts · 45 votes

5y

@Sam Rane my first question for you would be why not invest in your backyard? Not saying Oklahoma isn't great because I believe it is as we are heavily invested in the OK market but sometimes the grass isn't always greener on the other side. Do you feel rentals don't make since where you are?

If you ever need anything or want to chat about the Oklahoma market feel free to reach out anytime!

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Newbie - Wants to know about Investing In Oklahoma

Newbie - Wants to know about Investing In Oklahoma

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