Out of state boots on the ground

BRRRR - Buy, Rehab, Rent, Refinance, Repeat
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Out of state boots on the ground

Tyson Thurman
New to Real Estate · Los Angeles County, CA · Member since 2021 · 37 posts · 10 votes

Hi all, how did you assemble your team when approaching an out of state market using the BRRRR strategy? Did you start with a realtor and build the team the same way you would build it if you were local? Or are there specific differences in how I should start building a team in my target market? I have a few markets in mind that I'd like to pursue but just want to make sure I am taking the proper steps in building a trustworthy team out of state. I also am not sure if I should still be targeting properties on the MLS when searching for these deals out of state or if my boots on the ground will be able to help me locate properties fitting the BRRRR strategy a bit better? Thanks so much.

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Lara White
Rental Property Investor · Oklahoma City, OK · Member since 2020 · 309 posts · 184 votes
5y

@Tyson Thurman After you narrow down your market (or markets), I would definitely start with a realtor (or two). They can set you up on the MLS for free, and go take video or do facetime with you (that's what I do with my clients) to help explore the property and the street that it's on. The realtors should also have some vendor contacts that will give you a leg up on getting some bids/ideas of cost. Be sure to interview the realtor though...most of them have little to NO idea about investing!! Good luck to you. What markets are you looking in so far?

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  • Lara White
    Rental Property Investor · Oklahoma City, OK · Member since 2020 · 309 posts · 184 votes
    5y

    @Melanie Murphy  My anxiety level just shot through the roof. LOL.   1% rule here in Oklahoma....   There are so many factors that go into what makes a property worthwhile (or not!), that I rarely focus on just one rule (like the 1%).  The OKC Metro market spans almost 2 hours across from east to west and about the same from north to south.  That's a LOT of different types of areas and properties. Also, if you are basing your purchase on the 1% rule today for a property....what will it be at in 1 yr from now... or 5 yrs from now.... will it still be 1%?  I can't tell you that. Rents aren't set in stone (yes, hopefully they will go up...but what happens if they don't).  The $100,000 property you buy here, will probably need at least light renovation, and will probably not get $1000/mo rent.  But that doesn't mean it's not a good deal.

    Second question: What kind of price points for investors ...well that isn't an easy answer either... investors come in all sorts of shapes and sizes (not trying to be snarky!!) - I have some investors that are strictly looking for the $100,000-200,000 range (single family/maybe duplex) and then some who are looking for anything up to $800,000 (multi families units) - those properties are as different as night and day. What kind of property are you looking for? Single Family? duplex? Tri? Turn-key? Something to BRRR? STR? Will you self-manage, or use a PM?

    Overall, I do think the Oklahoma market has a lot of great properties, we have a great employment base with lots of solid employers (from military, state government, energy, universities).

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  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    5y

    Who has more vested interest in a landlord doing well, an agent or a property management company?

    The agent sells the landlord a property and can disappear. 

    A PMC has to manage the property until the landlord fires them or sells the property.

    [email protected]248-209-6824
    Logical Property Management4.9460 Reviews
    WebsiteView Page
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  • Bonnie LowPro Member
    Lender · Asheville, NC · Member since 2016 · 1k+ posts · 1k+ votes
    5y

    @Tyson Thurman be careful pursuing the BRRRR strategy in Toledo. We are experienced BRRRR investors and understand construction processes and costs well (in CA). It's always tricky because you have to know how to run the numbers for your construction costs, holding costs, and be really confident in your ARV. While we're looking at Toledo for buy and hold properties and cash flow, the ARV is what is holding us back in much of Toledo when it comes to BRRRR. The value just isn't there and even if it is, it's unclear if it's an anomaly or if the higher market values we're seeing right now will hold over time. There are definitely pockets where it may work - look at Maumee and Perrysburg, for example. Get yourself a Realtor who really knows the area and the nuances of the market. I can't recommend @Stephen Brown strongly enough. Again, I'm not saying it won't work in Toledo. Just saying be conservative when you run your numbers and have an alternative exit strategy. Also, get very familiar with property taxes which are all over the map in Ohio. As a CA resident used to Prop 13, you may be shocked at how high property taxes are elsewhere - I still am!

    [email protected]
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  • Tyson Thurman
    OP
    New to Real Estate · Los Angeles County, CA · Member since 2021 · 37 posts · 10 votes
    5y

    @Bonnie Low Hi Bonnie, thank you so much for the reply. I have to agree that @Stephen Brown has been a great resource for me getting started in the Toledo market. We spoke about the difficulties of utilizing the BRRRR strategy in Toledo and as of now, I am looking to purchase my first buy & hold / cash flowing property in the next few months to get started in the market as opposed to going straight for the BRRRR. Thanks again for chiming in!

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  • Stephen Brown
    Real Estate Broker · Huntsville, AL · Member since 2019 · 1k+ posts · 872 votes
    5y

    @Bonnie Low @Tyson Thurman I appreciate the kind words. I'm always here to help. It is definitely tough to BRRRR here given our market, labor costs, lack of quality contractors, and other factors.. but it is doable given our phenomenal rent to price ratio. Out of state makes it 20x harder. I'd recommend straight rentals here bought at a discount.

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  • Melanie MurphyPro Member
    Member since 2019 · 4 posts · 1 vote
    5y

    @lara white ultimately I am looking to BRRRR. I have done single family in Memphis but not against bumping up to 4units multi

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