Investor · Cincinnati, OH · Member since 2022 · 47 posts · 22 votes
Looking to invest out of state and wondering what processes others who have done this went through - what went well and what obstacles you faced. Also how does the market you chose perform compared to what you expected and would you do anything different regarding your market/strategy choice?
Real Estate Agent · Miramar Beach, FL · Member since 2016 · 285 posts · 245 votes
3y
@Bret Halsey Picking the market is the most important thing. In my experience, purchasing in an area that you have some type of connection to (family, friends, etc.) can be a huge advantage. Although it isn't absolutely necessary, having someone who has local knowledge and who could drive by your property occasionally that you can trust is crucial. When I was in CA full-time, it was great having people down in FL who could check out my properties on occasion, grab the mail if it was getting too full, pick up trash/debris in the yard, etc. You can always hire people to do these things, but it's not always the same as people who care about you and who you can trust.
Next, you really want to find an area with a strong and steady economy, local attractions, and quality amenities. If you're looking at an STR strategy, consider areas in beach towns, near large universities, near several corporate headquarters, or in an area with multiple professional sports teams. Areas like these are constantly bringing new or recurring visitors into town.
Lastly, I would look in areas that generally have favorable policies and regulations around rental property. Some quick research can tell you which states lean in favor of landlords and which are more pro-tenant, but the last thing you want is to have issues with a tenant refusing to leave while you're 1,000 miles away.
I own in CA and FL but I employ different strategies in each market. In CA, I own exclusively LTRs in quality neighborhoods and in FL, I own exclusively STRs in a highly-popular beach destination. If I were to flip my strategies between states, neither would work great.
With that said, I would recommend that you
1) Pick 3-5 Markets
2) Research Industries, Regulations, Growth Rates to Refine Markets Down to 1-2
3) Determine Your Strategies in Those 1-2 Markets
4) Figure Out Which Strategy Works Best in Which Market for Your Goals
3) Start Getting Serious Building a Team & Making Offers in Selected Market