Brand New to Out of State Investing -with Tristate or Northeast Region

[Barbara Peluso]

I am considering an out-of-state multi-family home for cash flow purposes.  I am new to BP, and would love to tap into your experience and any tips.  I would prefer a home with minimal work needed in a solid market.  Based on some of the readings thus far, it seems that many folks are suggesting staying close to home.  I would prefer a landlord friendly state. Thanks in advance for your insight. 

Best regards,

Barbara Peluso

Based out of NY

[Nicholas L.]

@Barbara Peluso

hello and welcome!  i am happy to try to help.  

first, i am just going to be very direct on your expectations - because i always get nervous when new investors want "cash flow."  here's why: there really is not cash flow right now in the first few years (or sometimes longer) on long term rentals, anywhere.  zero, nada, none.  not in landlord friendly states, not in anti-landlord states.  not anywhere.

it costs money to transact, it costs money to get rent ready, it costs money to lease out, it costs money to stabilize.  so in a sense, there is cash flow in the first few years - it's your cash flowing into the property.  you may know all this already but we see so many forum posts from new investors who hit one speedbump - high closing costs, a big repair, a rough tenant turn - and it ruins everything for them.

OK, that's out of the way.  i'm in the stay closer to home camp.  if another state is a couple hours from you, that's fine.  but it just does not make sense to buy thousands of miles away in a market you don't know and have never been to.  being hands-on can be important when you're getting started.