Out of state investing
Cody MiraclePro Member
Member since 2025 · 1 post · 16 votesOut of state investing
Most Popular Reply
Member since 2018 · 1k+ posts · 1k+ votes
1yQuote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
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As a former military man myself, and knowing the demands of investing out-of-state in general (check Bigger Pockets in general for the perils of investing non-local), I will give you some advice in military parlance so that you will absolutely understand when it comes to non-local investing:
"Not 'NO,' but "F*** NO!!!!!!'"
You will note that everyone telling you to buy out-of-state is either a real estate agent or an investor who has something to sell. That means that they get paid on commission or for a sale. They don't care if you make money. They only get paid if you buy. Once they have their paycheck, they are gone.
Where are you in your military career?
If you are less than an E-6 or O-3, you should be concentrating on learning the the ropes. If you are ready to take the plunge, buy local, house hack, and have a management company lined up for when you get transferred. Run your numbers conservatively.
38 Replies
- Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes1y
I would use your VA loan to house hack. You can do it in each area you live in. Out of state is not a terrible idea but I don't think you need to
- 1yArman AhmedPro MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 961 votes
Cody, for active-duty military or anyone who moves frequently, out-of-state investing in Midwest markets can make a lot of sense. Property prices are lower, cashflow is stronger, and you can build a rental portfolio without tying up too much capital. Even if you can’t manage it in person, working with a trusted local property manager makes it realistic to invest from afar while still growing wealth.
- 1ySamuel DioufBusiness MemberReal Estate Agent · Columbus & Cleveland, OH · Member since 2023 · 1k+ posts · 1k+ votes
Out-of-state/virtual investing could be a good option for your current situation as it sounds like if you invest locally now it could still end up having to be managed virtually.
If you decide to invest virtually... Once you get your systems down, you have a real estate business model that you can take to any market and still be successful. I personally work with plenty of out-of-state investors (A lot from California) who are seeing great success here in Ohio, so it's definitely a proven strategy.
Read this article on the "core 4". It explains the team that you should develop to have a strong foundation under you while investing remotely.
https://www.biggerpockets.com/blog/core-four-real-estate-team
-855-417-7107
Reafco - Samuel Diouf528 Reviews - Member since 2018 · 1k+ posts · 1k+ votes1y"I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not."
Quote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
--------------------------------------------------
As a former military man myself, and knowing the demands of investing out-of-state in general (check Bigger Pockets in general for the perils of investing non-local), I will give you some advice in military parlance so that you will absolutely understand when it comes to non-local investing:
"Not 'NO,' but "F*** NO!!!!!!'"
You will note that everyone telling you to buy out-of-state is either a real estate agent or an investor who has something to sell. That means that they get paid on commission or for a sale. They don't care if you make money. They only get paid if you buy. Once they have their paycheck, they are gone.
Where are you in your military career?
If you are less than an E-6 or O-3, you should be concentrating on learning the the ropes. If you are ready to take the plunge, buy local, house hack, and have a management company lined up for when you get transferred. Run your numbers conservatively. - MD/DC · Member since 2024 · 1k+ posts · 1k+ votes1y
Where is family? Do you see yourself settling back in that area eventually? That would be something I would consider but in general I'm not in favor of not being able to oversee my own farm, even when I'm using a PM.
- 1yMackaylee BeachPro MemberReal Estate Agent · Kansas City, MO · Member since 2020 · 1k+ posts · 492 votes
Have you thought about the Midwest—specifically, Kansas City?
Our city is experiencing rapid growth, presenting numerous investment opportunities. I would be thrilled to discuss potential opportunities with you and explore how we can make your investment goals a reality. Feel free to reach out if you'd like more information on what Kansas City has to offer!
- Member since 2025 · 104 posts · 37 votes1y
I'm partial to the OKC Market with my Real Estate Investing. A good Property Management Company will make your life easy when it comes to Out Of State Investing.
My belief is “passive” (meaning no value add, flip, etc - residential RE is never truely passive) real estate investing is challenging everywhere.
Historically San Diego has been an outstanding location to invest in real estate. Contrary to the Midwest people who claim they have great cash flow, it has not historically been true for long holds and I challenge any of them to find a reputable source that shows ANY large Midwest city to have better cash flow over a long hold than San Diego (there are none). Historically the best initial cash flow markets are the worst over long holds because they have good initial cash flow because their growth (appreciation and rent growth) outlooks are poor.
The VA loan is a great benefit. You should maximize this benefit as it is a benefit you have earned.
Now for San Diego
- if you purchase a move-in ready, high LTV residential property via a va loan, mls (retail) properties will be very cash flow negative in the initial years. The higher the number of units, the less negative it will be, but it will be cash negative when properly allocating for expenses. Furthermore it will be cash negative for a while. In addition, the cash flow will stay Negative for quite a while. This is not unique to San Diego but virtually all markets.
- you need to be able to handle the negative cash flow that likely will be challenging at times. When a tenant leaves a unit in not the best shape and you are cash flow negative, you may question the why.
- the why is because if you have a fixed rate loan, the largest expense is fixed. In California the property tax is near fixed price. Rents historically have appreciated near top of nation and the appreciation this century is near top of nation. This means the cash flow will improve with time and historically the return is from the appreciation.
- How good has the appreciation been? My worse appreciating property has appreciated $2700/month over its long hold. I have 3 properties that have appreciated over $10k/month. I believe virtually all residential long holds in San Diego will be between those two numbers (excluding cheaper condos).
So my suggestion is you analyze whether the long term upside is worth the short-term price. If it is not, the RE investment market will not always be as challenging as it is at this moment. There is nothing wrong with waiting to use your VA loan benefit. When the time is right for you, use the benefit. It does not have to be San Diego.
Good luck
I hear you, Cody! those are the same questions I wrestled with early on. House hacking can be a great way to lower your living costs while learning the ropes, especially if you’ll be there for a couple years. On the flip side, if you want stability while you’re moving around, buying in a more affordable market with a good property manager can give you passive income without being tied down. Both paths have pros and cons and it really comes down to whether you want to focus on reducing your own housing expenses now or building long-distance systems from the start.
Have you thought about which would be more valuable for you in the short term? saving on rent or learning how to manage a property remotely? Happy to keep the conversation going!
- 1yBradley BuxtonBusiness MemberReal Estate Agent · NV · Member since 2023 · 1k+ posts · 720 votes
Use your VA loan to get a duplex in your local area. This way you can help offset the mortgage, you're not sharing rooms and if and when you move you'll have 2 sources of income from the property. In the future, ideally, you can refund out and get your VA eligibility back to use on your next purchase.
- Specialist · Member since 2025 · 483 posts · 270 votes1y
If cash flow's your top priority, I'd look out-of-state. If lifestyle and using your VA loan are more important, San Diego could work. For cash flow, I'd suggest picking 1–2 landlord-friendly markets, building your "core four" (agent, PM, lender, GC), and sticking to a tight buy box. Want me to help you pick a market or set that buy box?
- 1yJimmy LieuBusiness MemberReal Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
Quote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
Hey Cody, welcome to BP and thanks for sharing your situation! Being active duty definitely adds an extra layer since you’re moving every few years, and that makes long-distance investing a very realistic option. House hacking in San Diego could work if you want to offset your living expenses while you’re stationed there, but because prices are so high it might be tough to hit strong cash flow numbers. That’s where out-of-state investing comes in—it allows you to buy in more affordable markets where properties can still meet the 1% rule and cash flow right away. A lot of military investors go this route since they’re already used to moving and managing things remotely. Columbus, Ohio is one market I’d suggest looking at because the fundamentals are really strong—population growth, job growth, and major companies like Intel, Amazon, Google, Facebook, Microsoft, Honda, LG, and more moving in or expanding here. You can still find solid deals in the $120K–180K range that rent well and provide both cash flow and appreciation potential. The landlord laws in Ohio are also investor-friendly, which makes it easier when you’re managing from a distance. Long-distance investing is absolutely doable as long as you build a good local team (agent, property manager, contractor) so you’re not trying to handle everything yourself from afar. Happy to connect and answer any questions you have!
Jimmy Lieu, Red 1 Realty4.9121 Reviews - 1yBernice RetzloffPro MemberMemphis, TN · Member since 2024 · 234 posts · 100 votes
Hey @Cody Miracle, welcome to the world of real estate investing and thank you for your service!
That’s a great question! And honestly one a lot of people wrestle with, especially in higher-cost markets like San Diego. A couple of thoughts:
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House hacking can be an amazing way to start if the numbers make sense. It lets you live for cheaper, build equity, and get that first taste of managing tenants. Since you’ll be moving in a few years, you’d just want to make sure the property would still work as a rental once you move out.
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Out-of-state investing might be a better play if your goal is stronger cash flow right away. The key here is building the right team! An investor-friendly agent, property manager, and lender so you don’t feel the distance.
A lot of military folks go this route because moving around makes it harder to self-manage. For example, here in Memphis, TN, homes are much more affordable compared to San Diego, and the rental demand is strong. I’m a real estate agent based in Memphis and work with out-of-state investors all the time to help them grow their rental portfolios, so if you ever want to explore this market, I’d be happy to answer questions or point you in the right direction.
Either way, you're in a great spot! Steady income, VA loan benefits, and time on your side. The most important step is just getting that first property under your belt.
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- 1yBernice RetzloffPro MemberMemphis, TN · Member since 2024 · 234 posts · 100 votes
Hey @Cody Miracle, welcome to the world of real estate investing and thank you for your service!
That’s a great question! And honestly one a lot of people wrestle with, especially in higher-cost markets like San Diego. A couple of thoughts:
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House hacking can be an amazing way to start if the numbers make sense. It lets you live for cheaper, build equity, and get that first taste of managing tenants. Since you’ll be moving in a few years, you’d just want to make sure the property would still work as a rental once you move out.
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Out-of-state investing might be a better play if your goal is stronger cash flow right away. The key here is building the right team. An investor-friendly agent, property manager, and lender so you don’t feel the distance.
A lot of military folks go this route because moving around makes it harder to self-manage. For example, here in Memphis, TN, homes are much more affordable compared to San Diego, and the rental demand is strong. I’m a real estate agent based in Memphis and work with out-of-state investors all the time to help them grow their rental portfolios, so if you ever want to explore this market, I’d be happy to answer questions or point you in the right direction.
Either way, you're in a great spot! Steady income, VA loan benefits, and time on your side. The most important step is just getting that first property under your belt.
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- 1yMelissa JusticeBusiness MemberRental Property Investor · Phoenix, AZ · Member since 2024 · 518 posts · 1k+ votes
Hey! welcome to the community! Given your situation - active duty military, moving every few years, and high local home prices - an out-of-state investment could make a lot of sense. There are markets in the Midwest and Southeast where your dollar goes much further, and you can find turnkey rentals that are tenant ready with property management companies in place. That way, you don’t have to manage major rehabs or local tenant issues yourself.
House hacking locally could work too, especially if you want to build equity while you're stationed in San Diego. But keep in mind the costs are high and cash flow may be tight, so your returns might be smaller unless you're doing some creative financing or leveraging VA loan benefits.
A common approach for someone like you:
Use a local property for house hacking if you can get good value and it fits your timeline.
Simultaneously explore turnkey out-of-state rentals in cash-flow-friendly markets for long-term hold.
Build a network of trusted property managers, property source providers, and contractors before you move - this is key for out-of-state success.
It really comes down to whether your priority is convenience and simplicity now (house hack locally) or building long-term, higher cash-flow assets (turnkey rentals out of state).Always happy to chat more about what's worked for other investors in similar situations. Best of luck!
- 1yJordan RayBusiness MemberReal Estate Agent · Memphis, TN · Member since 2023 · 642 posts · 336 votes
Quote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
Welcome to BiggerPockets, and thank you for your service! A lot of military buyers face the same question — buy where you’re stationed now or start building a portfolio in a more affordable, landlord-friendly market. San Diego is a tough place to hit positive cash flow, so you’re right to weigh your options carefully.
One reason so many active duty and PCS’ing service members invest in Memphis is the affordability and strong rent-to-price ratios. You can still find properties that meet the 1% rule, which is nearly impossible in markets like San Diego. On top of that, BRRRR is very doable here — with hard money lenders funding 100% of the purchase and 100% of the rehab, investors are usually only in for about $10K out of pocket per deal. That makes scaling while moving every few years much more realistic.
The key, especially for out-of-state military investors, is having local expertise you can trust: an investor-friendly agent who also owns rentals, partnered with a strong property management and contractor team. That gives you the eyes on the ground you need so you don’t feel like you’re gambling while away on orders.
If you'd like, I can share how other active duty investors are structuring their first Memphis deals and setting themselves up to scale while still serving? I also am a Veteran and got started by leveraging my VA loan so I am happy to elaborate on all possibilities! Reach out if you have any interest in Memphis! Talk soon!
Jordan Ray - eXp Realty5112 Reviews - 1yPatrick DruryBusiness MemberReal Estate Agent · Columbus, OH & Cleveland OH · Member since 2021 · 1k+ posts · 2k+ votes
@Cody Miracle
If you are in the military, I would try to use your VA loan to buy something local - Iowa & Colorado · Member since 2025 · 15 posts · 8 votes1y
I am investing out of my home state for a couple of reasons,
1) I have family in the area that can assist if need be
2) Land is much more affordable
3) I will be moving there within the next 5 years - once I have my first units built to where building the next 8-plex will be my full time job.
Sure, I won't get near the rents as I would in Colorado, but I also won't have near the expenses. At this stage in my investments, I wouldn't invest out of state without family/friends that can help support. But once I have my land developed, this becomes a little different as there will be 100+ doors that will help pave the way for the next development.
- Iowa & Colorado · Member since 2025 · 15 posts · 8 votes1y
I am investing out of my home state for a couple of reasons,
1) I have family in the area that can assist if need be
2) Land is much more affordable
3) I will be moving there within the next 5 years - once I have my first units built to where building the next 8-plex will be my full time job.
Sure, I won't get near the rents as I would in Colorado, but I also won't have near the expenses. At this stage in my investments, I wouldn't invest out of state without family/friends that can help support. But once I have my land developed, this becomes a little different as there will be 100+ doors that will help pave the way for the next development.
- 1ySam McCormackBusiness MemberReal Estate Agent · Cincinnati, OH/NKY · Member since 2021 · 1k+ posts · 834 votes
Quote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
Houseacking is the way to go in my opinion. And once you move out, you can fully rent it and do it somewhere else. OOS investing in still possible but I would recommend househacking. If you do deicide to go OOS in a cheaper market, Cincinnati is pretty good. Let me know if you have questions!
Sam McCormack Realtor - 1yRemington LymanBusiness MemberReal Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
Quote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
I would try to house hack if you can get approved to purchase a property for the price you want
- Real Estate Broker · Chicago, IL · Member since 2014 · 2k+ posts · 1k+ votes1y
Quote from @Cody Miracle:
I have just recently discovered the possibility of real estate investing and I'm concerned whether I should invest out of state or not. I currently live in San Diego but seem to find the area too expensive for my liking. I am active duty military so I move around every few years for work, so I'm trying to decide if buying a property here and house hacking for the next couple of years until I move or making my first investment in a cheaper area is the better option.
So this is not my story but my business partner. He worked for a Defense Contractor for many years and many of his superiors were retired Military. He once told me a story of one of his bosses that that moved about 20 times during his career and purchased a property everywhere he moved. He never sold any of his properties, just rented them out & had a nice cashflowing portfolio when he retired. Since the homes he purchased were near military bases he never had any problems renting them out. So I say following that model.
- 1yKerlous TadresBusiness MemberRealtor · Columbus, OH · Member since 2023 · 1k+ posts · 1k+ votes
Hey @Cody Miracle! From my experience, it comes down to numbers and flexibility. If a property where you’re stationed can at least break even once you move, house hacking can be a great start. If it won’t, focus on finding a deal that cash flows and build a solid local team so you’re not tied to one place. Run the math both ways and pick the option that fits your long-term plan, not just where you live today.
Kerlous Tadres | Reafco Real Estate541 Reviews - Real Estate Agent · San Diego, CA · Member since 2017 · 20 posts · 6 votes1y
If its your first home purchase, I would start with where you live. House hacking is a great idea to help off-set your mortgage. Once you understand how the buying process works, have experience with maintaining a home and dealing with tenants, you'll be able to make a more informed decision for the next time around.
The VA loan is a great opportunity to buy real estate without having to put any money down that civilians don't have access to. If you do have cash to put down, there are currently tons of homes for sale right now that are advertising a VA loan assumption, meaning you can take over the seller's 2.75% (or whatever low interest rate they have!) and their low monthly payments if you have cash for the equity. I'm happy to send you some of these if of interest - just shoot me a message.
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