I am in a bad market looking to make my first investment. Where should I invest?
Salt Lake City Utah · Member since 2026 · 2 posts · 8 votes
I am in a bad market looking to make my first investment. Where should I invest?
Most Popular Reply
Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votesA common issue, so Copy & Paste info below:
You’re ALWAYS better off investing locally, where it’s easier to:
· Learn the market
· Network to find deals
· Network to find contractors
· Be more hands-on
· Driveby property to keep tabs on it
· Network to find a decent Property Management Company (PMC)
Next best location is somewhere else you lived, where you have an existing network of family & friends to help you as accomplish the above list as needed.
If you invest OOS, your biggest challenge won't be finding properties to meet your goals on paper, it’ll be successfully building a knowledgeable & trustworthy local team.
The biggest mistake we see OOS investors making in our market, over and over again, is not fully understanding Neighborhood/Property/Tenant Classes and how they impact your probability of success!
They all run their ROI numbers assuming Class A results – when buying Class B, C & even D rentals.
Then they’re shocked when their performance expectations aren't met😞
If you choose to invest OOS, and have little to no landlord experience, we highly recommend targeting Class B Neighborhoods/Properties/Tenants. If you target Class C, you better be prepared emotionally & financially for plenty of challenges.
You can find Class B properties in the Midwest to BRRRR, but it will take more digging and YOU will need to understand how to analyze & identify them - because a lot of agents, wholesalers, PMCs, etc. will try to sell you Class C or D misrepresented as Class B:
· Many of them don't know/care what Class the properties are, so they're incompetent.
· Others know exactly what they are doing, so should be labeled as crooks!
EITHER WAY YOU LOSE!
Why is Property Class so important for investors to understand and apply in their investing strategies?
Because the Property Class dictates the Class of the tenant pool that the property will attract.
The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.
Both Property Class and Tenant Class will affect what type of contractors, handymen and property management companies you should target and be willing to deal with a property.
The Property Class will also impact the maintenance & renovations you do to, “Maintain to the Neighborhood/Market”.
Why is that important?
Well, if you buy & renovate a property in Class D area to Class A standards, what Tenant Class will actually rent it?
Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?
What do you think will happen if you rehab a Class D rental to Class A standards?
So, if you fail to apply the correct assumptions to a property, your expectations won’t be met, and it may even be a financial disaster.
We use the following to rank Property Classes, in order of importance:
Property Tenant Pool: closely linked to location, but not always.
Property Location: closely linked to tenant pool, but not always.
Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood/Market.”
Key metrics for each Property Class:
Class A Properties:
Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
Tenant Default: 0-5% probability of eviction or early lease termination.
Section 8: Class A rents are too high and won’t be approved.
Vacancies: 5-10%, depending on market conditions.
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.
Class B Properties:
Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
Tenant Default: 5-10% probability of eviction or early lease termination.
Vacancies: 10-15%, depending on market conditions.
Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
Section 8: Class B rents are usually too high for the Section 8 program.
Class C Properties:
Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
Tenant Default: 10-20% probability of eviction or early lease termination.
Section 8: Class C rents usually meet program requirements, proper screening still recommended.
Vacancies: 10-20%, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.
Class D Properties:
Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
Tenant Default: 20-30% probability of eviction or early lease termination.
Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
Vacancies: 20%+, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.
Where did we get our FICO credit score information from?
Check out this chart:
FICO Score | Pct of Population | Default Probability |
800 or more | 13.00% | 1.00% |
750-799 | 27.00% | 1.00% |
700-749 | 18.00% | 4.40% |
650-699 | 15.00% | 8.90% |
600-649 | 12.00% | 15.80% |
550-599 | 8.00% | 22.50% |
500-549 | 5.00% | 28.40% |
Less than 499 | 2.00% | 41.00% |
Make sure you understand the Class of properties you are looking at and the corresponding results to expect.
For example, Metro Detroit has 132 cities and the City of Detroit 183 Neighborhoods, which we’re analyzing and classifying to make better investing decisions.
Logical Property Management4.9465 Reviews
31 Replies
- 2wNicholas L.Pro MemberFlipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
Do you have family or a network in Indiana? I strongly recommend against picking a market based solely on price point, if that's what you're doing here. Purchasing a rental and putting it into service anywhere is expensive, as you'll have thousands and thousands of dollars in costs and expenses - closing costs on the purchase, rent-ready costs, lease-up costs to get rented out, repairs, turnover, etc.
Unfortunately, returns on non value add LTRs are very, very low right now (again, everywhere). I know this is a real estate forum (and I am still buying), but I am encouraging new investors to think very carefully about where to allocate their cash (and you need cash). It's not obvious to me that a random LTR in a place you've never been to is going to do anything for you. If your immediate area is too expensive, can you go out an hour, or two? There's just no substitute for being hands on.
Hope this helps - happy to dialogue further. And here's some light reading about OOS.
Turnkey Nightmare: Property Manager Ignored My Warning About a Missing A/C…
Nightmare with my property manager - advice needed!
Feedback Needed: $8.8k Turnover Quote for 2BR Duplex (Half)
Out-of-State Landlord Nightmare: 4 Months No Rent, Cleveland Escrow Battle
Failed BRR in Memphis TN - Salt Lake City Utah · Member since 2026 · 2 posts · 8 votes2w
Thank you for replying. I am going to ponder a few things you said here before replying further.
This is already more helpful than you know
- 2wAustin GoetzBusiness MemberLender · Minneapolis, MN · Member since 2026 · 33 posts · 10 votes
I'd be happy to help with the lending side. I work with investors purchasing out of state, across all states, and can walk you through the loan process, down payment/reserve requirements and answer any other questions you have.
There are definitely some important things to consider with long-distance investing beyond just finding a good looking market. Feel free to message me and I’d be happy to help you get started.
- 2wJames JonesPro MemberInvestor · Collierville, TN 38017 · Member since 2017 · 830 posts · 602 votes
Salt Lake to Memphis is exactly the jump I see work - and fail. Here's the difference.
Pick the market by the numbers, not the hype. I buy 3BR+ single-family in Memphis ZIPs like 38109, 38111, 38114, and 38118 - all-in under $100K, Section 8 rents $1,395-$1,950, clears the 1% rule. If the math doesn't work on paper, it won't work from 1,500 miles away either.
Key things for long-distance: (1) a buy box so tight your team can underwrite without you; (2) a contractor who walks properties and gives rehab numbers in 24 hours; (3) a property manager lined up before you close, not after.
On loans: DSCR loans at 70-80% LTV are built for out-of-state investors - no personal income verification, the property qualifies itself. Have the lender picked before you make offers.
236 properties, all bought from one market I know cold. Depth beats breadth.
- 2wDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
A common issue, so Copy & Paste info below:
You’re ALWAYS better off investing locally, where it’s easier to:
· Learn the market
· Network to find deals
· Network to find contractors
· Be more hands-on
· Driveby property to keep tabs on it
· Network to find a decent Property Management Company (PMC)
Next best location is somewhere else you lived, where you have an existing network of family & friends to help you as accomplish the above list as needed.
If you invest OOS, your biggest challenge won't be finding properties to meet your goals on paper, it’ll be successfully building a knowledgeable & trustworthy local team.
The biggest mistake we see OOS investors making in our market, over and over again, is not fully understanding Neighborhood/Property/Tenant Classes and how they impact your probability of success!
They all run their ROI numbers assuming Class A results – when buying Class B, C & even D rentals.
Then they’re shocked when their performance expectations aren't met😞
If you choose to invest OOS, and have little to no landlord experience, we highly recommend targeting Class B Neighborhoods/Properties/Tenants. If you target Class C, you better be prepared emotionally & financially for plenty of challenges.
You can find Class B properties in the Midwest to BRRRR, but it will take more digging and YOU will need to understand how to analyze & identify them - because a lot of agents, wholesalers, PMCs, etc. will try to sell you Class C or D misrepresented as Class B:
· Many of them don't know/care what Class the properties are, so they're incompetent.
· Others know exactly what they are doing, so should be labeled as crooks!
EITHER WAY YOU LOSE!Why is Property Class so important for investors to understand and apply in their investing strategies?
Because the Property Class dictates the Class of the tenant pool that the property will attract.
The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.
Both Property Class and Tenant Class will affect what type of contractors, handymen and property management companies you should target and be willing to deal with a property.
The Property Class will also impact the maintenance & renovations you do to, “Maintain to the Neighborhood/Market”.
Why is that important?
Well, if you buy & renovate a property in Class D area to Class A standards, what Tenant Class will actually rent it?
Or, if you put several Class D tenants in a Class A four-plex, what do you think will happen to the property?
What do you think will happen if you rehab a Class D rental to Class A standards?
So, if you fail to apply the correct assumptions to a property, your expectations won’t be met, and it may even be a financial disaster.
We use the following to rank Property Classes, in order of importance:
Property Tenant Pool: closely linked to location, but not always.
Property Location: closely linked to tenant pool, but not always.
Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood/Market.”
Key metrics for each Property Class:
Class A Properties:
Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.
Tenant Default: 0-5% probability of eviction or early lease termination.
Section 8: Class A rents are too high and won’t be approved.
Vacancies: 5-10%, depending on market conditions.
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Class B Properties:
Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.
Tenant Default: 5-10% probability of eviction or early lease termination.
Vacancies: 10-15%, depending on market conditions.
Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.
Section 8: Class B rents are usually too high for the Section 8 program.Class C Properties:
Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years. Verifying recent 2-years of rental history very important! Same for 2-years of job/income stability.
Tenant Default: 10-20% probability of eviction or early lease termination.
Section 8: Class C rents usually meet program requirements, proper screening still recommended.
Vacancies: 10-20%, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Should cashflow immediately, at the lower end of relative rent & value appreciation.
Class D Properties:
Tenant Pool: Majority of FICO scores under 560, little to no good tradelines, lots of collections & chargeoffs, but should have no convictions/evictions in last 12 months. Verifying last 2-years of rental history and income/employment extremely important to find the “best of the worst”.
Tenant Default: 20-30% probability of eviction or early lease termination.
Section 8: Class D rents meet program requirements, often challenges to pass Section 8 inspection.
Vacancies: 20%+, depending on market conditions and tenant screening.
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation.Where did we get our FICO credit score information from?
Check out this chart:
FICO Score
Pct of Population
Default Probability
800 or more
13.00%
1.00%
750-799
27.00%
1.00%
700-749
18.00%
4.40%
650-699
15.00%
8.90%
600-649
12.00%
15.80%
550-599
8.00%
22.50%
500-549
5.00%
28.40%
Less than 499
2.00%
41.00%
Make sure you understand the Class of properties you are looking at and the corresponding results to expect.
For example, Metro Detroit has 132 cities and the City of Detroit 183 Neighborhoods, which we’re analyzing and classifying to make better investing decisions.
Logical Property Management4.9465 Reviews - 2wArman AhmedPro MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 961 votes
If your local market is tough, I’d definitely compare a few Midwest markets before making a decision. Indiana can be worth a look, but I’d also look at neighboring markets where you may find lower entry prices and deals that actually cash flow. For out-of-state investing, the biggest thing is having a solid local team, especially a lender, PM, contractor, and inspector you can trust.
- Real Estate Agent · TN · Member since 2022 · 6 posts · 5 votes2w
Hi! I moved to Tennessee from the Chicago area, so I know what it's like to buy in a place you can't easily drive by on a weekend.
One question first, because it changes most of the answer: are you planning to keep the property as a rental, or fix it up and resell it?
If you're keeping it as a rental, decide what you want it to do. Many people look at Indiana because rents there can cover the mortgage and still leave money each month. Here in Middle Tennessee, the monthly profit is usually slimmer, but home values have grown steadily. Before you buy, ask a local property manager or Realtor what it would really rent for, and get an insurance quote before you make an offer. For financing, a traditional investment loan usually needs 20–25% down and is based on your income. A DSCR loan is approved based on the property's rent instead of your paycheck.
If you're fixing and reselling, I'd be honest with yourself about doing your first one from a distance. The hardest part of a flip is keeping the renovation on budget and on schedule, and that's tough to manage from another state. If you go that route, have a contractor you trust, a local agent who can check in on the work, and extra money set aside for surprises. These are usually financed with short-term renovation loans that cover the purchase and repairs, and they cost more than a regular mortgage.
Either way, like Arman said find your people before you find a property: an agent who works with investors, a lender who can lend in the state where you're buying, and a good inspector. Visit at least once if you can. Two homes a few streets apart can be very different investments.
I've been helping investors evaluate deals for almost 10 years. If you'd like a second opinion on a property, or want to compare an Indiana deal against one here in Middle Tennessee, I'm happy to help. Wishing you the best as you get started!
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2w
What do you consider a bad market and why is it bad / why do you think it’s bad ?
7e investments53 Reviews- 2wAaron ZimmermanBusiness MemberAccountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
@Chris Seveney was going to ask the same thing!
Brick House CPAs53 Reviews
- 2wRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
Indianapolis seems to be a pretty solid market by all accounts, is that far from where you are located?
Harpoon Capital514 Reviews Hi Carson from Salt Lake City, Utah-
Congratulations! You are new to real estate investing and are looking to invest out-of-state and wonder which markets you should be considering.
There are several markets in Michigan that are attractive like Lansing, Kalamazoo, and the Bay City/Saginaw/Midland areas.
Make sure you have an experienced investor friendly Realtor, property manager, and property inspector at a minimum when investing out-of-state.
There are some loans you can get out-of-state like a DSCR loan or Debt Service Coverage Ratio loan that is based on the income of the property but it is also good to have a relationship with a good local lender that your local team can introduce you to.
Think about investing with duplexes as you should always have a rent check coming in and two bedroom units should be a minimum with storage like a basement or garage to reduce turnover.
To Your Success!
- 2wJames WachobBusiness MemberReal Estate Broker · Memphis, TN · Member since 2015 · 1k+ posts · 891 votes
Hey @Carson Tuttle!
Investing out of state can definitely work, but I’d start by choosing the market first and then building the team around it. Indiana could be worth looking into, but I wouldn’t choose a market based only on purchase prices. Look at rents, taxes, insurance, employment, tenant demand, property condition, and what the numbers look like after all expenses.
For long-distance investing, having reliable people on the ground is probably the biggest piece. A good local agent, property manager, lender, and contractor can make the process a lot easier. For financing, I’d talk with a few lenders who regularly work with out-of-state investors and get pre-approved before seriously shopping. They can walk you through the loan requirements, down payment, reserves, and what changes based on the property and your situation.
I’m a real estate agent based in Memphis, TN, and I work with out-of-state investors building rental portfolios. Memphis is another market I’d encourage you to research if you’re looking for a lower entry point and rental cash flow. If you ever want to compare Memphis with Indiana or other markets you’re considering, I’d be happy to connect and help.
- 2wMike PaolucciBusiness MemberRealtor · Columbus Cleveland Dayton, OH · Member since 2022 · 501 posts · 553 votes
Quote from @Carson Tuttle:
As the Title says, I am in a bad market, and a soon to be investor.
Where are the best cities/states to invest. I have been looking at potentially Indiana.
What are some of the key things to know when it comes to long distance investing?
What are the steps to getting a loan out of state?
If anyone can help me answer these questions, or at least give me some guidance that would be great and much appreciated!
Thank you!
I can't speak on if Inidiana is the best city/state to invest in but I can speak on Ohio.
Ohio has been pretty good to me for the most part. Some bumps along the way, but that's REI in general. I'm a big fan of Columbus & Dayton personally. Can still find properties that give you decent cashflow, given the current state of the market and rates.
Key things to know is knowing the market that you choose to invest in. Know and understand what works / what doesn't work in the market and how to succeed. Build the right teams and foster the local relationships and you'll do fine.
Getting an OOS loan is the same as a local loan. You'll still need to get a pre-approval and go through the normal process. The advantage you'll have is that as an investor, you have access to both the traditional laons as well as investor loans like DSCR products and few others. Just need to get connected with the right lenders.
Happy to answer additional questions.
Reafco - Mike Paolucci 512 Reviews - Real Estate Broker · Member since 2024 · 134 posts · 62 votes2w
Getting priced out of SLC is common, so looking at Indiana makes sense. Pick the market on rent-to-price, landlord laws, and whether you can find a PM you trust, in that order. The cheapest market is rarely the best one.
From a distance your team is the business: a lender, an agent who actually owns rentals, a PM, and a contractor you've seen work. Get the PM's read on rents before you go under contract, not after.
On loans, conventional works fine out of state if you're buying in your own name. DSCR is an option if your income doesn't support it, just expect a higher rate and 20-25% down. What's your budget per door?
Quote from @Carson Tuttle:
As the Title says, I am in a bad market, and a soon to be investor.
Where are the best cities/states to invest. I have been looking at potentially Indiana.
What are some of the key things to know when it comes to long distance investing?
What are the steps to getting a loan out of state?
If anyone can help me answer these questions, or at least give me some guidance that would be great and much appreciated!
Thank you!
Great question, @Carson Tuttle. There’s a lot of good advice in the responses above, and I would agree with the general theme: don’t choose a market based solely on low purchase prices or a spreadsheet that looks good from 1,000 miles away.
From the lending side, I would add a few things.
1. Start with the investment strategy, not the state.
Before deciding on Indiana, Tennessee, Ohio, etc., determine what you're trying to accomplish:
Buy & hold?
DSCR rental?
BRRRR?
Fix & flip?
New construction?
Multifamily?
The best market for a cash-flow-focused investor may be very different from the best market for someone primarily pursuing appreciation or value-add opportunities.
2. Your local team is everything with out-of-state investing.
If you're going to invest remotely, I'd want the following before closing on the first property:
A good investor-friendly real estate agent
Property manager
Contractor/GC
Inspector
Insurance agent
Title/closing company
Someone you trust who can physically inspect the property when necessary
You don't necessarily need to know everything about the market yourself, but you need people on the ground who do.
3. Understand the numbers beyond the purchase price.
Don't just look at purchase price vs. rent.
Underwrite all-in costs, including:
Purchase + closing costs + rehab/turnover + financing costs + taxes + insurance + management + maintenance + vacancy + reserves.
Then stress-test the deal.
If the deal only works when everything goes perfectly, it's probably not a great deal.
4. Financing an out-of-state property
This is actually one of the easier pieces once you have the right lender.
For many investor properties, DSCR financing can be a good option because qualification can be based primarily on the property's rental income/cash flow rather than traditional personal-income underwriting.
The process generally looks something like:
Find the property → Analyze the deal → Get pre-qualified → Submit the property → Appraisal/valuation → Title & insurance → Underwriting → Closing.
The exact down payment, reserves, leverage, rates and documentation will depend on the property, borrower, market and loan program.
One piece of advice I'd emphasize
Don't feel like you need to buy your first property immediately just because you found a market where the numbers appear attractive.
Spend some time learning the neighborhoods, talking to investors who actually own there, speaking with property managers and analyzing 20–30 deals before you buy one.
You'll learn more from underwriting 30 deals than you will from looking at 300 listings.
And if you're looking specifically at Indiana, I'd be happy to help with the financing side and walk you through what an out-of-state investor loan would look like, including leverage, reserves, documentation and the overall process.
The market selection is ultimately your investment decision; my job as a lender is to help you understand what financing options are available once you find a deal that makes sense.
Good luck with the first one—getting the first deal right is much more important than getting it done quickly.
- 2wAshish AcharyaBusiness MemberCPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
Carson, if your local market does not produce numbers that work, investing out of state can absolutely be worth considering. I would just avoid choosing a state first and then trying to find a deal that works there. I'd start with the property economics. Look at realistic rent, property taxes, insurance, vacancy, maintenance, CapEx, property management, financing, and what the property is actually likely to produce after all of those costs.
For out of state investing, I'd also put a lot of emphasis on the local team. A good property manager, lender, contractor, and someone who can physically inspect the property can make a huge difference. For financing, talk to lenders that regularly finance investment properties for out of state borrowers. DSCR lenders, portfolio lenders, local banks, and credit unions can all have different requirements.
There is also a tax consideration that is easy to overlook. Owning a rental outside your home state can create additional state filing and tax considerations, so I’d factor that into the return rather than looking only at the property level cash flow.
I’d compare the after-tax return, not just the advertised cash flow. Feel free to DM me, I’d be happy to send over our Turn Key Rental Analyzer and a few resources that may help as you compare markets.
INVESTOR FRIENDLY CPA®4.9242 Reviews - Member since 2026 · 30 posts · 15 votes2w
One way to compare markets beyond the usual rent-to-price lists is to look at city and county records. Permit volume shows where owners and builders are putting money, and code violation and vacant property cases show how much distressed inventory is around. Since you're looking at Indiana, Chicago is right next door and worth a look too. I research Chicago's permit and building violation filings daily, and they give a more detailed picture than the headlines. Which Indiana cities are you considering?
- 2wRemington LymanBusiness MemberReal Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
Quote from @Carson Tuttle:
As the Title says, I am in a bad market, and a soon to be investor.
Where are the best cities/states to invest. I have been looking at potentially Indiana.
What are some of the key things to know when it comes to long distance investing?
What are the steps to getting a loan out of state?
If anyone can help me answer these questions, or at least give me some guidance that would be great and much appreciated!
Thank you!
I am from Connecticut. I moved to Ohio in 2012 and have been living here.
First step would be to find a solid team to help you get started. A Realtor, Lender, Property Manager, and General Contractor.
- Specialist · I give advice - [email protected] - I focus on states where investing is profitable, reasonably safe & secure · Member since 2026 · 148 posts · 48 votes2w
Quote from @Carson Tuttle:
As the Title says, I am in a bad market, and a soon to be investor.
Where are the best cities/states to invest. I have been looking at potentially Indiana.
What are some of the key things to know when it comes to long distance investing?
What are the steps to getting a loan out of state?
If anyone can help me answer these questions, or at least give me some guidance that would be great and much appreciated!
Thank you!
When we are determining markets for investors we look at the "offsets"
With distance comes decisions:
Do you know the area
How much of our "hard fought for" profit are we willing to give up to management fees
Every property requires occasional visits and sometimes that arrives at inconvenient moments,
Are the ones who are going to inherit the situation willing to deal with the area
Is there a way to get the same results where we live (by taking a different approach to financing)
Various other long term considerations.
We want people to invest for the long term and not find out they made a serious mistake and get discouraged (read some of the other Bigger Pockets Posts on mistakes people have made investing out of state)
We encourage people to invest where they live and they are plenty of ways to make that happen.
- Member since 2026 · 1 post · 0 votes2w
What's your goal on the first deal?
How much do you have to invest into it?Are you buying something turn key? (ready to rent right away) Buying something with a tenant already in? Or buying something that needs renovation?
This all gives us an idea of what kinds of deals you are looking for. And it let's us know if investing out of state is a preference, or a requirement due to prices.
Is it:
Option A- that you can afford to invest in Salt Lake, but are trying to maximize returns by picking the perfect market?
Option B- invest somewhere now where you can afford it because you only have $30,000 to put into the deal and that doesn't work in Utah.
Weird question but, how comfortable are you with the potential that you might not get an excellent return on your first deal?
If you lose some or all of the money, how devastating is that?
Investing out of state is risky. Investing an uncomfortable amount of money in your market is risky. But the risks are different.
A cheap, turnkey, cash flowing rental, in a market where your best friend lives around the corner and will gladly check on it for you? Probably not too bad.
Buying a complete gut job renovation deal, where you don't have any connections, and trying to make life changing money on the first deal? Probably not great. - Lender · Boynton Beach, FL · Member since 2026 · 52 posts · 30 votes2w
Hey Carson - Great question, I was in same spot looking out-of-state from my market.
I focus on Delray Beach FL 33445 (Bexley Park - 270 townhomes, built 2005 DR Horton). What I like for first OOS:
- Landlord-friendly FL, no state tax
- 2/2 townhome $420k-$480k ARV, rents $2.4k-$2.7k, HOA $520 but includes pool/clubhouse
- Off-market absentee owners (VA/NC/IL) 12-18 yr owned - Often tired landlords with tenants in place, open to creative terms if you let tenant stay
- Light cosmetic rehab $40k-$60k vs heavy $100k+ in other FL zips
For first deal, I look for 25-30% equity left at 70% ARV minus repairs, 10-day close possible with local title, $500 EMD standard.
If FL is on your list, happy to share what I'm seeing in 33445 tax rolls + connect you with my lender (65-70% ARV) + property manager in Boynton area. I also just connected with a CPA (13 doors, REI Tax Hack) who does cost-seg on these townhomes - Super helpful for first OOS tax wise.
Where are you based now and what bad market are you trying to get out of?
- 2wAlfath AhmedBusiness MemberReal Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
Good work on getting started @Carson Tuttle
Find a good market in the midwest where your investments would make sense from both cashflow vs. appreciation.You want a market that is tech driven, landlord friendly, and affordable. That will mean more jobs, more income, higher property prices, and better opportunity for your rental to perform better.
Any state in the midwest works. Find a major city and only invest there. Connect with a good investor-focused agent who is also an investor themselves. Have him connect you with his team of contractors, lenders, property managers. Go visit the market.
Your agent will send you good investment opportunities off-market and on-market. Ask for rent comps, sales comps, info on mechanicals, and have agent find out how far on the price you guys can go to make it make sense.
Get inspection/contractor walkthrough, speak to PM on rents, and that is all.
ReafCo | Ahmed Group 533 Reviews - 2wHenry ClarkPro MemberDeveloper · Member since 2020 · 4k+ posts · 4k+ votes
OP. Your home area Salt Lake City and surrounding area. The median prices I saw were $400k to $700k depending on neighborhood. That’s pretty ordinary.
Since you’re a first time investor your best deal is not market based. It’s based on your personal situation. Describe yourself and your situation. There are lots of options where you are at. With far lower risk.
Dont need to answer.
What is your rent?
Do you own and how much?
Job stable?
Single, married, kids.
Salary Level?
Are you handy or want to learn?
Any RE or contractor relatives or acquaintances?
How much funds to invest?
etc. etc
- Member since 2026 · 5 posts · 1 vote2w
Have you tried looking at South Carolina yet? It's a great and steady market with alot of expansion. You should check out invest_with_mason on instagram, I watch his videos for tips on 1031 exchange info, insight into the charleston/sc market and just the basics of investing. Good luck!
- Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes1w
Saw Cleveland got mentioned. Thing about Cleveland is it's super cheap. You can go on Zillow and find some of the cheapest houses in the USA. However, there is a lot of risk that comes with doing that.
I recommend reading The Ultimate Guide to Grading Cleveland Neighborhoods. Investors have been using that free guide for over 11 years to lower their risk as they enter the Cleveland market.
https://www.biggerpockets.com/member-blogs/4704/42419-cleveland-neighborhood-grades
- 1wJimmy LieuBusiness MemberReal Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
Welcome, Carson, and Salt Lake City is a tough one for a first purchase, so looking at Indiana makes sense. Most replies cover which market, so here's a way to test one before you commit.
Pick two markets and ask a local agent and a property manager in each for the last three rentals they actually leased: the rent, the days on market, and what the tenant ended up costing in repairs. Then run each deal with one bad stretch built in, like two months vacant plus a $3,000 repair, and see if it still holds up. A market that only works in the best case isn't a good one for a first deal.
For a second market next to Indianapolis, in my experience Columbus single families run about $120K to $180K, though cash flow depends heavily on the neighborhood.
Happy to connect and compare notes as you narrow things down.
Jimmy Lieu, Red 1 Realty4.9121 Reviews
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