Managing rehab as an out of state investor

Managing rehab as an out of state investor

Elliot W.Pro Member
Member since 2026 · 12 posts · 8 votes

Hi all. I'm a new investor, and since my local market is quite expensive, I'm going to be investing out of state. One thing I was curious about is how out of state investors manage rehab from afar. Obviously you want to find a contractor you trust, but beyond that is there someone you would have stopping by the property regularly to make sure the work is progressing, address any issues that come up, etc? Who would that be - a property manager? Agent? I understand I will presumably need to pay someone to take on this role, I'm just not sure who the right person is to ask (and how much I should expect this to cost).

Thank you!

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Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
3d

My recommendation is to travel to the location I'm going to invest in and meet with people personally. It's much easier to gauge the quality of someone and their work by meeting them in person or seeing some of their projects, compared to just talking to somebody over the phone or via email.

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  • MD/DC · Member since 2024 · 1k+ posts · 1k+ votes
    4d

    I went multiple times during the rehab process.

  • Matthew MorrowBusiness Member
    Investor · PA - NY - NJ · Member since 2019 · 521 posts · 182 votes
    4d

    @Elliot W. The boots on the ground during a rehab is usually either a project manager you pay per job, or an investor-savvy agent willing to do walkthroughs, not a normal PM who only handles tenants. Pay on milestones with photo and video updates, not big upfront draws. Who you hire matters more than the title on their card. Do you already have a deal under contract, or are you still building the team?

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    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      3d

      Thank you, Matthew. Still building the team, and realized as I considered making an offer on a property that this was an important question that I didn’t have an answer to yet. 

  • Nicholas L.Pro Member
    Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
    4d

    @Elliot W.

    mostly there is no such person. no agent or property manager is going to step up and be your quarterback.

    instead of investing "out of state" can you invest within a couple hours of where you are? there is just no substitute for being hands-on and in person.

    or, even better - start with a house hack.

  • James JonesPro Member
    Investor · Collierville, TN 38017 · Member since 2017 · 734 posts · 543 votes
    3d

    I run rehabs in Memphis at 236 doors, and I don't personally quarterback any of them. The system does. My property manager walks the properties, lets contractors in for bids, and sends me photos. I use the same crews job after job — they know my scope, my pricing, and that I pay fast. I buy sub-$100K all-in, never put earnest money down, and the rehab budget is locked before I close. The key is sequence: hire the property manager first, use their contractor referrals, then test the crew with one small job. If they can't finish a $15K cosmetic rehab on schedule, don't hand them a $40K one. Scale the trust before you scale the dollars.

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      3d

      Thank you, James. Your emphasis on building systems and a process is a helpful way to think about this more broadly. 

  • Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
    3d

    You need either your own past used trusted contacts or for your realtor to give you their trusted contacts. A property manager's interests are opposite to yours, they want it to take longer and to charge as much as they can to maximize their fees. I have a group of contractors I refer out to clients over and over again so they will not screw anyone over as it would be a very costly loss of business to them being me giving them future referrals are tied to their success. You also need someone local to pay to check on the work as it goes, videos are nice but really need a 3rd party. I also do this for my out of state clients and have even hired my realtor teammate to do this for me when I travel and need someone check on my own rehab, its really essential even if you have used them there might be a spot that needs redoing etc. I once had a client use their own contractor and a job I could do for $25 to 30k got hustled for more and more up to a total of $70k and this was a contractor they supposedly met off BP. Many of these workers will straight up hustle out of state owners for as much as they can.

  • Elliot W.Pro Member
    OP
    Member since 2026 · 12 posts · 8 votes
    3d

    Thank you, Henry. Since I am out of state and a new investor I don’t have my own trusted contacts yet, but the framework of getting referrals who have an incentive to be trustworthy based on their existing relationships (eg with my agent) is a helpful way to think about it. And I definitely want someone to go check on the work like you said. Trust but verify. 

    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      3d

      My recommendation is to travel to the location I'm going to invest in and meet with people personally. It's much easier to gauge the quality of someone and their work by meeting them in person or seeing some of their projects, compared to just talking to somebody over the phone or via email.

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  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    3d

    Welcome, Elliot, and planning the oversight before you buy puts you ahead of most first-timers. The replies above cover building the team, so here's how I'd structure the milestone checks.

    Tie every contractor draw to a milestone you can verify: demo done, rough-in plumbing, electrical and HVAC done before drywall, drywall, finishes, final. The pre-drywall stop matters most, because it's the last time anyone can see inside the walls. At each milestone, have an independent person, like a local inspector or a project manager paid by the visit, walk it on a live video call and send dated photos before you release money.

    Also put in writing that any change in scope needs a signed change order with a price, and check permit status yourself on the city's website. Those two habits catch most surprises from a distance.

    I enjoy networking with investors working through this, so feel free to connect and I'll see where I can help.

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      3d

      Thank you Jimmy, this is all very helpful! I will DM you to connect as well.

  • Real Estate Investor · Memphis, TN · Member since 2016 · 417 posts · 140 votes
    3d

    @Elliot W.

    I would consider a couple of things.

    1 - Will the General Contractor you hire complete ever single Item?

    2 - If your GC needs specialty work subbed out[Counter Tops, Chimney Maintenance, Garage Door Repair or other Specialty Items)

    • Can your GC run Point on those Items Yes/No.

    3 - Can you Meet the GC in person at the Start, Middle and Finish of the Project?

    4 - Use A local Hard Money Lender that will walk the property before releasing Funds

    5 - Reporting

    • What is will the reporting look like.

    • Day-to-Day may be too frequent,

    • Weekly

      • Start the Week

      • End of Week

    • How are you tracking the work and progress?

    During my first project, I have used Monday.com to keep track the project. Track the budget, milestones and timelines. The GC has provides the Master SOW and I track it when changes are made. Because of a situation were we needed some specialty work completed. Keeping things inline helped keep the project on track for the most part. So Far it has really helped me stay on top of the project, while communicating with the GC a couple days per week.

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      3d

      This is great. Thank you Jamie!

    • Real Estate Investor · Memphis, TN · Member since 2016 · 417 posts · 140 votes
      3d

      Where are located and where is your project you are planning to manage? I would suggest, if possible connect with a Local REIA or Investor Community. They may have some resources that could ease the stress a little.

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      3d

      I'm located in CT, looking to invest in Cleveland and Pittsburgh. I will look into those - thank you!

  • Divin KanyamaBusiness Member
    Accountant · Seattle, WA · Member since 2025 · 421 posts · 167 votes
    3d

    @Elliot W. Managing a rehab from out of state is definitely possible, but it helps to treat local oversight as a separate role from the contractor doing the work. A property manager or investor-friendly agent may help with occasional check-ins, but for a larger renovation, a local project manager, owner’s representative, or experienced construction inspector is often a better fit.

    The key is building a system that does not rely on trust alone: a detailed scope of work, milestone-based payments, permits where required, weekly photo or video updates, lien waivers, and independent walkthroughs before major draws are released. For significant work, periodic inspections by someone who understands construction can catch problems that photos may miss.

    Cost will vary by market and project size—some people charge per visit, while others charge a flat fee or a percentage of the rehab budget. Rather than choosing based only on price, look for someone independent of the contractor, experienced with similar projects, properly insured where applicable, and willing to provide clear written reports. For a first out-of-state rehab, paying for stronger oversight can be money well spent and a good way to learn the market without being completely dependent on one person.

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      3d

      Thank you Divin. This is exactly what I was looking for - I really appreciate it!

  • Realtor · Memphis · Member since 2021 · 48 posts · 26 votes
    3d
  • Homeowner · Fort Collins, CO · Member since 2026 · 4 posts · 2 votes
    3d

    Hi Elliot, welcome — I'm in Fort Collins, CO, and I'm in the same boat as a beginner learning all of this for the first time, so take my thoughts accordingly. One thing I've picked up as a homeowner is that getting the scope of work in writing before anything starts has saved me more than once. Itemized bids make it a lot harder for a project to quietly balloon, and that seems even more important when you can't swing by the property yourself.

    The milestone-based payment idea folks mentioned here really resonates with me. Paying for completed, verified work instead of large upfront draws seems like the single biggest protection for an out-of-state investor. I'd also ask for dated progress photos on a fixed schedule so there's a paper trail. Good luck with Cleveland/Pittsburgh — planning the oversight first like this seems like exactly the right instinct.

  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
    3d

    Elliot, for an out-of-state rehab, I’d definitely have someone local checking on the property regularly rather than relying entirely on the contractor to police their own work.

    Depending on the size of the project, that could be a property manager, owner's rep, GC, or another trusted local person. The important part is having someone who can physically verify progress, catch issues early, document the work, and keep the contractor accountable.

    I’d also build the cost of that oversight into the deal from the beginning. Saving a little on project oversight isn't worth much if a problem sits unnoticed for three weeks.

    One other thing I'd recommend from day one is keeping very clean records of the rehab. Track the invoices and scope of work by project, because repairs and capital improvements can have very different tax treatment, and you'll want a clear record for basis and depreciation once the property is placed in service.

    For an out-of-state investment, I'd think about the local operating team and the tax/bookkeeping system together. Both become much harder to fix after the rehab is finished.

    Feel free to DM me, I’d be happy to send over a few resources that might be helpful.

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  • Mark UpdegraffBusiness Member
    Real Estate Broker · Rochester, NY · Member since 2010 · 1k+ posts · 703 votes
    2d

    @Elliot W. We handle this regularly in Rochester. Our businesses cover real estate sales, property management and general contracting, so we see the project from acquisition through renovation and leasing.

    When we act as GC, that’s a separate, more hands-on service above and beyond our normal property-management scope. I think that distinction matters when you’re hiring someone locally.

    A property manager or agent might be able to help, but I wouldn’t automatically assume renovation supervision is included—or that they have the construction experience to do it well.

    For anything beyond a simple renovation, I’d want clear responsibility for the scope, schedule, subcontractors, change orders, progress verification and final completion. The owner should know who is accountable, what reporting to expect and how payments tie to verified milestones.

    That’s the white-glove part: someone locally owning the process instead of leaving you to coordinate everything from several states away.

    What market are you considering, and what’s the approximate renovation budget? The level of oversight you need changes quite a bit with the project’s complexity.

  • Property Manager · Southfield Mi · Member since 2018 · 185 posts · 173 votes
    2d

    There are 3 major keys to successfully investing while out of state:

    1. You must connect with local professionals who have your best interest at heart.

    Many realtors, Property Managers, contractors, brokers, lenders see you as a fast dollar or meal ticket. They will happily sell you a dream and drag you along until you either run out of money or figure out what is going on. There will be many smiling faces, polite conversations, professional exchanges intended to lull you into a relationship. The people you want to deal with won't just have great conversation and "systems".. The pros you want to deal with are actually engaged in your target area on a day-to-day basis. They can break down a city off the top of their head neighborhood by neighborhood. They know values, crime rates, tenant pools, rehab costs, municipal codes. You want someone who will point you to a great deal and away from bad ones. Good team members are always figuring out ways to help you win not just looking out for their own bottom line.

    1. You have to clear any preconceived ideas you have about out of state communities. You must not super impose what you are used to, or what your native city or community is like on other cities.

      Too often a local professional has to arm wrestle with an out of state client who absolutely believes that we live in a homogenous country where everything is basically the same. It's absolutely not. Preferences, theft, tenants, municipal codes and requirements, weather are extremely local. Understanding this will help you avoid mistakes that you wouldn't make otherwise.

    1. Avoid the urge to fall in love with a property

    This ties into the first point about having local navigators. Quite often Out of State investors will come to an unfamiliar place, look at a property the sparks start flying. Ideas rush to the forefront of your mind and the vision crystalizes-yep, not the best thing to do when you don't fully understand the area. Once this happens it takes a ton of energy to get you off the property and if you stubbornly move forward anyway after receiving advice not to the blame will often shift to your team when in fact it was just not the best deal.
    If you ever decide to look into Detroit Michigan we would be happy to help you out.

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      2d

      Thank you Leroy! All helpful advice

  • Alfath AhmedBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
    2d

    This is a very good question @Elliot W.

    A lot of first time/new investors are confused on how OOS investing works and it can be tricky but if you can build the right team around a 1 superstar connection then it usually becomes pretty easy.

    I invest in Columbus and own 30+ units here and work with OOS investors. I typically connect my buyers with GC's that I have personally worked with and those GCs have also done a ton of work with other OOS investors.

    Usually payments are divided into the project duration. I pay contractors every Friday but only pay after they completed the plan as per the scope of work. Once they send photos/video walkthrough I send payment.

    Other licensed contractors also have on-site project manager which I also connect my clients with who need a bit more hand holding. Make sure to hold the last payment until blue tape walkthrough and make sure everything is complete and the contractor has been honest the whole way through.

  • Leo SteinBusiness Member
    Property Manager · Orange County, CA · Member since 2025 · 94 posts · 27 votes
    2d

    Lots of good advice above. One angle from the property management side: the person who walks the job doesn't have to be the person who manages the tenant later, but it helps when they're the same team.

    Some PM companies will oversee a rehab for an hourly rate or a percentage of the job, and it's worth asking because they'll be living with the finished work. A manager who has to take the service calls afterward tends to catch things a contractor might gloss over, like cheap fixtures that break in year one.

    Whoever you pick, a few things keep it honest:

    1. A written scope with line items, and draws tied to milestones, not dates.

    2. Dated photos and a short video walkthrough at each draw, taken by your person, not the contractor.

    3. A weekly 10-minute call with the same three questions: what got done, what's next, what changed.

    4. Permits pulled properly, and a final walkthrough before the last payment.

    Cost varies a lot by market, so ask two or three local PMs what they charge for oversight and compare.

    Happy to compare notes by message.

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    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      2d

      Thank you Leo! This is very helpful

  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 952 votes
    2d
    Quote from @Elliot W.:

    Hi all. I'm a new investor, and since my local market is quite expensive, I'm going to be investing out of state. One thing I was curious about is how out of state investors manage rehab from afar. Obviously you want to find a contractor you trust, but beyond that is there someone you would have stopping by the property regularly to make sure the work is progressing, address any issues that come up, etc? Who would that be - a property manager? Agent? I understand I will presumably need to pay someone to take on this role, I'm just not sure who the right person is to ask (and how much I should expect this to cost).

    Thank you!

    Managing a remote rehab successfully comes down to building a reliable local team rather than trying to micromanage from afar. While some investors pay a third-party project manager or property manager a fee (typically 5% to 10% of the rehab cost) to conduct weekly site visits and verify milestone completion before releasing draw payments, the best setup is partnering with a boots-on-the-ground team that offers integrated contractor oversight. That is a major reason why so many out-of-state investors lean into Midwest markets, where entry prices leave plenty of cash flow margin, and local teams handle direct project oversight, photo/video draw inspections, and property management handoffs seamlessly.

  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    2d

    As soon as most contractors find out your OOS:

    1) You are NOT a priority

    2) They will cut corners

    3) Work will take longer

    4) Scope of Work (SOW) will grow as the "find" things to add, that you can't see

    5) Quality will suck

    6) You may find them charging you for materials they use on other jobs

    7) Break-ins resulting in stolen materials mysteriously happen, yet they won't file a police report

    A lot of this we've seen contractors try on us and we are LOCAL!

    How are you going to catch all this?

    Depends on how much construction experience YOU have!

    You can hire people to check on things, but how are you going to understand what they are telling/showing you?

    You can try to use one of the following:

    1) A home inspector - should be the best option, but they may also cut corners

    2) A real estate agent - most aren't builders, so easy to fool

    3) A Property Management Company - depends on how much construction experience they have

    4) Personal contact - how much construction experience do they have?

    5) Yourself via flying here - how much construction experience do you have?

    No easy answers...

    • Elliot W.Pro Member
      OP
      Member since 2026 · 12 posts · 8 votes
      1d

      That all makes sense. I don't have much construction experience, so even locally I wouldn't necessarily be able to prevent many of these problems. It sounds to me from the potential solutions you listed like the key is to find someone who DOES have legitimate construction experience, so they can monitor progress and also not be fooled.

  • Min ZhangBusiness Member
    Real Estate Agent · Member since 2022 · 1k+ posts · 1k+ votes
    1d

    Hi Elliot! I think having someone local check on the property during the rehab would be a big help. You could look into hiring a project manager or someone who can make regular site visits and send you updates and photos. I’d also tie payments to completed stages of the work and make sure any extra work or changes are agreed on upfront. That way, you have a better idea of what’s happening even when you’re not there.

  • Investor · Member since 2026 · 3 posts · 2 votes
    1d

    I’m going through this now, make trips or have a property manager you have more than adequate communication with

  • Member since 2025 · 248 posts · 101 votes
    1d

    @Elliot W. Welcome to BP! Out-of-state rehabs need "boots on the ground." Use a PM (10-15% of rehab) or agent ($50-100/visit) to verify milestones before releasing draws. Good luck!

  • Elliot W.Pro Member
    OP
    Member since 2026 · 12 posts · 8 votes
    21h

    Thank you everyone! I have appreciated all of the helpful advice so many of you have given. I wanted to share my summary of the points that everyone made in this thread, to hopefully help anyone else learning this process like I am.

    1. Vet the contractor - use contractors recommended by local investors (which you can meet through a REIA or local investor community), agents, or PMSs who have ongoing relationships, in part so the contractors have a bigger incentive to be reliable and do a good job. Start small by testing a contractor with a smaller rehab before trusting them with a larger one.

    2. Hire local and independent oversight - hire someone to independently verify progress, such as an investor friendly agent, property manager, project manager, owner’s rep, inspector, etc. Ideally someone with construction experience, so they know what to look for. Don't assume an agent or property manager will take on this responsibility without an explicit agreement. Clearly define the responsibilities and compensation for this role. It may help if it’s the PM who will be managing the property, as they’ll have to live with the finished property.

    3. Visit if possible - visit the market to meet contractors, potentially see previous work, and establish relationships. Consider visiting regularly, or at least at the beginning, middle, and end of a project, to avoid being taken advantage of as an out of state investor. 

    4. Establish a detailed scope of work - finalize an itemized scope of work with costs, completion milestones, contractor responsibilities, and permit requirements. Build in a contingency for unexpected expenses.

    5. Have a system for tracking progress - establish clear systems for tracking progress with the contractor and the independent oversight person. Require dated photos and/or live video calls on an agreed-upon schedule from the independent oversight person, and use a shared tracking system with the contractor to monitor progress against the schedule and budget (possibly using project management software such as ). Communicate with the contractor regularly, and at each contact ask what’s been completed, what’s next, and what changed. Also ensure inspections by the independent oversight at important milestones, especially before work is concealed (e.g., plumbing and electrical behind before drywall is closed up). 

    6. Define payment procedures that protect you - release payments according to completed milestones rather than large upfront deposits or arbitrary dates. Don’t rely exclusively on the contractor’s reports to release payments; have the independent person send dated photos and/or have live video calls, and check permit status on the city’s website. Require written and signed approval, with pricing, before any change orders. Retain invoices and records for tax purposes.

    7. Develop the system - over time, develop repeatable processes for all of the above so that managing remotely becomes easier as relationships develop.

    If I left anything important out, please let me know.

    Thank you again everyone!

    • Nicholas L.Pro Member
      Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
      21h

      @Elliot W.

      Here are my responses to your notes.

      1. Vet the contractor - use contractors recommended by local investors. Yes.

      2. Hire local and independent oversight - hire someone to independently verify progress. This is the one I'm most skeptical of. There is just no such position as this. No random PM or random agent is going to do this for you. I guess it's possible you could somehow find and hire the right person, but you'll have to build the network first. You are not finding this person on the Internet.

      3. Visit if possible - visit the market to meet contractors, potentially see previous work, and establish relationships. Yes. But not "if possible." If you can't visit, don't do it.

      4. Establish a detailed scope of work - finalize an itemized scope of work with costs, completion milestones, contractor responsibilities, and permit requirements. Build in a contingency for unexpected expenses. Yes, if possible. But no contractor is going to agree to an investor favorable SOW with a brand new investor on their first project. It's going to be favorable to them, not you. They'll happily not work with you if you push for too much.

      5. Have a system for tracking progress - establish clear systems for tracking progress with the contractor and the independent oversight person.  Almost no contractor is going to participate in this. They are too busy.

      6. Define payment procedures that protect you - release payments according to completed milestones rather than large upfront deposits or arbitrary dates. Again, likely not happening on your first few projects unless you have a very large rehab that makes it worth their time.

      7. Develop the system - over time, develop repeatable processes for all of the above so that managing remotely becomes easier as relationships develop. Yes.

  • Real Estate Agent · Detroit, Wayne County · Member since 2026 · 12 posts · 8 votes
    18h

    Elliot, yes — if I were rehabbing from out of state, I would absolutely want somebody local who is independent of the contractor checking the property and the progress.

    I’ve overseen projects for clients where my role was essentially to be their eyes, ears and feet locally. I like the rehab broken into clearly defined phases, with a written scope for each phase and payments tied to completed work. Before the next draw is released, I want to verify that the previous stage was actually completed.

    I’d also want regular photos/video, site visits at key milestones, documentation of any changes, and a clear approval process for anything that increases the budget. One of the easiest ways for an out-of-state rehab to get away from you is when changes start happening verbally and money starts going out without anyone independently confirming the work.

    Whether that person is an agent, project manager, property manager, or another local professional depends on the individual and exactly what services they offer. I wouldn’t assume every agent or PM wants to take that role on. What matters is having someone local who understands construction well enough to recognize whether the work matches the agreed scope and who represents your interests, not the contractor’s.

    As far as cost, I’d negotiate that separately based on how involved you expect them to be — occasional milestone inspections is a very different job from actively managing contractors and the entire renovation.

    I’m in Metro Detroit, and this is actually something I’ve done for clients when they needed local oversight. If this is one of the markets you’re considering, I’d be glad to connect and compare notes.

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