All Forum Posts by: Andrew Fingado

@Julie M. Welcome.  It's always nice to see other bay area folks join this site.  

@Mark Boek is the price firm?

@Joe Villeneuve   Thanks for the kind words.  I look forward to the next deal as well.

Thank you.  Its great to hear a local like yourself tell me I made the right choice.  I think the key to successful out of state investing are the people you work with and, like you said, the area you choose.  You can change your property manager, you can get a new real estate broker, but you can't change the location.  

@Scott K. Thanks for the warm welcome.  

Currently I am investing in Livonia.  I bought a single family home there that Joe set me up with.  Bought it way under market value.  It has at least 40K+ built in equity.   He walked me through everything and answered every question I had.  Stand up guy for sure.

@Orion Walker Happy to jump in here.

I decided against California to invest in because the bay area market just didn't make sense in relation to my overall investment goals.  The best cash flow I can get would be in areas i'd rather not deal with, and I could get the same monthly cash flow out of state for 1/4 of the price.  

So I began investing out of state in Ohio and Michigan some months back and so far, things are going well.  The neighborhoods are NOT war zones at all and the properties i've bought all fall between 25K-45K.   One thing I can say about investing out of state is you really need to make sure you team up with people that really know what they are doing.   @James Wise and @Joe Villeneuve have been two people that i've worked with, and I couldn't have asked for better folks to be on my team.  A lot of the stories you hear about people getting screwed out of state are those who didn't do their homework and jumped in too quickly because the numbers looked good.  Or they used a shoddy turn key company.  I spent the better part of a year rigorously researching neighborhoods, numbers, and specifics before I decided to buy my first property.  I also made sure the guys I am working with have a solid reputation in the real estate community, experience, and high knowledge of the area.

Obviously the biggest benefits of investing out of state are high cash flow and low cost for entry.  The disadvantages are the repair costs/capital improvements can really eat into your cash-flow.  There's also longer vacancies, taxes can be kind of lopsided and the weather back there can cause some issues.  Plus there isn't nearly as much of an appreciation factor.  That being said, I couldn't be happier with my decision investing out of state.  I couldn't get financing so it was a good option for me (paying for houses cash, getting my income higher, then I can refinance).  

I really tried to convince myself to buy in California but I couldn't justify buying here.  I had a set amount of money to spend with no financing and it just made more sense to buy 4-5 houses out of state that bring in 2k + monthly net income versus buying 1 house out here in a bad neighborhood that brings in maybe 700 bucks a month net.  Then I have the tenant issues to deal with.

I do hope to invest in my own backyard one day, but i'd like to get consistent cash flow from out of state income properties first.  Once I have a nice stream of income going, I can bet on appreciation out here and play it slow and steady while my tenants pay off the house for me.  I think theres benefits to both in and out of state investing but it depends on what your goals are and where you are at right now in your investment career.

I always check landlord references.  

If i'm leasing a unit in a rent controlled city I also make extra sure I check references from their previous landlords from years back.  The reason being is that their current landlord might be so eager to get them out, they will say anything positive just to get rid of them.  Either because the tenants are problematic and they want them gone, or they've been there for too long and the landlord wants the unit back up to market rent.

As for personal references however, I find those tend to be pretty useless.  I mean, the tenants are choosing people they know will put in a good word for them.  That being said, I still usually call a few up.  Never hurts to have as much information as you can.

@Suzi Padierna I'm also interested.  

Thanks for the mention Anderson.  I'd be more than happy to talk to others looking to get their feet wet going out of state.

I'd like to see what @James Wise has to say about this.  I've been taking my California money and putting it out in West Cleveland with his help and so far things are running smoothly.  Most of the properties I am buying fall around 25-45K and most have wear and tear but are not dumps, no section 8, and are not in war zones.  

In fact the neighborhoods are pretty safe and although the area doesn't seem to be growing, it doesn't seem to be going downhill either.  Like another poster said though, good management really does make or break a lot of these investments. As a property manager myself, I know a good one when I see one and James knows his stuff.