Investing out-of-state fears - Posted by JC(CA)

Posted by Sailor on May 02, 2006 at 22:27:41:

I started investing in coastal NC while still living in Calif. For years I rented solely to retired couples (mostly from the NE) for a year or so while building their dream homes. These shorter-term tenants never made a late rent payment or put a nail in my walls. However, prices have increased dramatically, so if you are using financing it is difficult most places to get positive ca$h flow on SFRs. Appreciation is terrific, though, so it is a good place for 401k funds.


Investing out-of-state fears - Posted by JC(CA)

Posted by JC(CA) on April 30, 2006 at 15:30:50:

My of my friends suggested against going out-of-state to TX, FL etc. They told me about horror stories about their eviction and places trashed(cost 10K to 20K) to fix and lost in court to evicted tenants due to roof leak. Those problem tenants were nurse and good working proferssional.

Apparently screening tenants are important and very crucual, plus finding a excellent property management co. are equally important since you cannot keep flying every months. What states are landlord friendly: TX, GA, FL, AZ?

They told me to stay close to where you live(in which I agree) but in CA, that is very hard to cashflow.

I am interested in either buying duplex/4-plex in GA/TX, of a small MHP. Other safer investments might be buying tax liens, or land investment.

Re: Investing out-of-state fears - Posted by Nancy Dallas

Posted by Nancy Dallas on May 15, 2006 at 24:06:56:

I’m in Dallas, I’m currenly own mostly SFHs and a small apartment, am looking for money partners to get into bigger deals, I’m also interested in MHPs… sent me an email if you are looking to work with local investors in TX.

Nancy 214-206-1850

Re: Investing out-of-state fears - Posted by JR

Posted by JR on May 08, 2006 at 09:16:22:

As a member of the military, I have moved every 1-3 years for a long time. For SFRs, my opinion is that you just have to find a local manager you are “comfortable” with. You may have to change management a time or two in an area, but there is competent management out there. Another challenge in my opion, is learning the local market. I mention this because a $50k property in TX or GA, could be worth $1 million in parts of CA. Property taxes also vary greatly by location. I have similar properties in TX and AL. Annual taxes range from $480 (AL)-1600 (TX). You also need to consider your exit strategy. I know areas in TX where you can buy 4 plexs for under $300K and they will cash flow nicely (depending on military deployments), but you may only get 1-2% appreciation, making it difficult to sell and cover any commissions on a short term hold.
I am currently overseas again, but satisfied with my local managers.
Good Luck,

Re: Investing out-of-state fears - Posted by Mark (SDCA)

Posted by Mark (SDCA) on May 05, 2006 at 13:50:35:

Very hard to handle multi-families out of state without a PARTNER on the ground. Not an employee but a partner- preferably a family member or someone else that you trust implicitly. For SFRs someone on the ground is not so criticial. For multis like you are describing, it’s NOT easy.



Re: Investing out-of-state fears - Posted by Carlos

Posted by Carlos on April 30, 2006 at 23:45:59:


I live in the Dallas area, and I’ve lived in San Antonio and Austin as well. Shoot me an email if you are interested in potentially working with a local contact that can be your eyes and ears on the ground.


Re: Investing out-of-state fears - Posted by Randy

Posted by Randy on April 30, 2006 at 17:55:50:

As a residential landlord with some 10 years under my belt, I can not imagine owning apartments out of state, but NNN commerical is another matter…

I would add that I think this is a time to be a seller, not a buyer of CA real estate.

Re: Investing out-of-state fears - Posted by JC

Posted by JC on May 01, 2006 at 24:39:48:

Many people that I know now own out-of-state with local management in place.

CA market in down right now. I am waiting to buy a 2nd home and rent out the current one. But in the meantime, I would love to try out-of-state. I do have a few contacts and need to talk to them. Essentially try to find below market deals so going in with equity. My main thing is to find excellent PM there in TX with some backup PM’s in case the first one didn’t work out. However with higher tax and ins. there, I am also looking elsewhere like GA, NC etc.