How to Buy Your First Real Estate Investing Rental Property Out of State as Beginner | Long Distance

2 года назад

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In today's video we'll be going over how to buy your first out of state rental property and talk about the step by step process I had to purchase my first.

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These are the same steps I went through to make that purchase and is something you can easily do as well.

The first step in all of this is choosing a market.

Most people start by investing in the market they are currently in and the easiest way to get started is to buy a house with a small down payment and live in it for one year. Then buy a second property and rent out the first. But, let’s say you live in a high cost of living area and that just isn’t possible.

There are some advantages of knowing an area or having someone you trust there but if I were to pick again the kinds of things I would look for would be Unemployment rate, population growth, job industries and then more specifically different neighborhoods, gentrification, crime rates.

Places to find this information would be

Now that you have your market you’ll want to zone in on certain areas. In Kansas city a fancy area is the plaza so let’s start to look there.
The things you’ll need are a

What is nice about using that kind of platform is you can see a track record, they probably have enough exposure to real estate investor that they want made an account on Bigger Pockets and are contributing in some way.

Finding a property manager can be similar steps.

Contractors are the tough part, from a distance or even if you are local but hopefully if you are networking with people who are active in the market they may have some contacts or maybe people in house. The ole tip of get to a home depot and see who is arrival early with sweat on their brow or driving around to active project can be a challenge when you live out of state.

The thing you’ll want to do is look at a crime map of the city to make sure we aren’t getting into an area that we want no part of. Some people do well in what they call D class areas or war zones but that isn’t for me. I prefer to be in more of the working class. I find these renters to be nice appreciative people and the homes are much more affordable which i also like.

Some rules of thumb people use are things like the 1% rule which just means you want to try and get 1% of the purchase price in monthly rent. So if the property cost 100,000 you’ll want 1,000 per month. This is a fast analysis which can help get rid of bad properties but doesn’t work in every market.

We got that taken care of. Now let’s see what it could rent for. You can use rentometer which does allow you to do a couple free searches but eventually you’ll need to pay if you want to keep using the service. Because of that I do a quick search on Zillow to get a ballpark idea.

While I’m there I also like to see what other properties sold for just to see if I’m over paying

Next, you’ll want to run the numbers to see if you have any cashflow.

This is a quick overview to get you started to see if you want to go further things you’d then want to get clarity on is your actually property, insurance, taxes, and interest, what a property manager will cost, are there any improvements that need to be made to increase rent or update it just a bit.

If this is just a rough estimate I’ve found the realtor.com calculator to be a good estimate on what your month payment will be.

This should have provided a good overview on how to find a market, find an area, build a team, and make a purchase. I could also have made videos over each of those topics to really dial in but wanted to provide a brief overview. If you want a video on a specific topic then let me know in the comment sections.

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