Your Step-by-Step Guide to Buying Out-of-State Investment Properties
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- เผยแพร่เมื่อ 26 มิ.ย. 2024
- 0:00 Intro
3:12 Getting Your Hands on Good Data
5:09 The Investment "Spectrum"
11:44 Why is Cash Flow So Hard to Find?
19:06 Seeing Your Cash Flow in the LONG Run
23:32 Balancing the Benefits of Real Estate
27:22 What Makes a Market Appreciate?
36:35 What to Look for in a Cash-Flow Market
38:46 Found a Great Market, What's Next?
1:01:28 Furious Four!
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Buying out-of-state rental properties may be common for some investors, but it's not uncommon for many investors to start out buying properties in their home markets. It makes things like neighborhood research, rehabs, and tenant showings so much easier when you’re only a short drive away from your property. That’s how Dave Meyer, VP of Data and Analytics right here at BiggerPockets, feels.
Dave is currently living in Europe and has invested exclusively in Denver, where he used to call home. Now, as an entirely remote landlord, he’s seen the data on how many markets (like Tampa, Florida) are doing phenomenally for appreciation and rent increases. David Greene, out-of-state investor and the man who literally wrote the book on long-distance real estate investing is here to offer some much-needed council.
Plus, they talk about the new tool, our Agent Finder, and how it connects you with investor-friendly agents based on your investing location, strategy and readiness to buy!
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Join BiggerPockets for FREE:
www.biggerpockets.com/signup
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Take Advantage of BiggerPockets Insights:
www.biggerpockets.com/insights
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Find the Perfect Agent for Your Next Out-of-State Purchase:
www.biggerpockets.com/agent/
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Cash Flow vs. Appreciation:
www.biggerpockets.com/blog/20...
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Grab David’s Book “Long-Distance Real Estate Investing”
store.biggerpockets.com/produ...
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Connect with David and Dave:
DG: @davidgreene24 or / davidgreene24
DM: @thedatadeli or / thedatadeli
Episode #515
Show notes at: www.biggerpockets.com/show515
If you are reading this right now, I wish you the most ABUNDANT year of your life.
which year?
I am all the way down in Pretoria, South Africa and want to thank you both for the amount of value I got from this one video, you guys are awesome
Excellent presentation, loaded with useful pragmatic insights. Thank you David!
Just closed my first multi family property today due to this man and his book including many other mentors like ken McElroy and my main guy, Robert Kiyosaki.
Fantastic thank you! Those questions to ask potential realtors is gold!
Such a good one! I know exactly what to do next. The format and recaps helped me process all the great insights.
One of the best podcasts I've listened to. Thank you for doing this!
Thanks David and Dave for great show. took lots of good notes on your suggestions.
@25:36 cash flow is important especially if it’s old houses. Pipes fail, water heaters, mature trees create problems. Your break fix budget better be big in those markets or there is sufficient cash flow to pay for expensive damages from old house problems or once in 100 year weather events
Your conversation is well explained. Thank you very much for detailed explanation.
That was amazing guys! Thank you so much!!
Great episode! So many good nuggets! 👊
I love the football references. Always on point.
Excited to listen to this one.
This was great. I got some good info on how to go about locating outside of my own market along with the steps. Especially Liked David’s wisdom in interviewing property managers and Dave’s questions that were so relevant. I am definitely going to check out BPs insights since Dave is a part of that. Dave’s videos that I have see this far have been super valuable thanks guys
Loved this episode! Thanks for all of your help!
Very nice episode! Love the information, the laughs, and realistic information! :) This is exactly what I needed. I can use all these tools for my real estate purchases.Thank you for no holds barred information. Truly appreciated.
Thank you so much for this insight, I was also looking at TX for long term rentals.
I'm a bigger in the learning stages of investing. I'm learning more everytime I watch. Thank you.
Great job guys! Thanks.
I’m reading through the book right now! Great stuff
Great show guys,very informative
Great content. love how you covered almost all relevant and crucial factors!
Bigger pockets is the best everything for investors. Love the pod casts , love the books Brandon and David both write
Awesome information thank you!!
I have lost so much in the stock market and stupid mutual funds. Wall Street is the only one getting rich. You give sage advice. I bought in San Diego which you will probably not make money so I bought in Houston which is doing okay. I will not give up. Thank you guys!! So true about property management 😅
Loved this episode, very insightful! Wished y’all would have talked more about finding a lender out of state/the process of obtaining a loan out of state. That’s something I struggle with.
Happy to help.
ask the seller's realtor. they have a vested interest in getting you into a loan :)
You guys are awesome! I always learn so much, your content helped push me to start a renovation company last year! I’m in Denver (Aurora) it’s a great market here and I’m just finding my way into being a property owner !
I have two out of state rentals, a SF and DUP. Can’t wait to listen!
I loved this episode, shoutout to the algorithm!
So much helpful information! Thank you guys! *Aloha*
Most beneficial video ever. Wish i had this when i was looking for an agent! David Greene dropping GEMS
The football analogies and the topic made it feel like this one was just for me. Thanks David "Big Money" Greene
🔥 🔥 🔥 Great episode
This was exactly what I needed. Moving to Europe I’m 2 months and want to invest long distance too!
One of the most eye opening podcasts on real estate…..David drops so many tips that made me change my strategy on some many areas of rei. Thanks guys keep it up !
Great info!
Great episode!
Love it!
I kept thinking of this episode after watching it and one thought kept coming to me. Invest in areas that laws to increase minimum wage have passed, but not been enacted. This will mean rents and property values will increase in a couple years.
So u mean state or federal law?
@@alvinsingh9750 state. Like Seattle did a few years ago. Like NY city did a few years ago, and upstate NY is in the middle of now. So more locality. Federally won't change much except in states where it is lower.
@@JasonMorford where to check if laws are going to change in a particular county?
@@karanspi123 really just the news. You can also look at places in that state that had wage increases the last time and see how long it took home values to increase.
@@JasonMorford thank you
I’ma from Rochester so it’s a great surprise to hear you went to school here
Love it!!
Loved it
Simply awesomeness
More of this stuff! I live in Hawaii and housing prices are insane!
This one of the best I’ve listened so far! Keep up the great content..!
Another factor to consider long term is good clean water supply
Love this show lots of useful info. Love from jamaica 🇯🇲💯🔥🔥🔥
Dude must love the mary Jane... Denver to Amsterdam... nice!
Great show guys.
I feel so bad about how home prices kept rising since 2011. In 2010, one realtor told ne that it is not a market for flipping. I took his words and never checked the market again untl 2019 when I found out that the prices have risen considerably. Had I known that I would have bought a property back in 2014.
But I dont want to miss this time
Great convo boys
Great episode! I am curious to know more about your lending business.
Very informative
Dave you are doing a great job 👏 I love this style of podcast!
Thanks Edwin, I really appreciate that!
Excellent podcast with relevant information for investing today. Bravo!👏🏼
Great video!
thanks for the info. picked up a good couple of points
Thank you for the good wishes. You know one area that I’m not seeing you discuss or consider especially advise , is the older adult. I’m a very active baby boomer, 70 y/o. I need desperately more short term advice. FYI u guys are good teachers. T hank you….
Good show! Show idea-a show for people who are new to real estate investing, but that would prefer to find services/people to do the investing for them. So they don’t have to learn everything from the ground up and then risk making rookie mistakes? If so, how do you find these services/people who can invest for you, but that also know what they’re doing so you don’t lose your money? How do you check their track record. CAN you check their track record? How do you vet them? There are so many moving parts to investing in property…. I would think a lot of folks would need that kind of help.
23 minutes into this. When are we going to actually talk about out of state investing?
Omg right??
I wish I can find a duplex for $150k in a nice neighborhood with good rent and equity appreciation. Ideally a brand new one.
Excellent discussion! I learned so much from you guys! Thank you so much!
I wish they would’ve talked more about travel. How often are you on the ground there? Do you physically meet with any of the furious four? Is David doing everything out of state?
I like David’s wisdom in interviewing property manager and real estate agent and what questions to ask. That’s very helpful as a new investor looking to invest out of state.
It was not a hijack when you ask the right questions. Also, Funny how y'all mentioned Atlanta as a growing market; looking at most movies at the end credit seen I'm always noticing that Georgia peach logo. Which for the entertainment industry is huge which means jobs, which means ppl will need housing.
How do you go about researching different markets? Such as population growth, jobs/wages, movement of companies
I watched this and now own the state of Alabama
Rents AND appreciation can easily stagnate for years. Most youngish folk may not realize this. Pair that with I/O only loans, you don't get principal reduction.
How does one get on to the bigger agents? Do they go through some vetting process ?
I heard “there’s very little cash flow out there” a few times. When I look, I see cap rates of 8%+ everywhere. I’m now to the CRE market. Is that not good enough? Were times better recently?
1:09:10 - I’ve been looking at investing in Texas but people are scaring me about property tax increases ?how much of a worry is that ?
I can be your a Agent in Utah David! Any day of the week! I know my numbers! Know my neighborhoods! I know the best contractors who can get rehabs done for minimal costs! I have appraised houses in the past!
I KNOW my numbers and how to analyze a deal! 😊😊😊😊
For out of state purchases, how can you determine the value of the neighborhood?
I'm interested in a property in Syracuse new york listed at 199k i live in new jersey. It's a 2,2 and 3 bedroom apartment and 2 store fronts 100% occupied. Not in the greatest of neighborhoods but it cash flows
Sorry, but you don't know Kansas. KCK, Wichita, Johnson County, have constrained growth areas. I have an 8 plex in Wichita that has appreciated by 100% in 5 years. Why? Wichita is constrained by other cities, a.k.a suburbs, and graphical features of the land. You can't build along a river the floods every year or over an area that you reach rock within a foot of the top of the soil. What really drives the cost of building new is zoning, labor and material costs. If you build large then you then you can get a benefit of scale.
South Tampa is great but some areas in Tampa not soo good
I thought breaking up units were an insurance liability, unless you change the certificate of occupancy.
Seminole Heights is a hot market in Tampa
Would it be in my best interest to sell a property that iI have reached the end of the depreciation
Dave & David, my 2 favorite BP personalities
Thanks Kevin!
Im a university student in Miami (born and raised here) with a bit of a construction background due to work experience and family, and I was glad to see some of my concerns touched on in this podcast. I figured rehabing or developing for equity was the way to go here due to the market, but I am more interested in gaining cashflow as a long term financial plan.
I can see the sense in doing so to hold out for a 1031 into a cash flowing area, but I am interested in checking out these high cash flow areas in Florida that you guys mentioned, to start, in order to gain some experience with property management and the law, so I dont make a serious mistake down the line attempting that
David! you have so much to teach me but I know absolutely nothing about football! Please please consider more video game analogies😁
Got some good idea on why people pay with low on return cause they use tax saving
Interested in an ocean front condo on Daytona beach. Bad thing is HOA is any where from 500-900 a month units range from 150-250k. I know it will be a great short term rental but don’t know if it’s an actual smart investment for cash flow or long term.
Make sure the HOA allows short-term rentals.
If I buy $800K house in Dallas area & my rent is around $5K. Do you think it will produce a cash flow? I am a newbie, any help will be appreciated.
Need a show on how to choose CPA's now, lol
Moving out to the mid west to invest...
Be sure you look at the real estate taxes before you buy. Ohio and Illinois are ridiculously high. In Cleveland, you can pay $5,000 per year in taxes on a $120K house.
Indianapolis is where I'm throwing my money. I would suggest checking it out. I'm getting great cash flow and watching the rehab of the city explode
@@Randalllac I'd love to hear more about what type of projects you are working on. I'll be moving to Springfield Missouri when my 2 properties in Oregon close.
Loved the episode, very helpful, but for those of us with zero knowledge of/interest in football, the football analogies are meaningless.
GREAT VIDEO!
QUESTION: Investing remotely, how do you manage access to the property? After you close and before the property manager takes over, who holds the keys? Who lets in contractors and other people who need access? Thanks
i use my agent and pay him hourly for doing things like that
the property manager can do all of that
Left out two negatives about Texas. Highest property taxes in the nation, and an unreliable electrical grid.
You mean your power doesn't go out every Tuesday at noon?
Hi! This info is amazing! I am a new investor and I own a property free and clear in VA. It is valued at about 360K. I have equity and want to do a cash out refi. I am prequalified for a 250K loan. I have to come up with money for the down payment & have 2 options to buy my next rental property:
1) Buy a property < 250K and pay cash with the loan.
2) Buy a property > 250K. Use the cash out refi for the 20% down payment (30yr Fixed @ 4.87%) and a conventional purchase loan with a lower interest rate to finance the rest. (30yr fixed @ 3.25) The goal is to finance 100% of this purchase with 2 loans. I have been pre Q for both loans already.
*Which scenario would you recommend?
*How can you calculate cash on cash and ROI when you finance 100% of the purchase and have 2 mortgages or when you pay in full but still have the cash out refi mortgage? THANKS!!!
@BiggerPockets Thank you! however, my question is regarding running the numbers (CoC, ROI, etc.) when you finance 100% (including the down payment).
@@awesomebosssoccer7387 I want to do similar. Take cash out refinance but want to purchase the whole property in cash. I am looking for appreciation and cashflow. My only concern is the inflation impact on the cash which will stay in my bank until I find that investment duplex (it could be 6 months to a year). I don't want to buy a property now because too high.
I got really lucky my first deal. Im renting for 3900 and my mortgage is only 2200.
I'm watching this after the hurricane hit, and he says Tampa. I'm like, how could they know?
You talk about gaining equity and taking that to "1031" it. What does that mean?
1031 exchange. Sell one property for a profit and buy a more expensive one and you don't have to pay taxes on profits
While describing why rents can't continue to grow, is also the same reasoning why you can't depend on appreciation, AND why property values will correct doing so by retracing its growth. In other words, we're on a bubble.
Just remember one simple principle in real estate. The land is limited (specially the inhabitable land). The real estate will always increase in value over the years. Look at the land prices in 50s vs today (you do have to offset for inflation)
@@ShowBizJunkie Except that land values do go down, prices do fall and there are bubbles.
What is really driving real estate prices are investors. The demand for investment properties exceeds the underlying consumer demand.
Except for both legal and illegal immigration the population of the US isn't growing as fast as the demand would indicate.
@@BJNeyer prices increase over the years. The national average back in 1999 probably was 200k. The national average now is 300 to 400k. In 1999, 4bd,3ba, 3200 sq in easy bay, ca cost 250k. In Houston the same size house was $120-150k. Now it is unthinkable. When the Market crashed in 2008, the value of the same house went down to 500k after reaching its peak at 800k in 2006.
@@ShowBizJunkie In the long run, EVERYTHING regresses to the mean. I've seen land prices go down and stay down for 20 years. Now if you want to try and get a return off of that time line, go right a head.
Like I stated at the first, in the long run, everything regresses to the mean.
@@BJNeyer ok. What dies this mean? Everything regressing to the mean?
I disagree...... cashflow is a must. If your last property cashflowed you would have been able to put a bigger down-payment and forced cash flow on the next. The negative $200 a month argument sounds exactly like what happened heading into 08.
If real estate isn't going to cash flow then most people aren't going to be able to buy it. Am I supposed to get a second job to help pay for my rental property?
🙏
If you can run the ball effectively even with 10 defenders in the box - then by all means ---- run the fucking ball.
Great video, thank you