Out of State versus California (Home)

[Cody Evans]

Hi all,

I have been in a hard spot for a while now trying to determine if investing out of state in cash flowing rentals is too risky versus saving up for a home nearby me in pricey California. Some background info: I am 22 years old, bachelors in math and 50k/year job teaching. I plan to have 20k saved in 2 years and want to be able to hit the ground running by that time. My initial thoughts on out of state were that it was a great opportunity to be able to get started in real estate but I keep getting many mixed messages on how risky it is versus managing it here in Cali myself. My thoughts are what am I going to do anyway if the property is right next door to me? I don't see how management will be impacted just by distance. Also if I buy in other parts of the country I can get started earlier, fail faster and then know what I am doing by the time I would have saved up money just for once house in Cali! I already have a residence with my wife so that is a great position to start in as I don't have to pay as much for my own living expenses. 

Can the BP community weigh in on this and give some advice on the pros and cons so I can weigh this out myself?

Responses will be appreciated, especially if they are from Cali(real estate joke)

[John Miller]

have you folks looked into investing in non-performing notes? trading paper is a very lucrative investment. we JV on notes, and our investors are realizing double digit returns. for those who are interest in passive investments JV'ing on notes or CFD's is an excellent move.