Starting out as out of state investor trying to find a good deal

[Mayuresh Kshirsagar]

Hi,

I am a newbie starting out as an out of state investor. Have started out in Austin getting 2 duplexes. But ended up being a lot of negative cashflow on both.

I got started! But now trying am struggling to find a good deal.

Primarily thinking of Cleveland, Austin and Peoria.

Any recommendations if this looks like a good place to start?

[Kerlous Tadres]

Quote from @Mayuresh Kshirsagar:

Hi,

I am a newbie starting out as an out of state investor. Have started out in Austin getting 2 duplexes. But ended up being a lot of negative cashflow on both.

I got started! But now trying am struggling to find a good deal.

Primarily thinking of Cleveland, Austin and Peoria.

Any recommendations if this looks like a good place to start?

Hey Mayuresh, I really like Cleveland, Ohio for cash-flow. I worked out there for a couple months and know the area decently well. Let me know how I can help you out

[Ko Kashiwagi]

Hi Mayuresh,

What are you priorities (cash flow, appreciation, competition, etc)? Cleveland is a very popular place for cash flow and some cities in Austin has done well in appreciation

[Mayuresh Kshirsagar]

I’m looking to buy and hold with mainly appreciation in mind. But would also prefer a not so negative cash flow.

[Jimmy Lieu]

Quote from @Mayuresh Kshirsagar:

Hi,

I am a newbie starting out as an out of state investor. Have started out in Austin getting 2 duplexes. But ended up being a lot of negative cashflow on both.

I got started! But now trying am struggling to find a good deal.

Primarily thinking of Cleveland, Austin and Peoria.

Any recommendations if this looks like a good place to start?

Hi Mayuresh, personally not a huge fan of the Cleveland market because it's losing population year to year and companies aren't moving there. If you're looking into your next market, I would recommend Columbus Ohio. You can find positive cash flowing properties here that hit the 1% rule and there's tons of huge appreciation potential. A lot of my out of state real estate clients really like this market because the macroeconomics look so good for this market - population is growing, job growth is growing, and so many companies moving and developing here. Lastly, price point is still super cheap - you can find deals for under $200k! Happy to connect and answer any questions you may have.

[Samuel Diouf]

Hey Mayuresh, Cleveland is a great market to invest in if you're looking for cash-flow. Because of that low barrier to entry, plenty of investors from all over are looking at this city. I highly suggest working with an investor friendly agent so you don't buy in the wrong location.

[Regina Blake]

Hi, my clients as well as myself would definitely agree that Ohio is a great state to invest in real estate. It is a hot spot for real estate come check it out and reach out if you have questions. Good luck!

[Simon Ashbaugh]

Quote from @Mayuresh Kshirsagar:

Hi,

I am a newbie starting out as an out of state investor. Have started out in Austin getting 2 duplexes. But ended up being a lot of negative cashflow on both.

I got started! But now trying am struggling to find a good deal.

Primarily thinking of Cleveland, Austin and Peoria.

Any recommendations if this looks like a good place to start?

Hey Mayuresh, Cleveland is definitely a great spot for targeting cash flow. Check out areas like Lakewood, Old Brooklyn, Brooklyn Centre, Edgewater, Jefferson and West Boulevard. These are some places that are good to explore.

[Patrick Drury]

@Mayuresh Kshirsagar   
I would recommend being in areas on the West Side of Cleveland like West Blvd, Cudell, Old Brooklyn, Clark Fulton, Edgewater, Jefferson, and Brooklyn Centre. The reason is the rent-to-price ratio is good so you can cash flow, and most of the West side doesn’t have a Point of sale inspection which is really annoying 

[Jacob Kocent]

@Mayuresh Kshirsagar

Hi Mayuresh,

I have heard areas like Cleveland and Columbus are great areas to start out as an out of state investor. I would definitely exhaust options there and check every avenue for good deals. In addition, Pittsburgh, PA is a similar market and has a very low barrier of entry.

I work here in Pittsburgh as an agent working directly with investors every day. We often work with out of state, and even out of country investors. I recommend adding it to your list as a possible location to invest in. If you like what you see, I'd be happy to connect further and try to find investment properties for you!

[David Leggett]

I'm seeing a lot more properties in Cleveland coming on the market lately that are looking good for cash flow! It just really depends on whether you're looking to invest in single or multifamily properties, how much you're looking to spend, and what type of neighborhoods you feel comfortable investing in. 

Obviously the C and D neighborhoods will offer higher cash flow at a lower price point, but there's also some good opportunities in A- to B neighborhoods depending on what your strategy is.  

But like Patrick points out, each city has their own processes and some have point of sale violations, and Cleveland is supposed to start doing this in the fall, so the best thing you can do is to find an experienced agent / broker who can help navigate these issues with precision and ease!

[Joseph Bui]

Hi, I think the midwest is a great place to start. I'm based in Seatle but have 9 doors across Memphis and Detroit. I've also looked extensively into Cleveland. Happy to connect and knowledge share if you are interested.

[Drew Sygit]

@Mayuresh Kshirsagar Detroit is one of the best markets in the Midwest right now!

Just Google Detroit and read what's going on here:)

[Nathan Gesner]

I recommend spending some time educating yourself on how to analyze properties to prevent you from making the same mistake again. Read "Long-Distance Real Estate Investing" by David Greene and watch videos from Dave Meyer to learn about the hottest markets in 2024.

[Sarita Scherpereel]

Out of state investing is not for everyone. More people on BP post about successes than the lessons they learned. Sometimes it's better to start in your own back yard to mitigate rookie mistakes. If you do invest out of state make sure you have a solid team lined up that gives brutally honest feedback on the numbers from day one- BUT ALSO THE EXIT STRATEGY. Often people fail to inquire deeply about because no one can see into the future. If you have to sell quickly or hold for 10 years what do those locations do for you in the property you pick? Very important to ask your team about that. 

[Min Zhang]

Hi Maryuresh, welcome to Bigger Pockets! While I can't speak to investing in Austin and Peoria due to my lack of experience in those areas, I can definitely vouch for Cleveland as a fantastic option, especially if you're seeking cash flow properties. I suggest thoroughly exploring the neighborhoods in Cleveland, with a particular focus on the west side. There, you can typically expect cash flow ranging from 10-18%. Don't hesitate to ask if you need anything!

[Joshua Janus]

Quote from @Mayuresh Kshirsagar:

Hi,

I am a newbie starting out as an out of state investor. Have started out in Austin getting 2 duplexes. But ended up being a lot of negative cashflow on both.

I got started! But now trying am struggling to find a good deal.

Primarily thinking of Cleveland, Austin and Peoria.

Any recommendations if this looks like a good place to start?

 Cleveland has a lot of duplexes available in rental heavy areas that cash flow with purchase prices under 200,000. You can stack those up and pay the debt down 

[Caleb Brown]

I recommend Kansas City too :)

[Najma Osman]

Hi @Mayuresh Kshirsagar, 

Welcome to the world of real estate investing! It's good to hear that you've jumped in with your two duplexes in Austin, even though they haven't worked out as planned. Starting out is the hardest part for most. 
While Cleveland, Austin, and Peoria are all good markets, I'd recommend considering Columbus, Ohio, as well. Cleveland is a better market for cashflow but Columbus offers a stable and growing market with a strong rental demand, and diverse economy. I'd be happy to help you explore opportunities here and provide more detailed insights. Feel free to reach out!