Pick a location based on PM?

[Brandon Hopkins]

I own a couple of properties in California and am ready to invest out of state. I've looked into a few different cities that would satisfy what I am looking for. My problems/questions:

1. How do I honestly get a read on the areas? Are they crime riddled? I am happy to pay extra to be in a good area with steady rents.

2. How do I find a good PM? I found what looks to be a good company in Memphis (Enterprise Property Management) but they charge a lot of fees (9%, $250 escrow, $595 leasing fee, $99 advertising, $250 lease renewal). My current PM charges a flat $70/month.

3. Who can take pictures and give me an assessment of the home including pictures? Should I look for a good RE agent or pay the PM an hourly fee?

Everything else is ready to go, just need to find the property and PM.

Thanks!

[David Hutson]

Afternoon Brandon,

I'm in Sacramento and in the same boat as you.  I started investing in Memphis almost a year ago because I have family ties there.  You need to narrow down your areas of interest and requirements/desires for the homes you want to purchase. 

Most of the answers to your questions can be answered on here by people who are in the area you want to invest in after you narrow it down.  I would definitely use the BP people and resources as an initial step.  As for your questions:

1.  I went out to Memphis before my first purchase and met with several agents and turnkey companies and used their info to determine what areas are good or bad in regards to crime.  Many cities have crime statistics on a website.  You can Google specific cities.  Ask in here. 

2.  PM's, again, ask in here.  There are many people in your areas of interest who can chime in specifically and tell you who is good and who they have had issues with.  You can also read reviews for PM's on sites like yelp or by doing searches for their names.  Check as many sites and references as possible.  Not everyone will have a good experience with every PM so I go for who has the most good and the least bad, make a small list and then contact those personally.  The fees, like you listed below vary by PM, and I would say more so by the area.  Like you, I don't pay a lot of extra fees in CA but Memphis is riddled with them.  I had never seen the lease renewal and advertising fees like there.  My partner just got rid of one PM there who charges an advertising fee and never specifically advertised a property he owns.  They stated the fee changes monthly and goes towards all properties that are available.  Watch out for things like that.  He paid about $100 per month for a few months before they even listed his house on their website. 

3. This will also depend on where you want to purchase. If you are purchasing the home off MLS and intend to use an agent then use that person to take all the pictures and get info for you. If you are doing it through a private sale then you definitely need to have a 3rd party do some research and provide you info. A PM may do it for a small fee if they know they will be mananging the property for you.

I strongly suggest going out to wherever you intent to purchase personally though, at least prior to the first purchase.  You can have an agent show you around while looking for houses to purchase, learn where the good and bad areas are and make sure what you see in the pictures meets your standards.  The photographs online or sent to you won't tell the complete story.  After comparing what I saw online and while doing research in Memphis for a month prior to going out there, and then seeing the actual home quality when I was touring, I would almost never purchase a house without at least visiting the area once and knowing a lot about who is selling me the home.  The quality did not match what I saw in most of the online pictures from all of the companies  I visited when I flew out there.