How to get started investing out of state

[Jeremy Schreiber]

Hey everyone,

I live in Silicon Valley, which means I really need to look at investing out of my home state.  My dad lives in Phoenix, which is a growing market, and it seems like it could be a good place to start.  That said, I have a full-time job here in CA which means I can't relocate there for a month or two to dig deep into the market.

So how do I get started investing remotely? (BTW, it doesn't have to be Phoenix)

Thanks!

[Account Closed]

Originally posted by @Joel Gabelman:

@Jeremy Schreiber

I asked the realtor: "Who would buy this house for $400k?!?!"  He looked at me and smiled: "An out of town investor who thinks this is cheap!"

LOL!  So the old saying "Out-of-state investing is where California investors go to lose money" was not a myth.  There's also another saying "Live where your wife wants to live. Invest where the numbers make sense."  Of course, there's also a saying "A sucker is born every minute."  I wonder who came up with these slogans.  However, I understand money has to keep circulating.  Otherwise, the economy would enter deflation, which is something the Fed has been fight hard to keep us out of since 2008.

As master Oogway said "One often meets his destiny on the road he takes to avoid it."  I have confirmed this with several veteran investors, and the saying has been spot on.  Of course, there's no scientific data to back it up, but data without context is just garbage in garbage out.

For every $100k-$200k property, one has to invest ~$30k to $55k down payment plus closing costs.  How fast can one save this money?  Can one scale it fast enough to provide a desired residual income to retire?  What does it take to speed up the process?  

Being able to buy at a discount 70%-80% FMV can definitely speed up the process and get one to his desired finish line sooner. How can one do that from afar? Know one's end goal and work it backward. Don't buy rentals for the heck of buying because it seems like everyone is making money doing it. In fact, when everyone wants to become a real estate investor, one should be fearful. Does one want to own real estate for yield or for wealth? If for yield, wouldn't it better to invest in crowdfunding or private lending? No tenant, no toilet to worry about? If for wealth, hasn't the Bay Area been proven to be one of the most profitable markets in America? Would it be easier to buy at a discount in one's local market than afar? Just something to think about before jumping in either feet or head first.

Best of luck.