Looking to invest in my first investment property this year.

[JaNae Anderson]

I have two questions that I hope you all can help me with. I'm looking to invest in my first property this year. I have equity in my home and wanted to know should I use the equity as a down payment? I would like to invest out of state (Austin, Dallas or Houston) in order to find the best deal since my area is so expensive. I live the Bay Area (Vallejo, Ca.) Is it a good idea that to invest out of state for my first investment? 

[Alex Craig]

@JaNae Anderson Many people invest out of state, just make sure you like the team as you will have to work with this company for years to come. Make sure the person/team has a solid 5, 10 and 15 yr and beyond plan to be around.  Again, you will be working with these people for years to come.  There is a tendency for out of state investors to fall in love with the #'s and over promises from TK providers and totally overlook the stability of the company. The market is not as relevant as the team.  On BP you hear about all these super markets for investing such as Memphis, Little Rock, Dallas, Houston, various parts of Ohio, etc.  The reality is that you can own a property in Kingston, TN or Northwest Arkansas and do just fine.  People rent everywhere, not just the hot name brand cities. The problem with investing in cities outside of the name brand cities is finding teams that are experienced investors who also own large portfolio's of homes and truly understand your goals and have management aligned with those goals. Which brings me to my final point.  If you are talking to someone who does not have a portfolio of homes, then go elsewhere. I am not talking about individuals who work for people who have large portfolio's of homes, I am talking about the person you are having conversations with actually owns homes themselves, otherwise you are just talking to a salesperson who mind as well be selling you some ovenmits.  Only those who have owned properties can truly understand the challenges landlord face and the sting of vacancy, evictions and excessive maintenance.