Advice while looking for my first property

[John Kim]

Hi everyone,

I started my search for my first property (out of market) and could use any/all advice for two questions. And sorry for any very obvious questions; this is the first piece of property I will be purchasing.

1. Order of tasks

I have some market research and have started looking through properties for deals. Should I be securing a loan with my bank first? Does that come after I find a good deal and negotiate a price with the owner? I have very good credit, good income, and just enough capital to fund my first down payment. I'm coming into this with little to no experience in real estate, so I'm completely lost on what I need to be doing first.

2. Building a team

Since I am looking to purchase my first property in another market, who are the essential people I should be looking for my team? I have an accountant that I work with locally, but do I need another one from the market I'm looking in? 

I am under the impression I absolutely should find a real estate agent and a property management company to work with in the market. Is there anybody I'm missing?

Thank you all for your help!

[Fred Heller]

@John Kim   If you're going to finance, the absolute first thing you need to do is arrange the financing and get a pre-approval letter. I can't speak for other markets, but around here, the seller won't even consider your offer if a pre-approval letter is not attached.

As far as building a team, you'll need a Realtor and a Property Manager. Since all property managers are also real estate agents, I would recommend that you use one person for both services. In my opinion a property manager/Realtor is going to have a much better understanding of your needs as an investor, and will be a better judge of a property's potential as a rental. And you're going to need a property manager for an out-of-state investment anyway. You might as well let the person whose going to manage the property find it for you and let him/her make the commission on the deal.

Your property manager will also act as your accountant and provide the financial reports you need.

The key to that is finding someone you trust. I work with several out-of-state investors and I WILL NOT let them buy a property that I wouldn't buy as an investment property for myself. That has cost me a lot of money. But I sleep nights.