Long distance investing

[Apar Bains]

Ok guys, Total newbie here! I am researching and planning at this point. And This may have been asked and answered before. I live in Northern California, Greater Sacramento area. House prices are high, seems like it is difficult (not impossible) to find positive cash flow deals. So I am considering investing in out of state markets. However, I have no idea how to go about finding connections and building a reliable team that can help manage these properties. I would appreciate, any help regarding where to start. Thanks in advance :)

[Subbie Kaur]

@Apar Bains

Hey Apar! 

Out of state investing is great as long as you find a market that has the  following main things mentioned below. I just wanted to give you breakdown of what we look for in any market before investing in it: 

1. RENT TO VALUE RATIO. This is the biggest determinant of cash flow. Make this your benchmark when you search for new markets if your goal is to be a cash-flow investor. 

2. Go for low property taxes and landlord friendly laws. Investor-friendliness and having a positive, low stress OOS experience go hand-in-hand. 

3. A property manager who can educate you on a market, help you form a strategy, fit right into your due diligence process, and execute on a clear takeover game plan as soon as you hold title. Research and contact several property managers in the area, ask any questions you have, if they are willing to help you with that then you are going one step in the right direction. 

4. Rental Demand: This keeps vacancy and turnover down (resulting in lower maintenance too), and tenants tend to behave because they know your place is a hot commodity. 

Do you have any markets that you are looking into already?

P.S:  We currently invest in the Northwest Indiana( NWI) market, great cash flow, low purchase prices, landlord friendly laws:). 

Good luck to you in your investment journey