Looking across America from California

[Garett Collins]

This is my first post on BP so please forgive any newbie questions, comments, and etc.

My wife I unknowingly did a house hacking BRRRR on a duplex in Southern Maine when I lived there at the time. I found it on Zillow of all places for $25,000 which needed $100,000 of work. It was in terrible shape. Funny story on that actually the first day we showed to start demo'ing the place a county official showed up to put caution tape on the house to make sure no one entered the building since it was at risk of falling a part. We definitely learned a lot. We initially thought it would be about $50,000 to rehab and we spent double. Thankfully today it is worth about $180-190K and it started cash flowing pretty quickly. Currently, in the non winter months (we pay for heating), we receive about $1,000 month and during the winter months about $300-500. It is a 3/1 ($1350/mo) and 2/1 ($1050/mo) duplex where we lived rent free for two years!

Now we are about 4 years down the road in California and we have really wanted to obtain more rentals. I would like to use the BRRRR long distance method but aren't really sure where to start. We are yearning to move out of Cali and into a more business friendly state in the next two years so I have been thinking about states that we are considering which are 1) Florida, 2) Texas, 3) Tennessee, and 4) South Carolina. We have saved up about $10K cash for rentals and also I am considering either using a HELOC or just doing a simple REFI on our Maine apartment and am hoping to get at least another 30K from that.

So with around 40K to get started, again, with we really want to start moving forward in this journey. I have a goal of getting at least 2 more rentals by the time 2019 is over and then double down on it next year before we leave for our new home. 

We are basically starting from scratch with a cash flowing apartment to our name and decent paying jobs, although cost of living here is pretty high. 

My biggest question would be how do I find good properties to BRRRR especially at long distance? I would think off market properties would be the best but that sounds really challenging although I am up to the challenge if I can learn it.

Let me know! THANKS!

[Katherine Hite]

Hi there Garett! 

Welcome to BP and this crazy world of investing!

Thank you so much for sharing your story, I love hearing how other investors got there start! I began my career in real estate a year ago by getting my license and acquiring my first house hack! It has been a whirlwind since then and I love having the opportunity to share what I've learned through my experiences. 

You are a smart to consider Tennessee (particularly Middle i.e. Nashville). It's market is extremely active and will remain so for a little while longer; the solidity is grounded in geographic location, climate, diverse employment base (ever expanding), higher education, no state sales tax, hospitality/tourism, music and entertainment, the list goes on and on. 

I remember a BP episode from last year I believe about long distance investing and how important it is to establish your 'core 4' (think boots on the ground i.e. Realtor, Lender, PM, Contractor) in whatever city you've chosen to buy in. I'm pretty sure it was the David Greene episode because he has a book called 'Introducing: Long Distance Real Estate Investing'. So to answer your question about how you find good properties, I would say you start by finding the good people, who you trust to be your boots on the ground. 

If you're in need of a mortgager or just want a second opinion to get a better rate from your guy I highly suggest talking with Kyle Deutschmann. Working for one of the top-rated lenders on Lending Tree, he is also an avid BP listener so he is able to comprehensively understand your wants and needs during the process. 

If you're in the area, let's grab coffee! If not I'd love to answer any questions you may have as well as get to know more about what you're goals are! Funnily enough, I also want 2 more rentals by the end of the year! Let's make it happen!