Advice For New Long Distance Investors

[Slocomb Reed]

BP Community and Newbie Investors! A piece of advice to those of you who live in expensive parts of the country/world and have your eyes on the midwest and southeast United States to get into cashflow investing...

As an active BPer, BRRRR investor, and an agent who works with investors in Cincinnati, I get a boatload of messages from BP members who are looking in markets like mine for great deals (at least 20% below market, great cashflow, not a lot of rehab, etc.). On behalf of many of us on BP who spend a lot of time and money hunting for these deals in our local markets: When we find them, we're buying them ourselves! (But please keep reading!)

We're at a time in the market cycle when every market is saturated with people looking for these deals and every market now has several investors who are out there hustling to be the early bird. Local experts who have done a few or more than a few deals and are looking to build their portfolio. Value add deals are complicated; there are a lot of moving parts and each one has the potential to turn a deal south and lose you money. With deals being so scarce we all have to find or create for ourselves a competitive advantage. If you're new to real estate and you want or need to invest in markets where you don't already have a strong network, then how are you going to be the one who gets the great deals?

I think I have an answer: it's time to shift your mindset. Instead of looking for great deals in great rental markets, look for great partners in those markets. People who are finding the deals you're looking for and would be able to take down more of them with your help. This comes with its own risks of course, but those can be mitigated with due diligence and getting part of a great deal is better than getting no deal!

More on identifying quality partners and structuring partnerships in future posts, for now please chime in and add to this discussion! Thank you!