Starting Out While Living in a High Cost Area

[Gina Kim]

Hi BP! I'm Gina, 30 years old, and live in San Diego, CA. My husband and I recently inherited a family home which we renovated and rented out, and are now looking to go deeper into real estate investing (mostly buy and holds). I work in the mortgage industry and my husband is an engineer and we are blessed to both have jobs that already allow us a comfortable lifestyle and high savings rate. 

Currently looking to get into investing out of state (still looking to narrow down on a specific area - any suggestions and inputs are always appreciated) due to the high barriers to entry in Southern California. I wanted to see if anyone else could share their experiences with investing out of state and what steps they took to successfully land their first few deals? Due to the current economy, we'll probably be waiting until late summer/early fall to start writing offers, but in the meantime I'd like to spend my time networking, researching target areas, and analyzing deals for practice.

I understand that several investors will recommend buying locally first before expanding out of state, but I am of the mindset that (1) I do not wish to sink so much money into my first purchase, (2) I may be less risk averse than some other newbies, and (3) while no one wants to have a bad experience or investment, I'm willing to look at it as a learning experience instead of a total loss. We spent the last few years cohabiting with other people to save money so we are not interested in house hacking - that being said, if the numbers really makes sense to do this, then we would be open to looking into this again. We were initially considering ADU builds if we wanted to invest locally so that is an option that we may consider if we decide to go the local route.

I only just started connecting with more investors and researching more into this, so I'm welcome to any suggestions! Thanks for reading, and look forward to connecting with more of you :)

Best Regards,

Gina

[Twana Rasoul]

@Gina Kim

Hi Gina,

I invest locally and have investments OOS. Even though you see this comment coming from far away, here it goes anyway...invest in a house hack here in San Diego. If you are risk averse, you are better off starting here than going out of state initially.

House hacking doesn’t mean that you are necessarily sharing a house with other roommates. I myself still house hack and I plan on doing so forever. I live in one unit and have tenants in completely separate unit. You would not have even guessed that I owned both units next to one another when you see it.

Feel free to reach out if you’d like regarding locally investing, if you decide to go OOS, I’d be happy to give some pointers and some of the few dozen mistakes I initially made.

Best of luck either way!