Investing in Rental Income Properties out of state

[Shashank R.]

Hey Everyone,

My goal is to invest in Single Family Homes and Condos that I can rent out and eventually generate a decent amount of passive income.

I’ve heard from many experienced investors (and moguls) that the best way to start out is start in your city, town or state because you will have a much better idea about neighborhoods, job market etc and would just need to drive around to get some leads.But I don’t have that luxury because I live in the San Francisco Bay Area where housing is a lot more expensive than what I can afford.

I’m looking at purchasing properties worth $50-$100K where the mortgage would be affordable for me to cover out of pocket in the event I’m not able to have the place rented. From the very basic research I’ve done, I’ve figured out that good deals can be had in the following states (in my price range): Florida, Georgia, Texas, Ohio, Colorado and Utah. I have the following concerns

1. I plan on using a Property management company (8%) but I’m concerned I’ll get ripped off I don’t take precautions or look for certain things (because I don’t know what I need to look for)
2. Random Unexpected events come up: IE roof caving in, Water heater breaking etc that will render the unit unlivable or exposes me to liabilities.
3. Since Im not in the area, i don’t know it that well, ill end up choosing something that is not in the ideal location, and my assumptions about the place being rented, etc will be completely wrong.

I would appreciate any suggestions or nudge in the right direction.

Thanks!