Thoughts on investing out of state?

[Brandon Gamblin]

Are there any RE investors interested in investing outside the state of where you currently reside?  If so, which states? And what is it about it that compels or stops you to invest this way?

[Michael Glunk]

@Brandon Gamblin Great question! I've been investing out of state for years. I invest out of state for a few different reason, but my two primary reasons are as follows:

MI - I invest here because I can get better cash flow than where I live. My initial investment goal was to gain as much cash flow as possible so that I could become financially free from my W2 job. I have since achieved this and now just focus on real estate. Why Michigan over other mid west areas? I have a friend in there and that's what I needed to get started there. Now that I am started and have a solid team, why leave? I'm still able to find deals, so I'm still investing in MI. But if/when that ever changes, that would cause me to look in other areas.

MT - I live in CO, but love MT because it is less crowded then CO. I see myself moving there in the future once my kids are through school. So that was the main initial driver. But the market has also proven to be decent for cash flow. Not as good as MI. But I get better appreciation than MI. So it's a good balance.

CO - I live in CO and I'm an agent that works with investors in CO. So because I am here, it makes it easier to invest here. It also makes it easier to take on more time intensive projects. For example about 2 years ago I finish a project where I build two homes in a ski town in Colorado. I was able to be there on site which helped in this process. And I ended up with two free ski homes out of it! One I LTR to provide housing for the mountain community. And the other I STR and do very well. Given I have $0 into the properties, the cash flow, as you can guess, is better than any other project I've done. Because of the market conditions, I was able to achieve this by pulling all of my money out of the project when I converted from a construction loan to a traditional 30 year fixed. I probably wouldn't have taken on this project at a distance. But I did because it's only an hour from my house and I could be there if needed. Now that I have done it, well I would do it from a distance. But I needed to have the experience of first attempting a project like this closer to home to build that confidence. (Come to think of it, I should probably write an article for BP on this as it was a pretty interesting project that could be duplicated.)