Long Distance Land Lording

[Trevor Lohman]

Hi Everyone,

I am fully prepared to take some heat for asking this question, and recognize many of the problems with long distance income property ownership and investing in a "network" but wanted to ask anyway.

I'm 24 and spend probably about 50-60 hours a week working. I'm making what I consider good money (roughly 150 thousand a year pre tax). While I don't necessarily love my job, I don't see myself having the courage to quit and jump into real estate at any major capacity in the next five years. I'm at a time in my life when I'm saving for all kinds of things (wedding, new car, investing) and feel much more comfortable with what is a reasonably steady income (I know no job is guaranteed) I am not a huge fan of leverage, or debt of any kind, which is why I'm putting away money like crazy. I think within this year I would have the money to buy a lower end house in a few other parts of the country that seem to make a lot of sense to me. I do not however see myself having a tremendous amount of time to manage these properties though.

I am wondering if anyone has heard much about or invested in Jason Hartman's platinum properties network. I have listened to his podcast for quite a while, and his investing principles seem to strike me as being inline with bigger pockets philosophy, and my own philosophy. His network does not strike me as guru-ie (is that a word?) but at the same time it is an investment network managed by someone else, which I know many investors would likely call a suckers bet.

Does anyone have any experience with Platinum Properties? Or does anyone want to tell me how crazy I am for considering it lol? At this point it is either get involved in something like this, get some skin in the game, and learn from my experience, or just save my money away for the next five years until I'm at a point where I feel more comfortable ratcheting back from work, and try to become a part time buy and hold investor on my own.

Either way I plan on getting involved in managing my own real estate down the road, but thought this may be a viable way to get started and learn in the mean time.

What do you guys think? Thanks for the help!

Trevor

[Riley F.]

I have done a lot of browsing turnkey property sites, and I have to say that the markup takes a lot of the gristle off of the transactions, not in all cases, but in many.

My advice to you, based on what I am doing and have found useful so far, is to choose 1 market, contact 10 buyers agents, and interview them. You can get some basic interview questions off of this site, and they will go a long way toward picking 1 - 3 to work with (each in different areas). Ask each what markets they specialize in, because each area that you're looking will have areas that very dramatically, even within 5-10 miles of one another. Then call 5 or so property managers and tell them that you are an out of state buyer, pre-approved for a mortgage, are shopping for properties and are going to need a property manager. Ask them what neighborhoods the like to rent in, what home features they like in their rental properties to keep vacancy down, and what you can expect as far as cap rate. After the conversation ask if they mind if you bounce ideas off of them OCCASIONALLY, take their name and email, and followup with a thank you note, handwritten to their office. You should ask the same of the buyers agents.

Once you have a handle on the market, ask the buyers agents to set you up with automated MLS emails with the criteria that you've set based on the above. I would recommend focusing on REOs and HUD homes, but it's your call, you can certainly find deals on the MLS outside of those bounds. Then start to comb these emails, run comps (use Zillow recently sold, Zilpy, Padmapper, Hotpads, and Rentometer) to run sales and rental comps. You'll start to get an idea of what things are priced at in each area. Keep track of the properties that you think are worthwhile in a spreadsheet for a few months while you are getting a handle. You can use the realtors and property managers that you've contacted to verify the properties that pass your prescreen before you actually make offers.

I wish that someone gave me the above before I embarked, because it would have saved me 3 months of trial and error. While I haven't bought a home, I've made many offers, and plan to continue to do so. This should get you started. "Building a team" sound daunting, but it's really just about relationships.

I hope that this helps.