What's your experience with remote investment?

Question

What would you say are the pros and cons of remote investing? Also has anyone used a site such as Awning.com to assist in this type of investing?

Taz Zettergren · Answer

@Taylor L. I couldn't agree more. @Kati Attaway congrats on the first post and welcome to BP! The pro's are it saves you time, effort and most likely money as most turnkey providers have systems and processes in place to mitigate the risk for you. I would look for a partner that handles everything in house that way you can hold them accountable if anything were to arise. There are lots of companies nowadays that refer you to others who have flipped the property then refer you to a different property management company. Sometimes messages and experiences don't always come out to be what was presented since there are so many parties involved. A con would be you're giving up the equity on the front end since you'd be paying a provider for a completed product. It depends how you want to spend your time, if you're a busy professional then turnkey wouldn't be a bad option. If you're more of a hands on type person I'm sure you could find an agent, contractor and property management company that could handle the investment for you. I'm sure you'll do fine but the main thing is to take your time and due your own due diligence regardless which route you take. Best of luck investing!

Account Closed · Answer

@Patrick Bavaro thanks Patrick; I have heard of them and trying to decide between apartments.com, RentRedi, or Tenant Cloud. I was trying to find a maintenance mgmt tool feature. Working on my first property and want to be ready!

Drew Sygit · Answer

We think the Midwest is a GREAT place for OOS investors to consider! YES, we may be a little biased, but check out our blog here on BP comparing Detroit to other cities and Deep Dives on Metro Detroit cities & neighborhoods: https://www.biggerpockets.com/... Your biggest question shouldn't be WHERE to invest, but HOW you will invest! Many OOS investors set themselves up for failure because they don't truly take the time to understand: 1) The Class of the NEIGHBORHOOD they are buying in - which is relative to the overall area. 2) The Class of the PROPERTY they are buying - which is relative to the overall area. 3) The Class of the TENANT POOL the Neighborhood & Property will attract - which is relative to the overall area. 4) The Class of the CONTRACTORS that will work on their Property, given the Neighborhood location - which is relative to the overall area. 5) The Class of the PROPERTY MANAGEMENT COMPANIES (PMC) that will manage their Property, given the Neighborhood location and the Tenants it will attract - which is relative to the overall area. 6) That OOS property Class rankings are usually vastly different than the local market they live in. 7) That a Class X NEIGHBORHOOD will have mostly Class X PROPERTIES, which will only attract Class X TENANTS, CONTRACTORS AND PMCs and deliver Class X RESULTS. 8) Class A is relatively easy to manage, can even be DIY remote managed from another state. 9) Class B usually also okay, but needs more attention from owner and/or PMC 10) Class C can be relatively successful with a great PMC (do NOT hire the cheapest!), but very difficult to DIY remote manage. 11) Class D pretty much requires an OWNER to be on location and at the property 3-4 times/week. Most quality PMCs will not manage these properties as they understand most owners won’t pay them enough for the time required and even then it’s too difficult successfully manage them. ***Only exception is if an owner has plan & funds to reposition Class D to Class C or higher. https://www.biggerpockets.com/forums/776/topics/960183-what-they-dont-tell-you-about-cheap-rental-properties?highlight_post=5562799&page=3#p5562799 Also, SERIOUSLY consider do you really have the time to be a DIY landlord or should you hire a PMC? Good luck with whatever you decide😊

Patrick Bavaro · Answer

@Sterlena T. ’ve used a few, but the one I’ve stuck with now is RentRedi. Easy to manage tenants and payment, lease signing etc. And they have an integration with a property maintenance company called latchel that will source the bids and hire based on the thresholds you set. It’s pretty cost effective too and I think BP has a good discount for It.

Account Closed · Answer

@Patrick Bavaro. curious what maintenance software you are using?

Patrick Bavaro · Answer

@Kati Attaway ton of benefit. 2/3rds of my rentals are out of market purchases. To me, it’s almost the same as if I bought It down the street. I was honest with myself and told myself that at the end of the day, I didn’t want to do the repairs directly and manage the tenants, so I just used a property management software that has an integration with maintenance platforms and it’s been great. Currently, I’m in the process of building a new build 4/3 out in Cape Coral FL while I live about 3 hours away. Total all in cost was right about $265k, only required 10% down, rents right now at about $2300, and post construction appraisals are around $340k-$410k depending on the location. It’s a win win win all around for me. Let me know if you’d like to connect. Just message me. Good luck!

Taylor L. · Answer

There are folks out there having success working with established turnkey operators to find out of state deals. I'm not familiar with Awning until just now. After taking a look, it appears similar to many other sites that suggest they can make remote real estate investing easy. In reality, you still must do your own due diligence on the properties, property managers, markets, and so forth. These types of sites can't get you past needing to do your dd.