Out-of-State LTR Investing

[Daniel Windingstad]

Hello,

I own 2 properties (1 sf, 1 duplex) in Minnesota, and find that the rules, fees, tenant laws, taxes, etc. In Minneapolis are making it very hard to be profitable. The best thing i seem to have going is appreciation, which is nice, but cashflow is struggling a bit. 

What are the best out of state markets, and who has invested out of state? What are the major pros and cons, and tips to making it successful out of state? Open to all shared knowledge. 

cheers, 

Dan

[Dean Harris]

@Daniel Windingstad

This is alwasy a popular question and everyone will likely suggest the location they are investing in. I invest in Memphis, TN and have a large portfolio of SF properties here. Im sourcing a strong tenant base with the properties I am buying and my average rent is just under $1700. You will be able to find cash flow and some appreciation here in Memphis. I often see the 1% rule all they way yo to the $140,000-$150,000 price range. 

Best of luck!

[Bob Stevens]

Quote from @Dean Harris:

@Daniel Windingstad

This is alwasy a popular question and everyone will likely suggest the location they are investing in. I invest in Memphis, TN and have a large portfolio of SF properties here. Im sourcing a strong tenant base with the properties I am buying and my average rent is just under $1700. You will be able to find cash flow and some appreciation here in Memphis. I often see the 1% rule all they way yo to the $140,000-$150,000 price range. 

Best of luck!

 So are you saying ALL IN 170k with rent of $1700? All in 150k rent of $1500 ? 

[Dean Harris]

I dont see them much in that 1700 range. I do see the 1% rule in 80,000-150,000 range in Memphis

[Bob Stevens]

Quote from @Dean Harris:

I dont see them much in that 1700 range. I do see the 1% rule in 80,000-150,000 range in Memphis

 Ok so 125k all in rent 1200? WOW I really am spoiled. I get 2% rule. All in 75k rent 1700, all in 90k, rent 2k, 

All the best to you 

[Dean Harris]

Quote from @Bob Stevens:

Quote from @Dean Harris:

I dont see them much in that 1700 range. I do see the 1% rule in 80,000-150,000 range in Memphis

 Ok so 125k all in rent 1200? WOW I really am spoiled. I get 2% rule. All in 75k rent 1700, all in 90k, rent 2k, 

All the best to you 

 Single Fam? Section 8? There has to be some challenge or the entire country would be in your back yard! :)

[Bob Stevens]

Quote from @Dean Harris:

Quote from @Bob Stevens:

Quote from @Dean Harris:

I dont see them much in that 1700 range. I do see the 1% rule in 80,000-150,000 range in Memphis

 Ok so 125k all in rent 1200? WOW I really am spoiled. I get 2% rule. All in 75k rent 1700, all in 90k, rent 2k, 

All the best to you 

 Single Fam? Section 8? There has to be some challenge or the entire country would be in your back yard! :)

 Actually no, and the entire word is and has been " in my backyard"  for many years. I know dozens of investors from Israel, Spain, Belgium and all over America, that have purchased 100s and 100s there We used to get 3% rule however prices have tripled and much much more over the last 10 years, 

[John Williams]

Start with an established team member in your desired out-of-state market. A great broker, property manager, lender, flipper, etc. can open many doors for you and allow you to leverage their networks. You don't have to reinvent the wheel - just align yourself with a great group of folks who are doing what you want to do in that market!

[Bob Stevens]

Quote from @Dean Harris:

Quote from @Bob Stevens:

Quote from @Dean Harris:

I dont see them much in that 1700 range. I do see the 1% rule in 80,000-150,000 range in Memphis

 Ok so 125k all in rent 1200? WOW I really am spoiled. I get 2% rule. All in 75k rent 1700, all in 90k, rent 2k, 

All the best to you 

 Single Fam? Section 8? There has to be some challenge or the entire country would be in your back yard! :)

 No Challege, I have a team that takes care of it all for me, of course I oversee and consult. I have been and am still doing, lets just say a lot of business in my market. Best part I'm on the beach in FL,,,,,,  

All the best to you 

[James Wachob]

Hello, 

Have you considered looking into Memphis, TN? It could be a fantastic market for what you're trying to achieve. Memphis offers a relatively low cost of entry compared to many other markets, which can help with cash flow right from the start. The city has a diverse and growing economy, with a solid rental market that's often appealing to investors. Additionally, the landlord-tenant laws there are generally more favorable compared to what you might be experiencing in Minneapolis.

Of course, investing out of state comes with its own set of challenges, like managing properties from afar and understanding local market nuances. However, with the right property management team and a bit of research, Memphis could offer the cash flow and profitability you’re looking for.

If you decide to explore this option, I’d be happy to share more insights or connect you with resources that could help you get started

[Bob Stevens]

Quote from @James Wachob:

Hello, 

Have you considered looking into Memphis, TN? It could be a fantastic market for what you're trying to achieve. Memphis offers a relatively low cost of entry compared to many other markets, which can help with cash flow right from the start. The city has a diverse and growing economy, with a solid rental market that's often appealing to investors. Additionally, the landlord-tenant laws there are generally more favorable compared to what you might be experiencing in Minneapolis.

Of course, investing out of state comes with its own set of challenges, like managing properties from afar and understanding local market nuances. However, with the right property management team and a bit of research, Memphis could offer the cash flow and profitability you’re looking for.

If you decide to explore this option, I’d be happy to share more insights or connect you with resources that could help you get started

 My partner did a lot of biz there about 7 8 years ago then left to join me. Have the numbers improved? Please provide an example of your last deal, all in and rent. If attractive I'm open 

Thanks