New Investors advice: Dallas/ Rochester/ Houston ?

[Ethan Li]

Hello BP community! I'm a new investor based in the San Francisco Bay Area. I'm planning to buy and hold 2-3 out-of-state properties next year for long term investment and would appreciate some professional advice. Currently, I'm considering Dallas, Houston, Rochester, and Sacramento.

1. Dallas and Sacramento might offer better appreciation potential, but there's a risk of negative cash flow. I need to thoroughly evaluate deals, especially with property management and current interest rates.

2. Rochester shows strong cash flow, especially for multi-family properties, but I'm concerned about rehab costs and minimal appreciation, questioning if it's a suitable starting point for a beginner.

3. Houston falls in between, offering relatively easier access to cash flow deals compared to Dallas and some appreciation potential. But I personally believe Dallas may show better economic growth these years 

Which area do you think is more beginner-friendly for remote investing? Any other areas you recommend? Thanks for all your help and happy holidays!

[Andrew Postell]

@Ethan Li this is a very common topic of discussion - which city/town is better for me to invest in.  And it's ALWAYS the same answer...which city/town do you have people that you trust?

I'm saying this as a 15 year, out-of-state investor - my recommendation is to ALWAYS choose whatever city you have the most trustworthy contacts in. Keep in mind that you may never see your asset. That's an ENOURMOUS amount of trust/money to put into a stranger's hands. What I mean here is that if you know someone in a different city...but that city may not have as good as numbers as this other city...then stick with the city where you know people. One wrong move, one wrong contractor, one wrong vendor will erase any "benefit" one city has over another. Your network is the most important piece for any potential returns when you invest out of state.

So, which area do you have good people in that you trust?