Long distance landlording?

Question

I'm new, looking for my first property.  Where I live is very high priced and I am having a hard time finding good deals.  However, I see places, across the country from me (specifically looking in the Gwinnet County, Georgia area currently, because my grandparents live there) that seem like great buys!

Is long distance landlording a good idea?  For a new investor?

Any tips for doing the long-distance thing?

It looks like an incredible opportunity, while my local options are frustrating (Salt Lake and Utah counties).

Any tips and thoughts are much appreciated!

James Wise · Answer

Long distance works. Few things you should do.

• Make sure you hire a professionally licensed property manager. DO NOT try to do this alone or with an unlicensed property manager.
• Get a 3rd party inspection prior to buying the investment property. The inspector is your eyes & ears out there. USE THEM! It's only a few hundred dollars. Well worth it.
• Get an appraisal. If you purchase the property with financing (You should, OPM is the best part about real estate investing) the bank will make you do this. This is another safe guard to know your not overpaying.
• Understand this is a get rich slow game. You won't be drowning in cash flow after buying a few properties so don't start dreaming about quitting that day job just yet!
• Don't buy the lowest quality asset. Pick a B-Class or higher neighborhood to start with. If after you get your feet wet you are up to it you can move on to higher risk / higher reward properties.

Sergiu Ionita · Answer

Hi @Nicolette Alger, I'm a fairly new agent living in Gwinnett county (Dacula) I want to specialize in working with investors. Let's connect! Send me your criteria and I can send deals your way. I often get early access to off-market properties as well. I look forward to hearing from you.

Nathan Gesner · Answer

I agree with some of those above. There are professionals out there (@James Wise or @Tom Ott) that can help you get started with a decent, cash-flowing home under their management.

You take a risk working with someone you don't know. However, they're both established in this forum and wouldn't be popular if they were screwing over investors.

Do some research on what a good property manager looks like. Investigate their markets. Interview them and a couple others and make an educated decision.

Account Closed · Answer

The ideal long distance landlording, in my experience, is with commercial real estate.  Tenant has the most incentive to secure and protect your investment, not to mention long(er) term leases.

Eliseo Magallon · Answer

@Nicolette Alger

If you do decide to buy a property in Gwinnett County (I live in Lawrenceville, GA). Let me know! I'd love to manage the property for you if you don't mind me learning the ropes. haha I have no problem talking with tenants and contacting the necessary people to do maintenance on the property or reporting back to you on how things are going. Just offering my services to learn more in real estate!

Thomas S. · Answer

Investing long distance is very doable. Land lording, in my opinion, is not. Many will do it successfully until the day comes that they run into a bad tenant at which point it will all fall apart.

Managing a PM is not easy but is possible when you find the right one assuming you have the knowledge to manage a PM.

Long distance investing is obviously higher risk.

Nate Burgher · Answer

I highly recommend reading David Greene's new (relatively) book. It's a somewhat dry read, but it's an A-Z manual describing the system he uses to invest long distance in any market. I'm in the same boat as you, my local market is just too darn expensive so I've been studying other markets for months. One of the biggest takeaways from the book is if you want to be successful out of your local market, you have to have or create your network where you want to invest. You need a good and trustworthy local realtor, lender, property manager, and handyman / general contractor, depending on how much work needs to be done in the foreseeable future.

Tom Ott · Answer

Thanks for the shout out @Nathan G. !

I would agree with some of the other posts in here. It can be VERY difficult to go it alone, especially if you work any kind of full-time job. If you are not ready to become a landlord or professional flipper FULL TIME, then you should seek out professionals. Look for an established team. If you want to do it in one sitting, I would look into a Turnkey. A Turnkey company will own, renovate, and manage the property all in-house. They will not use any third parties and since they owned the property they actually know what they are talking about. If not, you could go it alone and buy one you think works, but you will still need a management company, and you risk the property needed a lot of work after you buy it.

Good luck to you! Send me a message if you have any other questions,

Andrew Johnson · Answer

@Nicolette Alger I'm a long distance "landlord" but I prefer to think of myself as an "owner".  I use a property manager and would suggest you do as well.  Others will disagree and the great thing is...they're right too.  There isn't a right/wrong answer on that one but I just have zero desire to do that, find go-to handymen, contractors, find someone to do showings for me, etc.  It's just not what I want to do.

You can read plenty about systems but the biggest roadblock you'll probably face is mental.  You won't be able to drive by the property yourself.  You'll have to trust the bids for rehab.  You'll have to trust that it needs rehab (even if it's just touch up paint) at turnover.  You'll basically have to learn to focus on the "big stuff".  And that usually boils down the vacancy.  But you'll even have to trust that your PM has picked the right price for the property.

Now you can trust "but verify" all of these things but if you have to get into the weeds on every single aspect.  Well, invest locally an manage yourself.  You'll save yourself money on plane tickets, agitation, and time.

Long distance landlording?

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