Assembling an OOS team

[Leonard Brown]

Hi, BP community. I may be off premise a tad but this is from my perspective as a new investor myself and the working relationships I have with other investors and the common pitfalls.

When entering new markets you may be reluctant to hire people for your real estate operations but if you’re thinking of and/or are investing outside of your own backyard, relationships are necessary. Without the proper infrastructure, it won’t be long before you find yourself overextended in out of state markets, especially if you’re investing at scale.

It’s not enough to just have a deal when aiming for success in long distance investing. The reason being, the risk associated with buying an investment property are less mitigated if your only plan is the plan to make decisions on the fly. Think in terms of rehab and holding costs, vacancies, litigation, and the hair on your head.

Whether a newbie or seasoned investor, this is why putting a team together is necessary when investing out of state. I’m not saying that you have to be Mr. Monopoly, but you do have to decide if you want to grow and scale, just grow, or be a landlord. If it’s either of the last two, you’ll probably be able to make do with the occasional Craigslist hire. That team should consist of three roles: an agent, a general contractor, and a property management company.

Having a real estate agent that has a firm grasp of the local market, can source deals, understands the trends goes a long way.

A general contractor that can give you an idea of repair costs before locking up a deal, can handle your investing volume, and manage contractors (so that you don’t have to) is imperative.

The property manager handles vacancies, evictions, maintenance and repairs, etc.

Now this isn’t exhaustive of the roles and responsibilities but the point still remains. If you’re planning to invest in other markets, the needs to be structure. Having these people in place not only makes the investing process manageable and gives you the ability to replicate it if desired, you also have the ability to leverage their networks to accomplish your goals. If you don’t know where to start, your biggest ally in all of this is referrals.

Who do you have on your team?