Long Distance REI as a Newbie

[Hannah Noble]

Hi, my name is Hannah and I am new to REI. For the past few months I have been educating myself and soaking up anything I can. I know sometimes getting started and pulling the plug is the hardest part. I want to be able to start my REI journey soon. Right now I am saving up and trying to get pre-approved so I know how much I can afford. I currently live in Orange County in Southern California, which is a very expensive market. As a newbie I wanted to start out east just to kind of get my feet wet as I'm still learning. I was wanting to use the house hacking method on my first investment. However, being such a high priced market I know that most likely there won't be much to any cash flow here. This isn't a make or break it factor for me, especially it being my first. However, I was wondering what more experienced investors opinions are on being a newbie REI and doing a house hack in an expensive market versus doing a multi-family rental property out of state in a cheaper market with more cash flow. I know there are pros and cons to both, but curious to hear what others have had success in and possibly in what markets if they are doing long distance and of course taking into consideration everything that is going on right now with COVID.

Thanks!!

[Jared Baumer]

@Hannah Noble There are definitely pros and cons to both local and out of state investing. When it comes to investing out of state it is extremely important to build a reliable team in the market you want to buy. Making sure you have solid boots on the ground can make your out of state REI experience much less of a headache. My first investment was out of state right before COVID hit actually and I give a lot of credit to my PM on their tenant placement since I am still cashflow positive during these times. Do you have an idea on which markets you are considering for an out of state investment? Midwest markets are typically a lower price point with a greater chance of positive cashflow.