Help the Newb.

[Felicia Mallet]

Greetings all, 

My boyfriend and I are dipping our toes in the water on real estate investing. It's something we've discussed for months, yet we're paranoid about starting. We both work as contractor in Iraq, and are only home for about a month every four months, so however we invest, it would involve a third party to manage. I honestly know nothing about real estate, so any tips and/or directions are appreciated. I'm currently reading BiggerPocket's beginner's guide.

[Jesse Waters]

Felicia, 

You are on the right track by getting on BP & reading the beginner's guide.  It sounds like you are looking into doing buy and hold rentals.  Take some time to learn your local market, decide where you want to invest, even if you have to adjust your target market some, and find the sweet spot in your area.  In my area, when we look at single family properties, we generally focus on properties in the $85k-$100k range, since they generally rent for $850-1000/month.  As price goes up rent's don't follow as well, and as price goes down the rents don't go down as much but tenant quality starts to drop & those properties don't appreciate as well.  Always make sure the numbers work, if they don't either negotiate so the numbers do work, or move on to the next one.

Next, learn how to evaluate a property & figure out what your cash flow will be.  Assume that half the rent will go towards expenses (management, taxes, insurance, maintenance & repairs.)  Also, I am guessing that you will be putting a down payment on a property, but I like to analyze it as if the property will be financed 100%.  If the numbers still work then you might have a good deal.  Also, get familiar with how to estimate the rent of a property.  I usualy start with a craigslist search, rental serach on realtor.com & a stop by rentometer.com.  You can also call a local property manager & see if they have anything in the neighborhood that you are looking at or ask them what property in that area generally rents for.  

Since you will be managing from out of town, go ahead and start looking for a property manager.  Ask folks on here for recommendations & interview some of the ones near where you will be investing.  Now that I have a few established properties & established relationships with managers, I generally include them when I look at properties.  Not every one will be willing to do so, but you might find a few that will take a look at some properties with you once you get your list narrowed down to the final two or three.  It never hurts to drag them along & take them out to lunch afterwards.

Also, if you can get your property manager to direct deposit your rent checks straight to the bank that should help you out in your situation.  

Hope this helps some.

JW