Seeking long distance investing advice- How do I select a market?

Question

Hi BP!I am a new RE investor from NYC - Queens. I am currently self educating through reading books and listening to podcasts. My goal this year is to purchase 1-3 multi-family deals to rent outside of the NYC area. I am not familiar with any other states as I've lived in NYC my entire life. I am trying to select a market to invest in and I am looking for advice on how to go about researching a market. It would be great to here about how others have gone about selecting a state to invest in and figuring out what neighborhood/area they wanted to look into without having prior knowledge of the area. This process is a bit overwhelming and I don't want to get stuck on this step. All advice and comments are appreciated!Thank you,Maricruz Romero

Raul R. · Answer

@Maricruz RomeroAll signs pointed to significant growth I wanted to make sure I could see it. One thing is to see it in charts another is in person.On my first trip I spend hours driving around and zoned in a neighborhood University area at the time I saw monorail to downtown was being build in that area and knew it would only increase the value of properties.I like being close to major Hospitals/ Universities feel there will always be a demand even during a recession

Maricruz Romero · Answer

@Anthony Katsonis thank you will look into what turn-key companies have to offer!

Maricruz Romero · Answer

@Justin M. thanks for the advice, that's a really good approach I will definitely start looking into other states where I have contacts.

Maricruz Romero · Answer

@Raul R. thanks I am currently finishing David Greene's and I am at a point where I need to select a market before building a team. Will definitely keep landlord friendliness in mind when doing my research, I also found the Milken report will leverage it. As for visiting the cities, what did you take consideration once you were there to make your decision? Also how did you select a specific area/neighborhood of interest?

Maricruz Romero · Answer

@Eric Veronica thanks for the suggestion! Will try that out. I plan to be more active on these forums so hope that will help out too.

Anthony Katsonis · Answer

Absolutely!

Anthony Katsonis · Answer

@Maricruz RomeroLook into turn-key investing. I would consider it a viable option for someone that has cash to invest but doesn't know much about a market and doesn't have contacts to manage and do the work. There are tons of turn-key companies on BP, and they generally target markets that are good to invest in. But by all means do your own due diligence to make sure the market is good to invest in, and that the company make sense for your situation. Hope that helps!

Justin M. · Answer

Another approach is to look into markets where you have friends/family that can generate leads or work with local real estate contacts. This gives you a kind of immediate secondary relationship that might make it easier to start your "team."I too am looking for OOS deals all the time because of our competitive local investment market, even though I did just close a deal here last month that worked out ok.

Eric Veronica · Answer

@Maricruz Romero there are a lot of investors from the northeast and California who are investing in the Midwest. There are quite a few Facebook groups titled “out of state investors of X city”. Otherwise there are local forums on BP which can be helpful.

Raul R. · Answer

Hi Maricruz,Ive been investing OOS for a few years now, I chose to invest OOS because our market is too expensive and couldn't find any cash flowing deals in our market.. I was looking for a market that Appreciates and Provides cash flow every month..I highly recommend reading David Greenes book in investing OOS, I read it after I started investing but it had great tips. Finding your team will be key and the book will go over the "Core 4".Before you even find your Core 4 you will need to find your market.. As mentioned I looked for a market that Cash flow and appreciates. Being a New Yorker and hearing all the horror stories about Professional Tenants I decided to invest in a Red State, without getting too Political all I will say is when you do your research you will find Red States are more Landlord Friendly... I looked for Population & Job growth, easy flights to/from NYC, no Snow and as mentioned friendly Landlord Laws. I picked 3 cities visited all 3 and made a decision..Do a google search on Milken Institutes Best Performing Cities 2018, it will have good info that might help with your research..Best of Luck