Oakland, CA native beginning real estate journey

[Ryan Espinosa]

Hey BP -- My name's Ryan Espinosa. A little about myself: I've spent the last 7 years trying to make self-driving cars (and now commercial trucks) a reality. Some hobbies of mine include: cycling, climbing and playing/making music [soon to include real estate as well ;) ]. 

Shameful fact, I actually have been signed up as a member since 2018, but only now am coming around to attempt to be an active member here. I'm finally feeling ready to take the plunge and expand my investment portfolio to include real estate! My current thinking is to find something SFH turnkey in an out of state market, as most of my time is dedicated to my 9-5 & newborn son.

A couple quick questions I have:

-What are folks currently doing in terms of REI clubs/meetups? Going to an event would have been one of the first tasks for me, but given our current state, I'm wondering how folks are creatively continuing to meet/network.

-Fellow Bay Area residents, any recs for groups to join up with? Hoping to find some opportunities to connect with other local bay area investors and talk shop... success stories, mishaps & all..

Thanks for reading!

[James Wise]

Originally posted by @Ryan Espinosa:

Hey BP -- My name's Ryan Espinosa. A little about myself: I've spent the last 7 years trying to make self-driving cars (and now commercial trucks) a reality. Some hobbies of mine include: cycling, climbing and playing/making music [soon to include real estate as well ;) ]. 

Shameful fact, I actually have been signed up as a member since 2018, but only now am coming around to attempt to be an active member here. I'm finally feeling ready to take the plunge and expand my investment portfolio to include real estate! My current thinking is to find something SFH turnkey in an out of state market, as most of my time is dedicated to my 9-5 & newborn son.

A couple quick questions I have:

-What are folks currently doing in terms of REI clubs/meetups? Going to an event would have been one of the first tasks for me, but given our current state, I'm wondering how folks are creatively continuing to meet/network.

-Fellow Bay Area residents, any recs for groups to join up with? Hoping to find some opportunities to connect with other local bay area investors and talk shop... success stories, mishaps & all..

Thanks for reading!

 Welcome aboard Ryan. As for your desire to do some turnkey investing there are going to be a ton of turnkey type markets available. Cleveland, Ohio is the one I am most familiar with and it's also very popular with investors across the USA so I figured you'd get some value out of reading The Ultimate Guide to Grading Cleveland Neighborhoods. I also have similar guides that you may want to look over for Kansas City, Missouri. & Birmingham, Alabama.

In addition there are tons of other turnkey markets out there besides those listed above. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. In no particular order I have listed some of the most popular markets for out of state investors

• Cincinnati, Ohio
• Dayton, Ohio
• Toledo, Ohio
• Youngstown, Ohio
• Cincinnati, Ohio
• Memphis, Tennessee
• Saint Louis, Missouri
• Indianapolis, Indiana
• Detroit, Michigan
• Erie, Pennsylvania
• Louisville, Kentucky
• Milwaukee, Wisconsin
• Jackson, Mississippi

Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.

One thing to note when looking at the individual markets, you can make or lose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.

• Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
• Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
• Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
• Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
• Make sure your property manager is a licensed real estate brokerage.
• Google Clayton Morris lawsuit and/or Morris Invest fraud for a cautionary tale of what not to do when buying turnkey real estate
• Understand you can not eliminate all risk, only mitigate it. If you are risk averse, real estate, (especially out of state) is not for you.