Boots on the Ground - Out of State Investing

BRRRR - Buy, Rehab, Rent, Refinance, Repeat
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Boots on the Ground - Out of State Investing

Sharonda Frazier
Rental Property Investor · Brentwood, CA · Member since 2022 · 24 posts · 9 votes

I have a lead/potential deal in another state. I was told I should have a contractor visit the property on my behalf to give me an accurate rehab estimate and a property manager to find out about market rent in the area, neighborhood crime etc. 

My question is - Will a contractor take time out of their day to view a property like this? If so, how do I find these type of contractors?  Do I ask multiple to look? Will a property manager even go through this trouble when the house isn't under contract yet? Seems I would have to hire them first.  to Any help is appreciated as I am new to out of state investing. 

Thank you!

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Malcomb StapelPro Member
Investor · Topeka, KS · Member since 2020 · 669 posts · 488 votes
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@Sharonda Frazier  it's not going to hurt to ask them to go look at it for you. However, you may be behind the curve on this one. I would think once you've identified the market you want to be in, you would then set up your team there before you found a property you were interested in. Right now, it sound's like your trying to assemble the team after the fact? As for contractors, do you have experience working with them?  

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  • Malcomb StapelPro Member
    Investor · Topeka, KS · Member since 2020 · 669 posts · 488 votes
    4y

    @Sharonda Frazier  it's not going to hurt to ask them to go look at it for you. However, you may be behind the curve on this one. I would think once you've identified the market you want to be in, you would then set up your team there before you found a property you were interested in. Right now, it sound's like your trying to assemble the team after the fact? As for contractors, do you have experience working with them?  

    1Reply
  • Joshua JanusBusiness Member
    Realtor · Cleveland, OH · Member since 2021 · 1k+ posts · 1k+ votes
    4y

    @Sharonda Frazier In my market, there are contractors that will go out, walk a property and give the potential investor a bid. It is a useful tactic to use for those attempting to BRRRR out of state which is not an easy feat.

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  • Sharonda Frazier
    OP
    Rental Property Investor · Brentwood, CA · Member since 2022 · 24 posts · 9 votes
    4y

    @Joshua Janus thank you for your insight. I might reach out to you as we're considering BRRRRing in Columbus!

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  • Sharonda Frazier
    OP
    Rental Property Investor · Brentwood, CA · Member since 2022 · 24 posts · 9 votes
    4y

    @Malcomb Stapel thank you for your comment. It makes sense to have the team in place prior to closing. I am curious how to approach property management. Wouldn't I need to hire them in order to get information from them such as market rents, crime rate in the neighborhood etc.? How can I do that if I don't own property?

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  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
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    @Sharonda Frazier

    You can assemble a team before or after you find a property, but which option gives you more time to interview multiple vendors to be able to learn and select the best one?

    So, let's pretend you are a contractor and are contacted to provide a bid from an out of town POTENTIAL owner. How much time would you spend on putting together a comprehensive bid - for free? Especially when every hour you spend on the bid is an hour you're NOT working and getting paid? What's more, how many times will you be willing to do a free bid, before you get tired of working for free?

    Yes, there's always another contractor desperate enough to do free bids, but in our experience, the best contractors are the busiest and don't like to do too many free bids. As soon as they find out you're from out ot state and don't have a local PMC or agent assisting you, they don't have a lot of confience in you actually going through with the purchase and hiring them - so they will either ignore your request and charge you.

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
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    Quote from @Sharonda Frazier:

    I have a lead/potential deal in another state. I was told I should have a contractor visit the property on my behalf to give me an accurate rehab estimate and a property manager to find out about market rent in the area, neighborhood crime etc. 

    My question is - Will a contractor take time out of their day to view a property like this? If so, how do I find these type of contractors?  Do I ask multiple to look? Will a property manager even go through this trouble when the house isn't under contract yet? Seems I would have to hire them first.  to Any help is appreciated as I am new to out of state investing. 

    I agree with @Drew Sygit: your search for a contractor should have already happened. If you find a property first, then you are rushing to find an available contractor with no knowledge of their competency, how they work, if they charge fairly, etc.

    If you are serious, you will pay the contractor for his time. Tell him to walk the property and provide a bid. If you hire him, include the inspection time as part of his contract. If you don't hire him, pay him for his time at the going rate ($60 an hour or whatever).

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  • Austin McClainBusiness Member
    Real Estate Agent · OH · Member since 2021 · 348 posts · 602 votes
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    If a contractor is looking for new business they should be open to giving a free quote hoping to get the job. Worst-case scenario, if no one does this, you could pay a small estimate fee to them. I think that would be worth the money if needed. 

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  • Matt Lyons
    Rental Property Investor · Chicago, IL · Member since 2019 · 109 posts · 443 votes
    4y

    Ideally you would already have a team in place (as per the advice of David Green for investing out of state) since you dont have that in place I would suggest you maybe reach out to a BP member from that area who might be willing and able to offer advice and use of their local team.  For example, if this location was in Fulton IL and you posted that you needed help there I would happily connect you with my property manager and the contractor I use there.  I would also offer to go out myself and give you my thoughts and opinion and I feel other BP members may as well.

    You run the risk of that BP member "stealing your deal" but I like to trust people and hope they would not do that...its a risk, but buying without seeing and not having a trusted team in place is a risk as well, so I would take the risk of leaning on a local BP person, possibly consider a partnership as well with that same BP member

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  • Malcomb StapelPro Member
    Investor · Topeka, KS · Member since 2020 · 669 posts · 488 votes
    4y
    Quote from @Sharonda Frazier:

    @Malcomb Stapel thank you for your comment. It makes sense to have the team in place prior to closing. I am curious how to approach property management. Wouldn't I need to hire them in order to get information from them such as market rents, crime rate in the neighborhood etc.? How can I do that if I don't own property?


     More than likely you will interview with them over the phone or zoom. Get to know them, ask questions, let them ask theirs. If it seems like a good fit, they should be more than willing to provide you with rent comps for the areas your looking, with the understanding that you will hire them when the time comes. 

    1Reply
  • Sharonda Frazier
    OP
    Rental Property Investor · Brentwood, CA · Member since 2022 · 24 posts · 9 votes
    4y

    @Austin McClain @Drew Sygit @Nathan Gesner I have no problem paying them for their time and for the bid. I just didn't know that was a thing. I am very new to all of this.  So, I'll take your advice for future deals. Thanks!

    0Reply
  • Sharonda Frazier
    OP
    Rental Property Investor · Brentwood, CA · Member since 2022 · 24 posts · 9 votes
    4y

    @Malcomb Stapel Thank you! I'll try this. 

    0Reply
  • Sharonda Frazier
    OP
    Rental Property Investor · Brentwood, CA · Member since 2022 · 24 posts · 9 votes
    4y
    Quote from @Matt Lyons:

    Ideally you would already have a team in place (as per the advice of David Green for investing out of state) since you dont have that in place I would suggest you maybe reach out to a BP member from that area who might be willing and able to offer advice and use of their local team.  For example, if this location was in Fulton IL and you posted that you needed help there I would happily connect you with my property manager and the contractor I use there.  I would also offer to go out myself and give you my thoughts and opinion and I feel other BP members may as well.

    You run the risk of that BP member "stealing your deal" but I like to trust people and hope they would not do that...its a risk, but buying without seeing and not having a trusted team in place is a risk as well, so I would take the risk of leaning on a local BP person, possibly consider a partnership as well with that same BP member


     Thank you. I've decided to let this potential deal go and work on my team so that I'm prepared next time. Appreciate your advice. 

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