What advice can you share for a beginner exploring both local and out-of-state

[Ying Tang]

Hello everyone,

I’m excited to join BiggerPockets as a new investor and realtor based in Phoenix, Arizona. Currently, I own two single-family homes:

1. My primary residence, purchased in 2018 for $550K, is now valued at approximately $900K.

2. A recently renovated property bought in 2023 for $440K with 25% down is managed by a friend’s company. They rent out individual rooms, enabling us to charge slightly above market rates. Despite higher maintenance costs and elevated interest rates, the property generates enough income to cover the mortgage plus an extra $200 in positive cash flow.

Each year, my husband and I save between $80K and $200K for further investments, depending on his annual performance. I also recently obtained my Arizona real estate salesperson license to reduce transaction costs. While I’m actively seeking BRRRR opportunities in Phoenix, generating positive cash flow has proven challenging under current conditions, and price appreciation appears to have slowed.

In addition, I’m exploring investment opportunities out of state, though navigating unfamiliar markets is proving to be even more challenging. I welcome any suggestions, advice, or insights you might have regarding investments both locally and beyond. Thanks in advance for your input!

[Patrick O'Sullivan]

Hi Ying, welcome to the forums and congrats on what you've already built—your current position puts you in a great spot to scale thoughtfully!

You're definitely not alone in finding it tough to make BRRRR work in Phoenix right now. A lot of investors are in the same boat, especially with high acquisition prices and tighter cash flow margins. It's smart that you're also looking into other markets, though as you mentioned, getting comfortable out-of-state takes some effort.

A few thoughts based on your situation:

• Local Advantage: As a licensed agent, you already have a huge edge locally. Even if Phoenix deals aren’t penciling today, you might find opportunities in nearby secondary markets where your boots-on-the-ground knowledge still applies—places like Tucson or parts of the West Valley have been mentioned for better cash flow potential.

• Out-of-State Strategy: If you do go out-of-state, the key is strong due diligence and building your team before buying. Focus on landlord-friendly states with stable job growth. Many investors have had success in places like Indianapolis, Kansas City, and parts of Ohio and Florida. Just be prepared for a steeper learning curve in the beginning while you're getting familiar with new submarkets and local quirks.

• Financing Choices: You mentioned using a 15-year loan—great for building equity quickly, but it does eat into cash flow. Many investors opt for 30-year fixed to maximize monthly spread, especially early on. It might be worth running the numbers both ways on future purchases and seeing which strategy fits your long-term goals best.

• BRRRR Today: In this environment, it helps to be flexible—maybe combining a value-add rental strategy with occasional flips or partnerships. Also, keep an eye out for distressed properties where you can force appreciation, which makes the refinance stage of BRRRR much more powerful.

Appreciate you sharing your journey—looking forward to seeing how you continue to grow your portfolio!