How do you analyze a neighborhood while investing remotely?

[Jai Koolwal]

Hi All,

I am new to real estate investing and am looking to start out by syncing up with a coupe of turn key operators. However, what I am struggling with right now is that I a not able to scope out a neighborhoods as I am looking to invest out of state in cities I have no idea about ( I live in California bay area and looking to invest elsewhere). Just believing the turn key seller's word about the community is not enough. I am trying to understand different subtle factors like how close the location is to the jobs, is the crime high/low, is the neighborhood up and coming etc. 

Trying to figure out what the experts are doing in similar situations to get these answers. Researching online is an obvious option (& something I always pursue) but it doesn't always get you some of the angles I am looking at. 

Do you typically find a RE agent that knows the local neighborhoods & get feed back from them..or is there another hat trick that I am not aware of :)

Thanks

Jai

[Wes Blackwell]

Hi @Jai Koolwal! Great question!

Here's my simple 3 step process for investing out of state:

1. Online Research: The first step is to start wide and research the various markets that match your investing goals. Read about them on Wikipedia, City-Data, Local Newspaper, Local Business Journals, etc. To take it a step further you can research zip code demographics, local crime data, schools and education, and job growth. Then you can hop into the local forums here and ask some local investors their opinions about the market and investing opportunities. Browse around on Realtor.com and get familiar with the price points and available properties, and virtually 'drive' the neighborhoods with Google street view. This will be the most time intensive step as you will have to do this for multiple markets before deciding on your top 3-5 before moving onto step 2.
2. Contact Local Professionals: The second step is to talk with local experts, namely real estate agents. Your best bet is posting in the local forums here and asking for recommendations, as that agent is more likely to understand your real estate investing goals and can better serve your needs. Don't hesitate to start working with several of them either. Being so far apart it'll be more difficult to establish a connection, and ultimately one of them will set themselves head and shoulders above the rest. But frankly, if you do Step 1 correctly you'll likely know more about the market than they will. Just a matter of fact. But the local agent will be able to give you context about the data you've read. They're out in the market talking with clients and the public, and can give you the word on the street about the various neighborhoods, developments, local news, etc.
3. Visit the Market: Step 1 and 2 should help you narrow the selection down to 1-2 markets, and now it's time to take the final step and visit the market in-person. Try to plan a week vacation so you really have time to examine the city, as you'll have a lot to do while you're in town. You need to meet up with your agent or turn-key provider and look at as many properties as possible. Meet with local property managers and interview them. Knock on the doors and talk to the neighbors about the area. Visit the local hot-spots and talk to every single person you meet and you can just tell them you're thinking of moving to the area and asking them what the town is like. People LOVE to give their opinion and pretend the expert, so you're learn a ton about the city, neighborhood, and local culture. And if all seems well, buy something! :-)

Hope that helps and best of luck! Keep us updated of your progress!