All Forum Posts by: Rochelle Duong

Hello,

Investor from California looking to leverage a potential partnership with someone from the Kansas City, Missouri Market. Met my potential REI partner through a mentor and we've all been meeting weekly to get started on deals. We've already vetted eachother out and seem to have similar investing philosophies when looking for properties. My potential OOS partner would be "boots on the ground" and he was going to do the leg work, said he could manage repairs, oversee the property, and is currently in the process of obtaining his REA license. I have a steady income, excellent credit, and cash reserves, and have the time and knowledge to help touch base with him weekly. We were gonna go 50/50 into the deal where both of us contribute 50% of cash reserves for an initial down payment. One of the things I'm aware of is to have things written out and have an attorney look over contingencies that he and I both lay out, so that things are "fair."

He and I are both new at this; It would be his second deal (his first is his house hack) and my very first deal. Any tips would help so we can be prepare and make sure that this partnership works out for the both of us.

What are some of the ways some of you have structured out of state deals? What are some suggestions that I could do to contribute to this partnership moving forward? 

@Stone Saathoff 

Hi Stone, yes I was looking into the San Antonio market as well too. I've read somewhere that property taxes in that state are higher than the national average. I need to do a bit more reading into how significant property taxes can affect the overall picture, but the houses there are alot cheaper than the CA markets here. 

Hello!

I hope you all are doing well during these times. I made it a goal for myself each day to practice running numbers in order to finally take action on deal analysis. If any of you are currently investing out of state from California, what states are you currently looking at and what criteria did you guys develop in order to choose that market? 

And about how much capital would be a good start for a down payment if you didn't purchase the property fully with cash? I felt $25-30k was a good cushion to start out with before I look into other ways to creatively finance the rest. Thoughts? I'm saving up as much as I can right now, but due to the whole COVID situation, my reserves aren't building up as quickly as anticipated so I've been feeling in a rut lately. 

Any advice on building a team out of state would be helpful too! (in terms of who to look for, how to network when I'm slowly saving up, what questions to ask etc) 

@Josh Huber

Hello! are you LA county ? And I was gonna go to a Long beach one scheduled for next week. It was related to house-hacking though but I think it will have good info anyway just in case I decided to pursue that route in the future

@Brian Ung

Welcome!

I think a partnership is a great idea. Your partner could have a different set of skills and knowledge, assets (i.e. landlord experience, network/connections, equity, good credit, cash reserves), experience to bring to the table and make a deal happen vs. me tackling a deal alone. I'm personally someone who likes to collaborate with someone I trust so it would mean talking to that person regularly and forming a strong relationship.

@Kam Olsen

Yes I have considered house hacking locally, but the numbers in California didn't make sense for me. Even the 3.5% for an FHA loan just to purchase a decent 1-2 bed/bath condo to househack in my area would be 470-500k (not to mention the mortgage insurance premiums each month) are too expensive for me, and would not put me in a good financial position to invest in other areas. So far, cash flow with buying properties in cheaper markets out of state seems to be the right route for me

@Peice Livingston

Hello! I read your post and I'm sorry to hear that you had some hurdles with your real estate journey. If you are still continuing forward despite those negatives, then that's amazing! You've experienced first hand and know now what to avoid from letting that happen again in the future.

Although I am aware that things could go wrong in this real estate journey, worrying about what could go wrong isn't going to serve me nor stop me from moving forward. I am willing to learn the process and do my due diligence; and even if I do encounter any misfortunes along the way, I believe I'll be able to figure something out when that time comes. Currently taking things slow, and while I'm still in the initial steps for saving up, I can continue to research, form good networks (who in turn will lead me to good referrals for contractors and lenders), scope out markets, and speak to a few lenders along the way to find which ones are compatible with my interests. I know this process isn't going to happen overnight and am willing to be patient with it. 

And to your question regarding a W2 job, I don't think it is my place to give you advice since I don't know your full situation. If I was in that type of situation however, I would probably need to find a way to obtain a W2 job that can provide an income to help fund my real estate investing but I would need to get creative with the types of jobs and know that these jobs are a temporary discomfort (food service jobs, customer service, in home-supportive services for developmentally disabled). I'm not sure what barriers are preventing you from getting a W2 job, but If getting one is what you are aiming to do, I would probably need to figure out how to tackle those barriers. 

I think if you ask that question in the forums, I'm sure there are others on BP who are more familiar with that type of situation who can give more insight to your concerns. Hope this helped :)

@David Green @Greg Rulfs

That sounds like a great idea! Socal Newbie support group! If any of you know of any Socal ones coming up too, that would be great. 

David, what markets are you currently looking at? 

@Account Closed

Hello fellow SoCal investor! Congratulations on this step! Do you have a property manager to help you manage your OOS rentals? 

I hope to be in the same boat as you within the year with purchasing my first property OOS. Shoot me a DM on your broker's info for future reference if you can! I'd love to keep in touch with your journey as a new investor

@Benjamin Orozco

Since you do OOS investing, would you say having a reliable property manager is a crucial step to make this process of managing rentals easier? I was on the fence with that since I've had a friend who manages a property in Detroit distance without a proper manager, so he was able to be more profitable in this sense. Luckily his tenants (a family) take care of the property very well, but my friend also has a higher risk tolerance than I do. I'm not confident as a newbie investor to just jump in the game without using a property manager. Any insight is helpful if you have any 

Any experience with turnkey companies? if so, what are your insights on them?