Buying Rental Property Out Of My Area
I would like to buy rental property, but it is too expensive in my area, and the numbers do not work. I found 2 cities, both about 100 miles from where I live (one and a half to two hour drive each way). I really don't mind the distance. I have studied investment real estate, looked at many properties and spoke to many people in the industry, and I am ready to get started. Do you think the distance from my home will cause me problems and ultimately cause me to fail? Has anyone bought investment rental property 100 miles from where they live?
All of my RE investing is a minimum of 90 miles away with some as far as160 miles away. That's where the cash flow is. That's where the rehab's are. That's where the money is. And this is what I do and I love it.
Good luck,
Noel
[addsig]
Do you ever have any issues due to the distance that you would not have if your property was in the same town you live in?
If you are planning to manage these properties yourself, I think it's important that you are nearer to your rentals - especially with your first experiences. If you are planning to hire a property manager to handle them, and you don't want to be involved in the management activities, I don't see a problem with a little bit of distance. I have a couple of properties nearby (within 30 minutes), and for the most part I don't bother with them at all. Sometimes I'll drive by to be sure they are still standing and in presentable condition from the outside, but that's about it. They might as well be in Timbuktu, for all that it matters to me. The key, if the property manager route is the one you want to take, is, of course, to find a competent manager. If you decide to manage yourself, you'll not want to be driving back and forth any great distance. Well, that's my opinion, anyway. Z
I stand by my decisions to invest where I invest and live where I live - miles and miles apart.
And I don't buy the argument that you can't manage your own properties if they are 'at a distance' even as a new investor. I have only been investing for 2 years. Bought 6 houses my 1st year, maintained them as rentals from afar and have succeeded and continue to succeed. Creative management skills 101.
Last year I did 2 complete rehabs from afar. I continued to manage my rentals from afar. I farm areas from afar. I make offers, sell properties, negotiate and am making good money from afar.
Alas, we live in the age of cell phones and computers and fax machines and research galore at our fingertips. I would recommend a solid vehicle in good running order and an amusement for long drives. But then, I grew up in LA where you had to drive an hour or more to get anywhere anyways so a few more minutes to make some good cash and have fun........sure beats a cubicle.
If you think you can do it, then you can.
Noel
PS - Of course there will be issues due to the distance and you can work them out if you really want to. One bonus is that if a tenant gets mad at you, they can't just drive by your house and throw a brick through your window cause they probably are too lazy to go the distance.
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A little brain, a lot of perseverance and faith in the theory of it all.[ Edited by noel2 on Date 02/06/2004 ]
I own property 2000 miles from where I live. In REI , there will always be some issues to deal with, regardless of where the property is located. If the deal is good and the numbers work, go for it. After all, youre an investor, not a resident of the property...
I can say this though: try to focus primarily on big cities, as you will have all the necessary resources readily available, i.e. tenants, property managment, maintenance, etc.
I own property 2000 miles from where I live. In REI , there will always be some issues to deal with, regardless of where the property is located. If the deal is good and the numbers work, go for it. After all, youre an investor, not a resident of the property...
I can say this though: try to focus primarily on big cities, as you will have all the necessary resources readily available, i.e. tenants, property managment, maintenance, etc.
Do you invest your money just in your local bank? Chances are you probably have money in the Stock Market and in effect have money invested in companies all over the world. This money is being mangaged by others and you get the return. Similarily with investing in real estate outside your local region. I have invest property outside my area being mangaged by a management company. I could manage it myself and deal with the distance creatively but decided that having others manage it best suited my style and needs. Don't let distance scare you.
Q
P.S. I can get you propery in NC if you want... Joel don't take that as advertising
AptHunter,
How did you acquire your long distance properties? Also, how do you manage them? (outsourced prop. mngt?)
I think the idea of investing far away from where you actually live, in another city and/or state, is a good way to stay ahead of the game because RE values are mostly determined by region ..
I was able to buy properties far away as I travel quite a bit for my job... and I do endless research on the internet for real estate.
For my properties, I find tenants who are responsible. If something goes wrong, I tell them to just call the maintenance person, plumber, etc , pay them, and then deduct the amount from their rent and include the invoice for my records which I deduct on my taxes. Its fairly easy...
I invest in my own area and outside my area and will continue to do the same. Theres no rule written that I am not allowed to buy something outside my own area....ahhhhhh....dont you just love the free world?