Out Of State Income Property....To Buy, Or Not To Buy?
I'm looking for cash flow duplex/triplex/fourplexes. CA. market is too pricey. Some other areas look much better from a price/cash flow perspective. What do you all say? Is buying out of state a total nightmare because your far from your property.....Or, does a professional mgt. company make it work?
A reputable management company will definitely make it worth your while, but you will need to buy enough units to make it worth there cost. I personally wouldnt do it for any less than 10 units as the cost would not be worth the investment.
Kyle
I am also looking for alternative investment out-of-state.
I think the most difficult part is that you have to know the areas, locations, rental market, etc. Unless you have friends or relatives there, you probably have to travel there at least to sign the contract.
Will property management or realtors do your homework for you??
Can experienced out-of-state investors recommmend course of actions so you won't get negative cashflow or out-of-state bad REI?
I live in CA and just bought a nice 14 unit in the midwest. The property management is very good and even with their 7% fee it still has a respectable cash flow. I get a statement every month along with a check. I started by finding a management co. and talking with them about what they will and will not manage. They are a wealth of knowledge and may give you some great leads. Try it--it's only a phone call. Plan on spending some time away from home doing the deal. After that it's clear sailing. Good Luck ! 8-)
I'm sure you can make it work, but be prepared for some disappointments. I seriously doubt that you will make as much income as you would if the property was nearby where you could check on the place frequently. PM's don't go over the property the same way you would , looking for minor problems before they become big ones.