8 Things to Know Before You Invest Out of State| Real Estate Investing

8 Things to Know Before You Invest Out of State| Real Estate Investing

What’s up legacy builders I’m Rob I’m
Reshawn and this is Learn Hustle Grow we help you build wealth and explore entrepreneurship so
that you can leave a legacy she’s a travel agent he’s a realtor and we are
debt-free entrepreneurs Rob and I have been real estate investors for the last
six years if you know our story then you know that investing in real estate
allowed us to leave our corporate jobs travel the world and become
entrepreneurs in this video we are going to share 8 things you need to consider
before purchasing real estate in another state number one you need resources you
need boots on the ground someone to be your eyes and ears since you live out of
state absolutely so you need to find yourself a local realtor yeah that
Realtors gonna give you access to the MLS number one yeah and the best way to
do that I believe is to get a referral you know someone that’s connected to
someone in that city that would be fantastic right yeah even better if that
person who’s making the referral is also an investor because they have an idea
what it’s like to work with a realtor who knows what you’re looking for right
also there is an online resource called BiggerPockets the community that all of
these like social media for real estate investors right everyone talks about
their cities everyone makes recommend recommendations and stuff so if you use
bigger pot the bigger pockets network then you probably can find a local
realtor in that group yep absolutely that’s an excellent option babe yeah
worst-case scenario if you are not coming to Texas to invest with Rob and I
you could look up a realtor on Google yes that’d be a worst-case scenario
so definitely get that local realtor first and foremost next in the area of
resources and boots on the ground you are going to need a property manager
yeah property managers are that’s a tough one because you have to find a
good property manager right we know that and the property manager has to be there
to answer those questions and those late-night phone calls and to actually
go out and take a look at the property when you are not available we certainly
would not recommend an out-of-state purchase without someone that is going
to be a primary contact for your tenants and one of the ways in which you can
locate a property manager is the in a rpm or in a PRM one of those in a rpm
okay great is the National Association of rental property managers you can
check them out online that’s a great resource also you can look on reviews
you can check on reviews on the BBB for example
that’s always a great resource and they have grades for the businesses and they
have comments and everything right yeah you can actually look at previous
complaints I think a lot of you or forget about their local Better Business
yeah that’s a great yeah it’s a great one so most likely if they got a a
rating they’re pretty good business right so you can get an A or B rating
also there’s Yelp Yelp reviews just like a lot of review sites
yeah I’ve reviewed everything from restaurants to my dentist and property
managers using Yelp mm-hmm yep and now the latest one this out now is on yellow
pages yeah the yellow pages calm they’re trying to get into the space now of
reviews so and why not right they have all the businesses listed online so I’m
guessing they are hoping that there’s an opportunity for them to get in on the
user review experience as well it’s just another opportunity to get a different
perspective yeah Andy before we go any further please like subscribe and click
that notification bell we don’t want you to miss a single video
the third resource that you will need is a local lender the reason why I say a
local lender is because locally you should be able to get a better rate yeah
that is a great tip babe and one of the things you want to be
would be aware of unfortunately a lot of local lenders will not lend to an
out-of-state investor right they will not yeah they just feel like
it’s too big of a risk if you don’t live there leave the country right worst case
scenario you can’t go with a national lender a big bank Bank of America Wells
Fargo these these are things you just want to consider before you make the
purchase however the route what are the resources that are available to you the
second tip for buying real estate out of state is establish your criteria what is
your budget first of all right you know if you are
going to another state you might want to know what your budget can buy right yeah
one of the driving factors for leaving your home state may be getting more bang
for your buck but you want to have an idea of just how much you can spend
before you you even begin looking yeah and another thing is how many units can
your budget purchase right are you buying a single-family home or a
multi-unit place that all kind of falls under the budget also right yeah one of
the things we actually covered in a previous video on real estate investing
was the fact that the 1 to 4 loan from your lender can cover anywhere from 1 to
4 units so when you are buying that when you are getting pre-qualified for the
property you may find that you can get a duplex out of state for what you would
normally pay for a single-family home in your home state that’d be nice
the location what location in the preferred city will you be purchasing
you know north-south-east-west right some places are much more expensive and
some are more affordable even in those cities right yeah absolutely you
definitely have your class a neighborhoods versus Class B or C and
that’s going to impact what you can demand for the rent and your return on
investment how much you trying to make they are
several online calculators on our favorite website burger pockets or just
on Google on what your return is going to be yeah and we’ve list this as a key
part of your criteria because when you are house shopping it can be easy to
fall in love with the property itself weight yeah and that’s not what you want
to do no especially with an investment you know you want to make sure it’s
making money first and foremost you know even though it’s not in the best
neighborhood it probably still can make money make money this is not your home
no so ry is more important than granite countertop yeah but I don’t want those
in a row though anyway you know unless it’s a high in row so number three
choose a city you are familiar with yes neither Rob nor I are Texas natives he
is from the Norfolk Virginia area I am from Chicago Illinois with that in mind
when we began our search to real to invest out of state we started with
those two cities also if you have friends or family that you frequently
visit and you know you love the area I’m always looking for example at a
potential out of state property so you if you if you go there frequently you
know or if you just like the area you’ve been there and you love the area and you
think it can make money that might be an option also yeah we would love to own in
the state of California gonna say Martha’s Vineyard we just simply can’t
afford those so Texas is still a great place to buy for us yes yes we’ll stick
with Texas until we find somewhere you know that can’t compete with these
prices so number four choose a location where you can make money for example is
the city growing yes what’s the job market like in that city exactly if you
know if there’s a potential for growth you definitely want to get in on the as
close as you can to the ground floor right there are tools online you can use
to research all of this information population job growth economic
development you can actually find economic development information on the
city’s website and what’s the rental market in that area you don’t want to
purchase something that you can’t rent out
yeah if the opportunity to buy is less expensive than it is to rent then it
might not be a good time to purchase your rental property or that specific in
that specific location another thing you might want to look at is does the
property manager for potential property manager feel safe in that area yeah this
is why it would be a good idea to have a property manager because they can tell
you whether or not that’s a neighborhood they would be willing to go to if they
are not willing to go to the area probably not a good place to buy now
number five let’s say you’ve picked a city you are familiar with but you’re
not necessarily that familiar with the neighborhood within that city if that’s
the case you want to take advantage of online tools what are some of the tools
we’ve used back Google Street View that one has been very valuable because that
when you type in an address and you zoomed in to that Street View and you
see you know abandoned baby cars or people standing on the corner and you
know it’s broken down Finch you like maybe not this area or maybe you’re into
that sort of thing yeah but it just helps to know right well you get a B I’m
sure you get a deal but another one was neighborhood scout
neighborhood scout that’s a great one it’s got plenty of information on it
yeah that one actually gives you a report of what the people in the
neighborhood are like kind of the cultural breakdown oh that’s pretty good
yeah pretty good yeah probably got schools and everything around there too
right yep and of course good old YouTube YouTube a lot of people talk a lot of
talk about their neighborhood yeah I would like for example we just did a
video on our channel about you know Plano Texas right you know and people
love it right we also did downtown Dallas oh yeah and in downtown Dallas so
there are people out there making YouTube videos about a specific
neighborhood and you can at least you know check it out through the eyes of
them and if you know at least that section of the of the city yeah the
internet is definitely to your advantage these days so take
Vantage of it mm-hmm number six research tenant-landlord laws in the city that’s
a big one it is very important you know we are the loss friendly to you as a
landlord yeah or are you gonna be struggling to
get people out they don’t want to pay your rent right yeah that can be a
struggle not a whole lot more to say on that and do your research how much is it
gonna cost to evict someone right definitely want to know that number
seven get an inspection you may find that when you work with an out-of-state
realtor if they love the property then they may say you don’t need an
inspection and not getting an inspection can be viewed as a way to save money we
strongly advise against this yes get an inspection under all circumstances yep
get a thorough one if you can most inspectors they mainly check out
the structural parts of the house like the foundation the electrical make sure
there’s no leaks in the roof all that type of stuff
yeah and how would you go about finding one of these inspectors call your local
realtor and tell them you want a thorough one you want a fantastic
inspector someone who doesn’t take any shorts because you’re buying out of
state yeah and if your realtor for whatever reason doesn’t have a
relationship with an inspector then of course you can always shop online for
home inspectors or property inspectors you have to check out those reviews
people let you know number eight last but not lease on our tips for what to
consider before buying out of state visit the city yourself so you might
want to just go ahead and if you have the means to go ahead and visit the city
yourself and check out some of the local areas yeah there’s nothing like being
there in person when you can’t make a trip go in offseason if you are
considering coming to Texas for whatever reason go ahead and start looking at the
price of those tickets now right yep check out different neighborhoods and
you can get a feel for yourself just like at home right and you can’t
sometimes you kind of when you drive through a neighborhood
whether it’s family friendly whether it’s not so friendly whatever right yeah
if you visited the state at least once and narrowed it down to a specific city
or neighborhood that will make it so much easier for you to work with the
resources that aren’t boots on the ground and it’ll give you a chance to
meet those people in person meet with a few Realtors meet with a few property
inspectors find out if you guys are clicking if you are connecting and can
work well together and they’ll let you know what’s going on with each
neighborhood and what you should and shouldn’t buy and where they would buy
if they could write have you purchased any real estate out of state are you
considering purchasing out of state would you consider purchasing in the DFW
market if so Rob Lee is your local realtor we want to hear from you comment
below see you next video

3 thoughts on “8 Things to Know Before You Invest Out of State| Real Estate Investing

  1. Happy New year! Considering but have to get rid of the student loan first then we can seriously start looking into this. But these were great tips

  2. Wow..of course in any profession there is so much to know. It appears that you guys have not only passion, but a real calling for both travel and real-estate. I would certainly request you both as advisers for any type of real-estate purchase investments or travel advice. Thanks for your willingness to educate the public on these matters. Great tips across the board. Kudos

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