On more than one occasion we at Ali Safavi Real Estate have talked about investing not just in your home town, but around the country. Not every good opportunity is local. Hot markets and good deals pop up all over the place. However, out of state investing is easy. Having rental properties is hard enough as it is, imagine dealing with problems thousands of miles away. Here’s a few of the biggest hurdles you’ll face when investing out of state.
Finding The Right People
At Ali Safavi Real Estate we talk a lot about finding the right team – people you trust to help your investing strategies succeed. Real estate agents, lawyers, maintenance people, and others all go into a profitable investment. Sure, a good referral is great if that’s available to you. However, I find that an absence of face to face time can erode a good working relationship – out of sight, out of mind. This can lead to overcharging and bad work.
Deals Are Tougher
When you are plugged into a location for long enough you learn how to find the good deals. This is partly thanks to your team, but it’s also about knowing the area and where to look. That doesn’t work as well when you’re looking out of state. There is another "you" living in that state, dug into the trenches, and spending every day looking to find the next best property. Do you think you can compete with that? Maybe…but it’s going to be tough. This means you are going to be paying more than you should. It may be less than you’d pay in your hometown, which is a win, but just be prepared for some price hikes.
Knowing Local Laws
Are you a lawyer? Even if yes, do you know state law in all 50 states? Probably not. Unfortunately, “I didn’t know” never won any lawsuits. There’s a lot to know. You must become an expert on taxes, zoning and local housing laws. Or, make sure you have a fantastic lawyer in the area you are planning on investing.