Buying Out Of State - Posted by R. Brown

Posted by Ronald * Starr on August 20, 2001 at 22:08:43:

R. Brown-------

I live in Oakland, CA. I have properties in CA and now am acquiring rental houses in OK. I’ve been doing that for three years, have 5 properties now, will probably have some more next year.

I do not recommend that you own a single rental property at a distance, unless:
–you will be going there several times a year for some other reason so you can see how the property is doing.
–you have somebody to help manage the property for you. This could be a friend, relative, or even a professional management service. They should be able to handle small repairs themselves or know good, low cost people to bring in to do the work. They should be willing to insist that the rent be paid, and give eviction notices if necessary. They need not collect the rent–it could come to you directly.
–The rental income is higher than you could get with properties local to where you, given the amount of money you invest.
–You are not a beginner. I would recommend that a beginner steer clear of this sort of situation.

It is easier to own apartment complexes or other larger investment properties from a distance, with competent local property management.

You mention the property “listed.” It this is with the multiple listing service and is still available for sale, it is almost certainly not a great bargain. If it were a great bargain, at less than 60% of market value, say, then you might consider buying it and reselling it quickly. But if it is being exposed to the open market place and is not sold, you should not buy it, in my view.

Good InvestingRon Starr*****

Buying Out Of State - Posted by R. Brown

Posted by R. Brown on August 20, 2001 at 18:02:46:

I am new to real estate investing. I have read much, but haven’t done any transactions. I currently have the opportunity to buy a piece of property in Texas. I live in Californa. Here are the details:

  1. The owner has property listed for $96k
  2. Owner owes $60k
  3. Owner will carry financing with 5K down
  4. Property is 3br/2ba 1500 sqft
  5. Property could possibly be rented for $1100 to $1500 per month
  6. Property has an assumable FHA loan
  7. Owner is moving to another state

Is buying property out of State a good idea? How would I structure an offer so as to get positive cash flow? Is it better to get a new loan? Any comments or suggestions would be helpful.

Thanks