How to Get Started in Out-of-State Real Estate Investing
Summary
TLDRIn this video, Sarah Weaver and Sulway share their experiences and strategies for investing in out-of-state real estate. They discuss the importance of selecting markets with strong metrics like population and job growth, wage increases, and rising home values. The hosts emphasize the value of building a reliable on-the-ground team through networking and referrals, and they encourage viewers to take action despite fear, highlighting how they've successfully scaled their portfolios and managed properties from thousands of miles away.
Takeaways
- 🏠 Sarah and Sulway invest in out-of-state properties, leveraging the benefits of lower prices and better cash flow in different markets.
- 🌐 They manage their investments remotely, with Sarah owning properties as far as 8000 miles away while living in New Zealand.
- 📈 Key metrics for choosing a market include population growth, job growth, wage and income growth, rent rate increase, and home value appreciation.
- 💼 Industry diversification is important to ensure a stable tenant demand and mitigate risks associated with market reliance on a single industry.
- 🤝 Building a reliable on-the-ground team is crucial for managing properties from a distance, with referrals from experienced investors being a valuable source.
- 🔍 Both Sarah and Sulway rely heavily on investor-friendly agents for deal flow, with about 75% of their properties coming through such agents.
- 📊 They also explore direct-to-seller marketing strategies like mailers, cold calls, and social media to find deals with potentially higher discounts.
- 🚀 To grow an agent network, start with online research and networking on platforms like BiggerPockets, and leverage referrals from solid team members.
- 🛑 Don't wait until everything is figured out to start investing; embrace problem-solving and take action despite initial uncertainty.
- 💪 Function in the fear: Investing, especially out-of-state, can be intimidating, but taking the leap and creating processes can lead to success.
- 🌍 Real estate investments have allowed Sarah and Sulway to travel full-time, demonstrating that with the right approach, it's possible to balance lifestyle and investment goals.
Q & A
What is the main topic of the video?
-The main topic of the video is about investing in out-of-state real estate properties, particularly focusing on how to make the jump to investing out of state, picking a market, and building a team remotely.
Why did Sarah Weaver start investing out of state?
-Sarah Weaver started investing out of state because she couldn't find properties that cash flowed in her home market of San Francisco Bay Area due to high home prices.
How far away did Sarah Weaver buy her first property when she moved to New Zealand?
-Sarah Weaver bought properties in Nebraska when she moved to New Zealand, which is approximately 8,000 miles away.
What is Sulway's experience with investing out of state?
-Sulway started investing out of state by buying properties 900 miles away and later scaled up to owning 19 units in four states.
What metrics does Sarah use to pick a real estate market?
-Sarah uses metrics such as population growth, job growth, wage and income growth, rent rate increase, and home value increase to pick a real estate market.
What is Sulway's strategy for finding deals in real estate?
-Sulway relies heavily on investor-friendly agents for finding deals, with 75% of her portfolio coming from such agents, half of which were off-market deals.
How did Sulway expand her agent network?
-Sulway expanded her agent network by scouring the internet for investor-friendly agents, networking on forums like BiggerPockets, and building relationships with experienced investors who could recommend agents.
What is the importance of having an on-the-ground team when investing out of state?
-Having an on-the-ground team is crucial for managing properties, ensuring they are well taken care of, and for alleviating the fear and anxiety associated with investing in a market far away.
What advice does Sarah give to those interested in investing out of state?
-Sarah advises not to wait until everything is figured out to get started and to function in the fear, taking action despite the potential for feeling scared.
What is Sulway's biggest piece of advice for people looking to start investing out of state?
-Sulway's advice is to not wait until feeling completely ready and to start taking steps towards investing out of state, even if it feels scary.
How did the speakers manage to invest in real estate while traveling?
-The speakers managed to invest in real estate while traveling by creating processes and systems that work for them, allowing them to invest out of state and maintain their properties remotely.
Outlines
🏘️ Investing in Out-of-State Properties
Sarah Weaver and Sulway discuss their experiences investing in rental properties from a distance. They share how they made the transition to out-of-state investing, offering tips and tricks on selecting a market and building a team remotely. Both investors emphasize the importance of analyzing market trends such as population growth, job growth, wage and income growth, rent rate increase, and home value appreciation. They also highlight the role of investor-friendly agents in finding deals and building a reliable on-the-ground team, which is crucial for managing properties from afar.
🔍 Strategies for Finding Real Estate Deals
The speakers delve into their strategies for finding real estate deals, with a significant portion of their portfolio coming from investor-friendly agents, both on and off the market. They discuss the importance of building a network of reliable professionals, including agents, property managers, and contractors, through online forums and personal referrals. The summary also touches on the value of direct-to-seller marketing for expanding deal flow and emphasizes the necessity of taking action despite fear and uncertainty when investing out of state.
🎵 Embracing the Journey of Fear in Real Estate Investment
This paragraph, marked by the presence of music, seems to be a conclusion or transitional segment in the video script, possibly featuring a motivational or reflective message about embracing the journey of fear in real estate investment. It may include an applause or a musical interlude, indicating a pause or a shift in the presentation's tone. The exact content is not provided, but it likely serves to inspire viewers to take action in their own real estate endeavors.
Mindmap
Keywords
💡Out-of-state investing
💡Cash flow
💡Investor-friendly agents
💡MLS (Multiple Listing Service)
💡Off-market deals
💡Population growth
💡Job growth
💡Wage and income growth
💡Rent rate increase
💡Home value increase
💡Industry diversification
💡Competitive advantage
💡Direct to seller marketing
💡Referrals
💡Functioning in fear
Highlights
Sarah and Sulway share their experiences investing in out-of-state properties while traveling full-time.
Sarah discusses the decision to invest out of state due to high home prices in the San Francisco Bay Area.
Sulway explains how they scaled their investment quickly, from three to 15 units in 90 days.
The importance of having an investor-friendly agent in finding deals in new markets.
Sarah's criteria for picking investment markets include population, job, wage growth, and rent rate increase.
Sulway prioritized cash flow over appreciation when choosing Cincinnati for investment.
The value of industry diversification in ensuring a healthy tenant demand.
Sarah emphasizes the personal aspect of picking a market and the importance of taking action despite analysis paralysis.
Sulway's advice on leveraging competitive advantages, such as personal connections or local knowledge, in new markets.
The significance of deal flow and how to secure it through investor-friendly agents.
Sarah and Sulway's reliance on agents for the majority of their property deals, both on and off the MLS.
Sulway's diversification into direct-to-seller marketing to increase deal flow and find better discounts.
Building a strong on-the-ground team through referrals from experienced investors in the market.
The importance of referrals in growing one's network and overcoming the fear of out-of-state investing.
Sarah's advice on not waiting for perfect conditions but taking action despite fear.
Sulway's encouragement to function in fear and start the investment process without feeling completely ready.
The journey of scaling from owning no properties to multiple units across states over time.
Sarah and Sulway's lifestyle of traveling the world while managing their rental properties.
Transcripts
do you live in an expensive market or
want to travel full-time but you also
want to own cash flowing rentals in this
video we'll show you how we made the
jump to investing out of state and share
tips and tricks on picking a market and
building a team from thousands of miles
away
i'm sarah weaver and i'm sulway and
we're in guatemala
today we're going to be going over why
and how we invest long distance and we
mean long distance yes i bought my
properties from 2500 miles away what
about you sarah i started out small i
bought from 900 miles away and then when
i moved to new zealand i bought
properties in nebraska making that 8 000
miles away and today we're going to show
you how we did it that is so awesome
sarah i cannot wait to hear more about
it but as always make sure to like and
subscribe to this channel for more
videos like this and follow us on
instagram at lattes melisa's and sarah d
weaver if you stay to the very end we'll
be sharing our biggest pieces of advice
for people who are looking to start
investing at a state as well
absolutely and solely with interest
rates the way that they are rising so
quickly i'm getting asked more than ever
sarah how do you invest out of state me
too so i'm from san francisco bay area
where home prices are typically over a
million dollars and when i started
investing at 22 i didn't have the
capital or income to qualify for a house
that price
i decided that it made more sense for me
to look at a state where the prices were
a little bit lower and the cash flow was
a lot better i was in the same boat i
was living in denver colorado and at my
price point i couldn't find anything
that cash flowed so i bought my first
property from 10 hours away in kansas
city
and you scaled really quickly after that
first property right you know what's
really interesting is actually didn't i
bought that property
two years later bought another property
but then in spring of 2021 that is when
i scaled really quickly i went from
three units to 15 units in 90 days and
now i own 19 units in four states or
states why so many
you know it's interesting i didn't
intend on owning in four states it just
kind of happened that way i met an
investor friendly agent in a market that
i wasn't investing in and next thing i
knew i owned in that market and then i
did it again in des moines and so that
wasn't my intention but it is the
investor friendly agent that led me to
my market what about you i scaled fairly
quickly i went from
no properties to 27 units within two
years mostly through
investor friendly agents as well so i
chose to invest in cincinnati because i
had a small network of investors who
were able to introduce me to their team
and that gave me a lot of the confidence
when i was buying my first deal out of
state and on that note let's go ahead
and let's dive into the good stuff today
we want to talk about how we picked our
market but then more importantly how we
find amazing deals in that market even
from so far away and i know that we
credit a lot of our success to the on
the ground teams so we'll also cover how
we build those
let's start with picking a market sarah
how did you settle on yours you know i
have these certain metrics so i'll start
with those i have population growth i
want to see that population is
increasing more people are moving there
i want to see that there's job growth
that there's more jobs in that market
for those people moving there then i
want to see wage and income growth
because i want to see that they're
getting paid more so that i can increase
rent and that's my other metric is rent
rate increase i want to see that other
landlords are charging more in rent so
that i can do the same thing and then
last but not least is home value
increase i want to see that home are
increasing i mean we are investing right
and so i want my homes to appreciate and
so solely that's one of my questions for
you is
when you invested outside of california
i mean california is one of the most
appreciating markets ever and so why did
you choose cincinnati so i was actually
prioritizing cash flow over appreciation
and that's why i decided to look out of
state instead of investing locally in
california
me too that's excellent any other
metrics that you use
yeah so all those metrics are great i
look at them as well the one thing i'd
add is industry diversification so when
i'm looking for
a market i'm looking for one that has
multiple industries so not just a an
army base or one single hospital or
factory so that if that shut down you
would lose all of your tenant demand so
making sure you have multiple industries
that support a healthy tenant demand
you're absolutely right and here's the
thing solely and i we can sit on the
screen and we can say these are the
metrics that we look at but at the end
of the day you you have to just pick a
market you could
go into analysis paralysis googling best
market for this and best market for that
but at the end of the day you just have
to pick something do you agree
i totally agree picking market is very
personal as well so what i like to look
for is competitive advantage i had a
competitive advantage in cincinnati
because i had a network of investors who
were willing to introduce me to their
team and so whether you went to school
somewhere and you know the market really
well or you have a sister or friend
who's a property manager and can
introduce you to some parts of the
market or look after your properties i
think that's actually a great place to
start to start to narrow down the
markets that you're looking at i love it
because even if you have the best market
the next step is do you have deal flow
that's a great point sarah that brings
us right into the next portion of
today's show how we find deals so i know
you're getting great deals in your inbox
daily where are most of those coming
from
i rely really heavily on investor
friendly agents it turns out 75 of my
portfolio was actually brought to me
from an investor friendly agent and of
that 50 of that was on the mls and half
of that was what we call off market
deals what about you solely where are
you finding deals
it's funny because my percentages are
probably very similar 75 from agents 50
off market and 50 on market which a lot
of people think you can't find good
deals these days i've been diversifying
recently a little bit to just direct to
seller marketing so
mailers cold calls a little bit of
facebook marketing which i call direct
to seller and although it takes a little
bit more work you usually find a little
steeper discounts and so i like to just
increase my deal flow by adding in those
marketing avenues as well so since
you've been finding most of your deals
through agents what have you found to be
the best way to grow your agent network
absolutely and keep in mind you guys i'm
growing my my network or on the ground
team from far away i'm still not flying
to this market and so i go to the
internet and i scoured the internet for
investor friendly agents i started in
the bigger pockets forums
networking with other experienced
investors and building relationships
with them asking them who they recommend
to use and then i don't stop there i ask
for
agents property managers contractors
general contractors cleaners
photographers and a lot more i
definitely agree on the referral front
especially from experienced investors in
the market that's how i've built the
majority of my team so one of my
favorite sayings is rockstars no rock
stars and so once you find that first
solid team member usually people start
with investor friendly agents because
they're well marketed your referral lab
just definitely begins to grow once you
find that solid team it takes a lot of
the fear and anxiety out of out of state
investing because you know that there
are solid people looking after your
properties for you
absolutely i couldn't agree more
referrals are so important and for those
of that are interested in investing out
of state solely what's one of your
biggest pieces of advice i would say
don't wait until you got everything
figured out to get started i know i
definitely did not know what i was doing
at first at all but i quickly became a
problem solver and just put one foot in
front of the next you're never going to
feel 100 ready to take that leap so at
some point you just got to do it oh i
couldn't agree more and absolutely
slowly you're one of the best problem
solvers that i know
my advice is really similar i call it
function in the fear
for some investing can be scary and then
investing out of state can be even
scarier and i just tell people with
kindness just do it anyway so function
in the fear because i can't tell you i
get so many messages solely that are
like sarah you're so lucky you get to
travel how do you do it and i really
want to write back i buy a plane ticket
and then i get messages that are like
wow you're so lucky you own so many
rental properties how did you do it and
i want to say i bought rental properties
and so my advice is even if you're
scared do it anyway while investing out
of states can be scary for some of you
i'm hoping that hearing how sully and i
function in the fear create processes
and systems that work for us you now
have the confidence to invest in
out-of-state as well
and remember we didn't start out with 20
units it took time to get here to work
to build those processes but it all
started with a decision to take action
so through our real estate investments
we're able to travel full-time if we
want to sarah has been doing it for
three and a half years and i just
started thanks for joining us today and
follow us along on instagram to see how
we travel the world and invest out of
state
[Applause]
[Music]
you
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