You can still invest in real estate even if you don’t live in a good investment area. Just focus on an area that offers investment opportunities, a practice known as long-distance real estate investing.
There’s a little more involved with investing this way, but if you follow a formula, you should have just as good a chance at making money as you would investing in your hometown. Here’s how to make long-distance real estate investing work.
Learn all you can about the area
When you invest locally in rental property, you know from living nearby which areas to focus on: places where people want to live. The neighborhood is affordable, it’s close to jobs and/or public transportation, has a low crime rate, and the schools are good.
When you invest out of town, you can find out all this information by researching online. Once you’ve found an area that meets your qualifications, such as a booming city like Chattanooga TN and surrounding areas, for example, you’re ready for the next step.
Gather a team
To lower your risks when investing in long-distance real estate, you’ll need some help. It doesn’t matter how cheap you can get a property if no one wants to rent it. You’ll need a team to help you pick a potentially good rental property, like the Property Rush Team:
Property Rush Team Offers:
- Expert sales agents with expertise in the local market
- Skilled and qualified contractors with experience in rental property
- In-house property management with a highly qualified property manager
- True partner, Property Rush is with you every step of the way, even after closing
- Closing team that specializes in investors, offering lower rates, but high quality service
- Vendor partners who are ready to provide Property Rush clients top-notch service. Ask us about our lender and insurance referrals.
Run the numbers
The process now becomes just like it is when you invest locally. Run the numbers on various properties to determine which ones make sense. Find out whether you’ll have positive cash flow (rent income minus mortgage, taxes, insurance, repairs, and vacancies) and what the net operating income (NOI) and capitalization rate, or cap rate, are. NOI is rental income minus operating expenses (excluding the mortgage). Cap rate is NOI divided by the purchase price. A higher cap rate is good, but a high cap rate indicates a riskier investment. Property Rush will assist you with this process to determine which investment property best meets your needs. We only offer investment properties that we would be willing to purchase and hold for our own investment portfolio. You can be assured we are diligent in our process of purchasing investment properties that provide the best return for our clients.
Once you get one long-distance deal under your belt, you can use this formula to start building a portfolio of investments anywhere you like. And that is the way to build your fortune in long-distance real estate investing.
Would you like more information? We would be happy to jump on a call with you to discuss our program.