out of state investment property – Page 6

January 11, 2016May 29, 2021

Why Buy Out of State Investment Property?

If you are an investor or possible investor in California, you probably know the answer to that question! Many of my out of state investors in California cannot believe the sky high cost of investment properties in many of the high population areas of California, such as San Francisco, Los Angeles and San Diego. Great places to live, but for positive cash flow investing? Not so much! California investment property is very expensive.

san fran — I feel for San Francisco real estate investors.

I’ve been fortunate enough to build my large portfolio of under market value properties here in Texas, where property values are a lot lower than some places. San Antonio investment property produces excellent real estate cash flow and is quite inexpensive. I also only owner finance my houses, so I have no maintenance costs.

If you are thinking about buying an out of state investment property for passive income, here is a good simple guide that can help:

How to Select Your Out of State Investing Market for Passive Income

Where you are going to invest in under market value properties depends on your real estate investing goals. Are you a flipper or a buy and hold investor? If you hang around my site long, you’ll learn I retired early with buy and hold investment properties that are owner financed. I’m a big believer in buy and hold long term cash flow – that is how I financially retired at just 28 in San Antonio – one of the best cities to invest in real estate, in my humble opinion.

Anyway, a good buy and hold market for passive income might not be the best flipping market. Here in San Antonio TX, flipping has gotten tough as the economy is booming as of January 2016; it’s hard for flippers to get properties cheap enough to make a good profit. For buy and hold investing though, I still make 10-12% per year, or $500-$700 per month in positive cash flow.

I’m biased, but TX is a great place for out of state investors – the population is soaring due to job growth.

As you think about where to buy out of state investment property and under market value properties, consider:

State law: Is the state friendly to property owners? You want to invest in a state that makes it easy to evict tenants or to foreclose. State that are tenant friendly, such as CA, make it so hard to evict or foreclose, you could lose your shirt.
Trends: What’s going on in the state as far as population? Here in Texas, we are seeing MEGA population growth. My market of San Antonio is #5 on the list above as far as hottest housing markets go. Jobs are the biggest reason that people are coming to Texas, as well as housing affordability. This makes Texas a great place for out of state investors.
Price to rent: What does rent cost compared to the price to buy? In my town, it’s 16.90, while in San Francisco it’s 30.05. Whoa! No wonder so many CA investors are investing in out of state investment properties.

These are not all the factors to consider when you are buying an out of state investment property instead of California investment property, but if those three areas look favorable, you probably could do well in that market and financially retire early as I did, in one of the best cities to invest in real estate. San Antonio investment property is excellent for cash flow.

How To Find Out Of State Investment Properties and Under Market Value Properties

Now that you know which market to buy your below market value investment properties, how are you going to locate that house? Most investors I know do it two ways:

They find a good real estate agent investor who is hooked up with excellent contractors, property inspectors, title company, real estate attorneys.
They find a good turnkey property provider. The house has been totally rehabbed and usually has tenants or buyers in place.

Which of these routes you go with will depend upon your investing goals again. Some out of state property investors want to have absolutely no headaches or management worries, so they just buy turnkey properties. Other out of state investors think that method is too expensive, so they manage their own rehabs and property management.

If you decide to find your own below market value properties in your chosen market, here’s what you’re looking at:

Buying Below Market Property Yourself

Advantages

You’ll get the house at a low price
High cap rate or ROI

Disadvantages

The house will not be producing income during the rehab and the time it takes to find a renter or an owner finance buyer
Rehab costs could shoot up if you don’t have reliable partners
Harder to manage the rehab and management from a distance
Difficulty in controlling material costs

Buying Turnkey Property

Advantages

Totally rehabbed
Tenant or buyer may already be in place
No work for you
Cost of material more predictable and stable
You know the quality of work you will get
Whole investment team is in place

Disadvantages

Higher initial cost
Lower ROI or cap rate

How big a difference are we looking at between buying a run down under market value house and buying a turnkey? Let’s take a look:

Run down property: Estate sale, $30k purchase, $30k in rehab – will produce 13% ROI with owner financing or renting.
Turnkey property: $80k purchase price, no repairs, will produce 9-10% ROI with owner financing or renting.

So which will it be? Most people would say you obviously go for the better ROI with the under market value property you do yourself. But remember, you are going to have to do a heck of a lot more work – at a distance – with the fixer upper property. A turnkey property will earn lower ROI, but it a lot less stress. At the very least, you might consider a good turnkey property if you are a beginner in real estate investing. That way, you can make some good positive cash flow as you develop your own investment property team.

It all boils down to how you look at investing in real estate. Investing by definition means using something to get some type of return. You just have to decide if you want to use just your money to get a return, or use your time AND money to get a potentially higher return.

Choose wisely based upon your personal investing goals, and you will hopefully be able to be financially retired on your time table.

Personally, if I were a usual buyer of California investment property, San Francisco investment property, Los Angeles investment property or San Diego investment property, I would strongly consider buying out of state investment property. Investment property is all about real estate cash flow…..it’s something you can rely on year in and year out, unlike hoping for appreciation.

January 10, 2016May 6, 2021

Do You Have a $200,000 Salary and Hate Your Life? Buy Under Market Value Properties

I can’t tell you how many people I run into in my under market value properties career who have good jobs and hate their lives.

That is, they make $200,000 or more per year and yet, they work 60 hours per week, sit in dull cubicles for years and years, and wish they had the time to do what they want to do.

The truth is, most of us have been conned into thinking that the ONLY way to live in America is to trade time for money.

Passive income is the way to go – with under market value properties – at least 20% below market value. Who wants to sit bored in a cubicle or office for most of their working life? It’s a form of slavery, even if you are well paid.

But a guy or gal like you…..you make $200,000 per year or more out there in California or Washington….you most likely have some capital stored up so that you can buy under market value investment properties, and STOP trading your time for money. This type of out of state investment property is perfect for you. Passive income fast.

Here is a quick plan to stop trading your time for money TODAY. I am going to assume you have some capital to work with (if you don’t, go find some private investors to borrow money from.

If you live in a high cost area, strongly consider buying an out of state investment property.

This under market value investment property is one that I have scouted out carefully in a very hot part of 78201, which is north of down town San Antonio. It is seeing a lot of young professionals moving in and property values are shooting up. There is a good chance you could get a young professional buying this under market value property from you, or a hardworking blue collar family:

Address: 2229 W Hermosa Dr. San Antonio, TX 78201
Year Built: 1948
Description: Distressed property sale, 2 beds 1 bath, 769 sqft, lot size: .14 acres yearly taxes: estimated repairs: 35K (convert to 3 BR).
Max After Repair Value: $129,000.00.
Cash Price: $69,900 firm.
Exit Strategy: Owner finance 10% interest rate, $5000 down, 30 year note, $1100 per month PITI. Plenty of positive cash flow.
10% ROI no maintenance.

Here’s how you can retire early in one of the best cities to invest in real estate – Buy under market value properties just like these with cash or with borrowed cash. I do $35,000 in rehab. Then resell the house with owner financing to a qualified buyer. Simple!

The above out of state investment property will make you $1000-1100 per month, assuming you fund the deal with cash from your $200,000 or whatever job. In time you will be able to financially retire.

That’s it. Buy, rehab, resell, and collect the cash flow. It IS that simple. Lather, rinse and repeat.

January 8, 2016May 29, 2021

What Should You Not Do When Buying Under Market Value Property?

Many real estate investors with out of state investment property flame out quickly when they buy under market value properties. That’s because they make huge mistakes that either mean they make no money or they lose money.

The things that you should not do when you buy below market value property for real estate cash flow include:

Not doing your research. You don’t usually buy a car without doing a lot of research, right? The due diligence you do when you buy an under market value house should be even more rigorous. When I buy the best San Antonio investment property, I do my research about the neighborhood down to the street level. I also do a thorough inspection of the property before I make an offer. This is one reason you might consider becoming a real estate agent, as I am. That way you can search for your own deals in the MLS and view the houses yourself.

Doing it all yourself. I’ve been doing real estate investing in below market value properties for 15 years, but I don’t try to do everything myself. I have on my team a good inspector, full construction crew, real estate attorney, CPA, insurance professional and closer. I have seen many investors buy a house on their own and they end up with losing their investment.

Paying too much. This of course will turn your under market value property investment into a real mess. Finding a good house to invest in takes time, so it is tempting to make a high offer that will be accepted quickly. Overbidding means that you will have too much debt, if you are buying with financing. This creates big problems when repairs and vacancies crop up.

Spending too much on rehab. A classic mistake of the under market value property investor is to spend too much on fixing the property. I have been investing in San Antonio distressed houses for 15 years, and I know how much rehab to do on a house to resell it. If it’s in say 78207, I may do 15-20k in rehab, but I know I probably can skip the granite in the kitchen. If I am rehabbing in a higher end area such as 78201, I will do the granite and fancy back splash in the kitchen. Also, I have a construction company that allows me to save 30% or more on rehabs compared to retail contractors.

Making money in under market value properties for real estate cash flow isn’t easy, but it is doable with proper planning and research. If you have any questions about investing in the best San Antonio investment property, please contact us.

When you are considering below market value property or out of state investment property, please try to avoid the above mistakes!

January 6, 2016May 29, 2021

Should I Become a Real Estate Agent as an Investor?

Investing in under market value properties in San Antonio, Texas has provided me with a fantastic, long term passive income. Before the real estate downturn of 2007-9, I was not a real estate agent, and I relied on several investor friendly agents to show me potential under market value distressed properties in San Antonio TX.

After the crash, many real estate agents got out of the real estate business . I discovered that finding a good, long term real estate agent was harder than before to buy below market value property.

It was in 2010 that I made a fateful decision: I became a real estate agent and investor myself, and it has been a great decision for me. It has made it easier for me to buy under market value properties in San Antonio TX.

Being a licensed Texas real estate agent can help you to build property cash flow over time. Currently I own more than 50 owner financed investment properties in San Antonio TX. On most, I am making at least 10% return, which means I have cash flow of $500 to $800 per property. Most of them I own in cash.

Whenever I buy another distressed real estate property for buy and hold, I am able to save at least $1000 on real estate commissions. If I buy 40 houses a year, that’s more than $40,000! What a deal!

If you are buying more than 1-2 below market value properties per year, I think it is a good idea to go ahead and get your real estate license. If you do absolutely nothing else with it, your real estate license will save you majorly on commissions.

On many of my deals, I as the real estate investor agent buy the under market value property, fix it, and then resell it with owner financing. I am able to save TWO real estate commissions on these deals, which in some cases saves me $5000 or more!

Advantages of Being a Texas Real Estate Investor and Real Estate Agent

A real estate investor agent can save on real estate commissions for below market value properties, as I illustrated above.
You have access to your area’s MLS and can do your own due diligence on potential investment properties. Having MLS access saves you time, and allows you to get offers in before other investors.
As a real estate agent investor, you will be able to network with other agents, who certainly know people who want to invest, or may be investors themselves. I often buy unlisted properties because of my contacts with other agents in San Antonio TX.
You can do your own BPOs or Broker Price Opinions. This is a 1-3 page report that a licensed real estate agent can do, for a payment of $50-100. This is a great way to earn extra cash flow as you are getting started in real estate investing.
You also can sell retail properties to supplement your income, which has really come in handy for me several times each year as a real estate agent investor. Nothing like earning another $20,000 per year!

Clearly, the advantages of being a real estate agent investor are many for getting texas cash flow. I believe becoming an agent is really worth it if you buy several under market value investment properties annually. I also have found that being a real estate agent investor makes it easier to work with investors looking for a good out of state investment property.

January 6, 2016May 29, 2021

What Is the Worst Mistake in Buying Investment Properties?

I buy under market value properties in San Antonio TX. As the real estate market continues to heat up in San Antonio, more people are jumping into the real estate investment business.

Many people who start to invest in under market value investment property in San Antonio end up never making money or losing a lot of money. That goes the same for people looking for out of state investment property.

Most often, people run into real estate investment problems because they are impatient or do not have a good, long term plan for good cash flow on below market value property.

I have been successful with my San Antonio investment properties (I financially retired at 28) because I have a very simple plan that I always stick to:

I buy distressed San Antonio homes for 20% or more under market value, and resell them with owner or seller financing to make a 20% return long term. The vast majority of my portfolio is long term buy and hold in the best San Antonio investment property.

Of course, buying good distressed properties under market value in San Antonio is not easy. If it were, everyone would be buying them and retiring early!

Here is the most common mistake I see by far in people who buy distressed real estate properties and out of state investment property: They pay too much for the house and have very little cash flow!

They buy the house often at the top of the market, and the only way they make cash flow each month is if the property is always occupied, and there are no maintenance issues.

As soon as something goes amiss, they end up losing money each month and have no cash flow in their under market value San Antonio investment properties.

The biggest piece of advice I can give you is to always pay as little as possible for the investment property in the best cities to invest in real estate. If you are not skilled in negotiation or are just a beginner, you need to work with a skilled investor who can help you to get a low price on that below market value house.

If you have questions about investing for cash flow in under market value San Antonio houses, please contact me! I always can use cash partners and both of us will make a good profit in the best San Antonio investment property.

November 19, 2015January 30, 2016

SOLD OWNER FINANCE – 1609 W Travis St, San Antonio, Texas 78207

Address: 1609 W Travis St, San Antonio, Texas 78207
Year Built: 1950
Description: Booming San Antonio Market out of state investment property, very popular location west of downtown, 1609 W Travis St, San Antonio, Texas 78207-3567, 3 beds, 1 bath, 1100 sqft, estimated repairs: 38K, includes paint in/out, new HVAC, flooring, foundation, update kitchen/bath, etc.
Max After Repair Value: $89,900
Cash Price: $35,000 firm.
Exit Strategy: Owner Finance with 35K repairs: 5-10k down, $895 monthly P/I, 30 year amortization, 10% interest, Price: 89.9K, can sell note after 1 year; or rent: $900 monthly with 38K in repairs.
Notes: We recommend that you owner finance this out of state investment property because you will have no maintenance expenses. ROI will be ~10%.
Contact us for more information or to make offer.
Sold and Rental Comps: Rental Comps 1609 W Travis Sold Comps 1609 W Travis St

More Pictures:

November 19, 2015January 14, 2016

3 ways to stay positive in the midst of a storm

Key Takeaways

Listening to positive and inspiring people keeps your spirits up in rough times.
Staying positive can lead to new business opportunities.
Stay away from negative real estate investors especially online forums.

This article now appears in Inman Select.

Maintaining a positive attitude in San Antonio investment properties has been key to my long-term success since 2001. My mentors taught me that staying relentlessly positive in my investing would propel me through rough waters.

And have I ever been through some rough Class-4 rapids in my day.

But let’s back up for a second. Before the real estate crash of 2008, I focused largely on $1 million homes in San Antonio, Texas, which I rehabbed and resold for a 30 percent profit. Those were the days — rehab a house in four months and sell it for a $325,000 profit.
Learn from tough times

Then one morning in 2008, I called my local bank to borrow an additional $250,000 for two rehabs. The voice on the other end of the phone said, sorry — we aren’t loaning money on under market value San Antonio investment properties anymore.

What? And that was when it all started to fall apart. It was nearly impossible to borrow money, though I owned 100 houses free and clear and had an eight-year success record.

But I had a bigger problem. I was stuck with $1 million worth of under market value houses that I couldn’t sell. No one could qualify for mortgages, and the market crash had dropped their value to under $800,000.

I had many sleepless nights. Despair crept up on me as my bank account shrank.
Focus on positive speakers

Even though I was losing money left and right at this time, I still managed to keep a positive, can-do attitude with my out of state investment properties.

That’s easy to say, but how did I do it? I listened every day to positive speeches and sermons from famous speakers and pastors.

Being a Christian, I listened every day to Joel Osteen; I found his uplifting sermons about prosperity in all aspects of life to be a huge lift for me.

Also, I listened daily to the leader of Christian Business Leaders International, Bob Harrison, who is also known as the No. 1 increase authority in America.

Harrison has been through trying financial times as well. But his optimism has carried him through, and he is now one of the leading business speakers in the world.
Lead with optimism and find new opportunities

Maintaining an optimistic outlook didn’t just get me through the market crash. It also opened new horizons for me in real estate investing.

I discovered something shocking: the expensive $1-million houses are the riskiest investments. When the market dips, the demand for those homes plummets, as do the prices.

On the other hand, my little, bitty $50,000 three-bedroom, one-bathroom out of state investment property sells just the same no matter what’s happening in the market.

The demand was always there for these small under-market-value houses, and each one made — and continues to make — me $600 to $800 per month on owner financing.

So, the crash and staying positive throughout it led me to an amazing new business opportunity — buying and selling distressed homes and owner-financing them. Even better, the crash allowed me to snatch up 100 of these houses for about $20,000 each, and they now sell for $50,000 each or more.
The crash and staying positive throughout it led me to an amazing new business opportunity.
3 tips for staying positive

It’s vital to maintain a positive, can-do spirit in your real estate investing, no matter what. This is what makes you stick to it when other investors give up. Here’s my advice:

1. When things are bad, listen to uplifting and motivational speakers

Find positive business mentors online that can inspire you and keep you motivated. Zig Ziglar is another great one.

2. Remove yourself from negative environments, especially online forums

I love the Internet, but there is a lot of negativity on some real estate investing websites. Many people just want to moan about how bad things are — it makes them feel better.

I don’t have even one second of time for this kind of talk. Associate with positive, can-do real estate investors only. And by the way, I made plenty of money in real estate without a website or ever being online at all.

3. Shadow a successful, positive mentor

Whatever city you are in, you can locate a good real estate mentor to inspire you. Why would he or she talk to you? Because you have something to offer.

Offer to help them with hanging signs, making calls or doing office work in exchange for learning from them. I met most of my mentors at real estate meetings in San Antonio, and their positive attitude rubbed off on me.

Maintaining an optimistic outlook in down times led me to even better real estate success in under market value properties, so always keep your chin up.

October 31, 2015May 26, 2021

How To Retire Young With Under Market Value Properties

Hello investors and ‘maybe’ investors! Thanks for visiting my little website about under market value properties in San Antonio TX. It is these little bitty affordable homes that allowed many people to retire young. You can, too!

#1 I Discovered an Inexpensive, Stable Real Estate Market

Before investing in San Antonio, many of our investment property investors considered Austin, but that’s an expensive market, even years ago. But San Antonios is only an hour south and is a great market for owner financing.

During the market crash of 2008-9, the prices of these homes dropped, and and many investors were able to pick up a dozen at 50% under market value. That also helped to grow our investors’ real estate portfolio.

Lesson Learned: Steer clear of real estate markets with high entry costs. Lower cost cities are much easier for investors with limited capital.

#2 We Found Reasonably Priced Private Money

After you get your first house or two, you may not have any more cash. But where should you look? One way to do it is to just make phone calls looking for private money. Another is to go to investor meetings and get to know people with money.

Eventually, through all phone calls and networking meetings, some investors found people willing to loan money at reasonable interest rates. When you can find that source, it makes everything a lot easier. However, you also can borrow money from your own home or IRA, if you have a good under market value deal and keep the rehab reasonable.

Note – many of us prefer to invest all cash, but there ARE other options. You can, for example, buy nicer houses for $75,000 or so and do 20% down conventional finance, and then owner finance them. Cash flow is ~$300-400 per month with no maintenance.

: Be prepared to do a lot of work and make a lot of phone calls to find private money. It’s easiest of course if you have family willing to loan you money on reasonable terms. If not, get on the phone, and go to real estate meetings every week.

#3 Become A Real Estate Market Expert In Your City

One of the keys to success is to buy houses many other investors run screaming from! You can buy houses that don’t look that great, do some minor rehab, and owner finance the investment property to a willing buyer.

Other investors early in their careers rehabbed homes themselves and got to know the market in the city. This helps you get a great idea of what homes in many parts of San Antonio are worth. Then, you know how much a San Antonio fixer upper needs in rehab and what to spend without overspending.

You also can earn your real estate license, and spend many hours studying prices of houses. One of the most important parts of being a successful investor is getting a house at least at 20% under market value.

Lesson Learned: Study your local market so you can buy houses under market value. Can’t find those kinds of deals? Consider working with an expert real estate investor in your market who can help you find those deals! Offer to help him or her with their business in exchange for turning you on to good, under market value deals.

#4 Find Good Real Estate Mentors

Getting started in real estate without successful mentors is like going fishing without fishing tackle! Every beginner real estate investor should work with very successful and experienced mentors. You can find mentors at real estate meetings in San Antonio and also at real estate conferences in other cities.

Lesson Learned: Find mentors and real estate partners who have done several hundred deals and have done well in both boom and bust markets. Working alone in real estate as a rookie is a recipe for disaster.

#5 Invest in Cash, for Cash Flow Only – With Owner Financed Real Estate

One of the most important lessons some of use learned from our mentors is to owner finance many properties instead of rent them out.

Under the advice of our mentors, we stopped rehabbing and renting out houses. In many cases, we used an owner finance model only.

Today, we buy a San Antonio investment property for cash for about $50,000 or $60,000, do $10000 in rehab, and then resell the property with owner financing to a qualified buyer. There are no overhead costs or property management costs associated with this exit strategy.

(You CAN do owner finance with conventional financing, 20% down, and still earn $300-$400 per month in cash flow.)

Lesson Learned: Consider investing strategies other than renting out property. Owner financing houses is less stressful and is clearer cut in terms of monthly cash flow.

Want to learn more how to do make real estate cash flow on San Antonio investment property? Contact me at jmpickett@gmail.com.

And remember, most of our out of state investment property investors used to buy California investment property, San Diego investment property, San Francisco investment property, and Los Angeles investment property. Here in San Antonio, they usually make 12-15% ROI for great real estate cash flow – without maintenance costs.

October 31, 2015January 30, 2016

SOLD – 1740 Edison Dr . San Antonio, TX 78201

Address: 1740 Edison Dr . San Antonio, TX 78201
Year Built: 1918
Description: Out of state investment property with 3 beds 2 bath, 1040 sqft, built: 1918, lot size: .14 acres yearly taxes: $2,000.00, estimated yearly insurance: $800.00, estimated repairs: 30-35K, includes new HVAC, interior monterrey finish, paint in/out, outdoor storage unit, appliances, trash, lawn maintenance. 20% below market value.
Max After Repair Value: $139,000-$145,000 with owner financing on this out of state investment property.
Cash Price: $80,000 firm.
Exit Strategy: Owner Finance with 25K repairs: 5-10k down or more, $1,295.00 monthly P/I, 30 year amortization, 10% interest. Excellent cash flow, below market value property.
Notes: We recommend that you owner finance this out of state investment property because you will have no maintenance expenses. ROI will be ~10%.
Contact us for more information or to make offer.
Sold and Rental Comps: Sold Comps 1740 Edison Dr Rental Comps 1740 Edison

More Pictures:

Please contact us to make offer or ask questions.

October 31, 2015January 6, 2017

SOLD – 2229 W Hermosa Dr. San Antonio, TX 78201

Address: 2229 W Hermosa Dr. San Antonio, TX 78201
Year Built: 1948
Description: Under market value property sale in hot north of downtown neighborhood, 2 beds 1 bath, 769 sqft, built: 1948, lot size: .14 acres yearly taxes: $1,200.00, estimated yearly insurance: $800.00, estimated repairs on this distressed sale.
Rehab Option#1: Buy and rent with 15k in rehab, includes interior paint, flooring, roof leak, and appliances.
Max ARV: $114k to $119k.
Rehab Option #2: Buy and owner finance with 22k in rehab, ARV is $114k-$119k
Rehab Option #3: Buy and do 10k in rehab, and owner finance $99k, $995 per month, 5k down, 10 percent interest.
Cash Price: $69,000 firm.
Contact us for more information or to make offer.
Sold and Rental Comps: Sold Comps 1740 Edison Dr Rental Comps 1740 Edison

More Images:

Please contact us to make offer or ask questions.