I’ve been questioned recently on the proper ways to invest out of state, in emerging markets as well as how we (and a few colleagues) established our residential investment base out in PA. Hopefully some of this info can be helpful to you.
The first step is to establish an area where you would like to invest. This completely depends on your own goals, comfort level, and your financial situation. A whole topic among itself, we’ll assume you are already interested in an area, or have identified it as an emerging market.
1. Establish key relationships in your new market! This includes everyone, from your realtors, contractors, property managers, leasing agents, tenants and buyers, to the local postmaster, the building department, the Dunkin Donuts cashier, the economic development office and other government officials. Every single person you meet will give you a better feel of your area, and will influence the amount of success you achieve.
2. Keeping your eyes on your goals, set up (and write down!!) a strategy to make the necessary financial returns you require from your investments. This could include choosing the type of property, such as single family homes, multis or commercial, and determining your exit strategy (buy & hold, lease options, quick turnovers, etc.). How will you find these properties? How much will you pay for them?
3. Identify who the key players will be, that will help you within your systems you set up in your target market. Who will assist you in acquiring property? Who will manage the property? Who will deal with the local code enforcement office, or the tax bureau? Who will help you determine the accurate ARV?
4. Contact those individuals, and set up these necessary relationships. Ask yourself – how is this a win-win? Take it from experience – you CANNOT do this all on your own! And if you are, then start looking at all the money you’re leaving on the table!
5. TAKE ACTION. Using your newfound relationships and systems, now is when you identify investment opportunities that meet your criteria, and execute on your strategies. You may have to tweak your systems as you go along. The important part is to take action: SHOOT FIRST, AIM LATER.
6. Continue to evaluate your market, identify opportunities, execute, and know when to move on. Whether your portfolio has grown large enough in that area, or you feel the market is about to change, you must recognize when it’s time to change your strategy, move to a new market, or liquidate altogether.
As you can imagine, there’s much more to it, but this is the bare bones. We at AA Real Estate take months of preparation in an area, gathering information, forming relationships, and setting up systems before we determine it’s a good place for investment.
Right now, we’ve identified and are invested in 4 markets, with a few others being researched.
If we can help you further your investment goals with our established systems and experience, please don’t hesitate to contact us. We’ve helped so many, and welcome many more on board with both our residential and commercial opportunities!
Lexington, KY: We still have a few slots available for accredited investors to jump in on the 222-unit deal, that’s already been closed. If you know of anyone who is interested in learning about multi-unit investing, here is a great starting point for them! Returns currently averaging from 60% to 94%.
PA: We have some end of year deals coming down the pipeline – returns ranging from 45% to 110%, you do NOT have to be accredited to participate in these deals!
We continue to update our website as well, so stay on the lookout! Contact us through our website at AA Real Estate Partners.
Until next time,
AA Real Estate Enterprises LLC
“The Service you Expect, with the Returns you Deserve.”by