Investing Locally or Remotely: Which To Choose?

If investing in local real estate makes sense investing remotely makes even more; after all life is about expanding beyond your comfort zone.

To do so you’ll first have to look beyond your own immediate environment.

Why? Because great investment opportunities are never confined to your particular neighborhood, city, or state– especially when it comes to real estate! With so many opportunities spread across the U.S. why miss out on becoming a remote investor?

Sometimes The Grass Really Is Greener On the Other Side

It’s human nature to believe everything that’s best is nearby. Yes investing locally does mean that you’re already familiar with the area, can drive by the property, and take a hands-on approach to managing it.

However while this familiarity is comforting it doesn’t imply that the most profitable investments are confined to your neighborhood. It’s actually quite the opposite.

Our analysis of first-year returns—or cap rates—for single-family rental properties (SFRs) nationwide in 2016 highlighted the Midwest and Southeast as the U.S.’s most valuable markets; with Cleveland (Ohio), Columbia (S. Carolina), and Birmingham (Alabama) rounding out the top three.

What Remote Real Estate Investors Should Know

Expanding your investment locations goes a long way toward maximizing your returns while also mitigating your risk. Select markets throughout the U.S. are seeing record highs and others are producing solid cash flow.

Why?

Remember that the median household cost across the U.S. is typically a lot less than you’d find in ultra-coveted markets like California.

This means that you’re more likely to afford multiple investments when purchasing out of state properties. For instance the median home price in Irvine, CA is $769,000 while elsewhere they’re: $125,400 (Columbia, S.C.), $61,800 (Birmingham, AL), and $52,100 (Cleveland, Ohio, note: all prices according to Zillow).

As a result you could (potentially) buy 3 homes– one from each of the above markets– for the same price as one in Irvine.

Additionally vacancies are less impactful to your portfolio when you have multiple properties generating rent for you. This strategy of creating a portfolio of single-family rentals is called building a “virtual apartment.”

It means buying multiple single family rentals to create multiple streams of income (similar to the concept of owning an apartment building).

Since your SFRs are located across different markets the risk is less than if you owned a single apartment building in a single market.

Conclusion

Explorers would never have found new land if they had stayed home. Similarly, you may have to look beyond your surroundings to generate your wealth. Let’s explore the possibilities together.

Take your first step toward becoming a remote investor by calling 888-276-0232 today.

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