Your Step-by-Step Guide to Out-of-State Investing That Actually Works

One of the biggest myths in real estate investing is that you need to invest close to home. But the truth? Some of the best deals aren’t in your backyard—they’re in markets you’ve never even visited.

Out-of-state investing has become more common than ever, especially as affordability tightens in major metros. From high cash flow rentals in the Midwest to value-add properties in growing Sunbelt cities, investors are building entire portfolios without ever boarding a plane.

But how do you actually do it without losing sleep—or money? Here’s a step-by-step guide to help you scout the right markets, build a reliable local team, and manage your properties with confidence from anywhere in the country.

Investors often make the mistake of chasing the cheapest markets, only to find themselves stuck with high vacancy rates, poor tenant quality, or stagnant appreciation.

A smarter approach is to look for markets with:

  • Job and population growth

  • Diverse industries (not dependent on one employer)

  • Landlord-friendly laws

  • Low entry price with solid rent-to-price ratios (ideally 0.8%–1% or higher)

  • A history of steady—not explosive—appreciation

For example, mid-size cities like Columbus, OH or Birmingham, AL have become investor favorites due to their affordability and strong rental demand. On the other end, areas just outside expensive metros (like the Inland Empire outside LA or Tacoma outside Seattle) offer room for growth with fewer barriers to entry.

📌 Use tools like City-Data, Roofstock Market Index, or Local Market Monitors to assess metrics like rent growth, crime rates, and employment shifts.

Your team on the ground is everything. They’re your eyes, ears, and problem-solvers when you're not there in person.

At minimum, your local team should include:

  • A realtor or broker who works with investors and understands rent comps

  • A property manager (PM) who knows the neighborhood and tenant pool

  • A contractor or handyman to evaluate repairs and execute the work

  • A lender who works with investment properties in that state (DSCR, conventional, or hard money)

  • A title company or real estate attorney, depending on local closing customs

Before making an offer, savvy investors will interview multiple property managers, request referrals from Facebook groups or BiggerPockets, and ask their PM to preview potential properties to offer feedback on rentability and condition.

📌 Red flag to avoid: hiring a PM who says “yes” to everything but can’t provide data or examples to back it up.

Numbers matter—but context matters more. It’s easy to be impressed by high cash-on-cash returns on paper, but without on-the-ground insight, those returns can quickly disappear. Smart out-of-state investors take a layered approach to due diligence:

  • Use tools like DealCheck, Rentometer, and Zillow Rental Manager for rent estimates and rehab calculators.

  • Zoom in with Google Street View to check the block. Look for pride of ownership, boarded-up homes, or signs of disrepair.

  • Call local property managers to confirm rent comps and get candid feedback on the tenant pool in that neighborhood.

  • Verify property taxes, insurance rates, and any local ordinances that could affect cash flow (especially for short-term rentals or duplexes).

Example: An investor might find a fourplex in a secondary market priced attractively, but after speaking with a local PM, learn that one of the units is nearly un-rentable due to its size or location next to a vacant lot.

📌 Always ask: “Would you invest in this property yourself if you were me?”

Once under contract, experienced investors rely on their team to inspect and verify the property’s condition before closing. This often includes:

  • Professional home inspection with a written report and photos

  • A walk-through by your property manager to assess what’s needed to make the unit rent-ready

  • Contractor estimates for any repairs or upgrades

Many investors request video walkthroughs or FaceTime calls during inspections. A good PM will document the property and flag any items that could delay leasing, such as old appliances, safety issues, or cosmetic updates that would make the unit more appealing.

📌 Tip: Establish a repair threshold with your PM—like $250—so you can approve anything higher before it’s done.

The key to managing remotely isn’t micromanagement—it’s creating repeatable systems.

Look for a property management company that:

  • Uses a tenant portal for maintenance and rent payments

  • Provides monthly owner statements and end-of-year summaries

  • Communicates consistently (ideally through email + owner portal)

  • Offers routine inspections with documentation

Investors who manage multiple rentals remotely often schedule monthly or quarterly check-ins with their PM to review rent colction, maintenance requests, and tenant turnover trends.

Even without flying in, you can keep a close eye on your investment by:

  • Reviewing repair invoices

  • Checking updated photos every 6–12 months

  • Watching market changes that may affect rent growth or expenses

Final Takeaway: Success Isn’t About Proximity—It’s About Process

Out-of-state investing isn’t about luck—it’s about being intentional, prepared, and strategic. When you treat your rental properties like a business, location becomes less important than execution.

The most successful remote investors:

  • Scout markets based on data, not emotion

  • Build local teams they trust

  • Lean on systems, not guesswork

  • Ask smart questions and verify everything

You don’t have to live next to your rental to profit from it—you just need the right people, the right process, and a clear investment plan.

Stephen Husted