I've decide to get a jump on one of my goals for 2007 and am in the process of picking up a new rental property! This one will be out of state and I'll be using a property manager to manage it. The property is currently rented with a lease though November. I won't say anything else because there are no contracts yet, but I'm excited about the opportunity.
I hadn't planned on investing out of state mainly because I didn't want the headaches that can go along with out of state landlording. Instead, I had been concentrating on the filled lease option properties that some companies in the Phoenix area are selling. I don't want a negative cashflow property and the only way I could see to make those investments cash flow positive would be to put in $10,000 to $20,000 of my own money and, even then, the cash flow would be pretty small. So I was out driving one morning and had a small epiphany. I had seen some properties for sale in the Midwest a couple weeks ago. At the time, I had dismissed them in favor of going after the lease option deals, which I thought I could get into with less cash. But now that I was committed to putting more money into the investment, these properties suddenly seemed more attractive. They may not provide the appreciation that the Phoenix market might, but they would produce nice cashflow each month and the entry costs would be much lower. In fact, I may be able to get two properties instead of the one I'd get here in town!