If you’re interested in real estate investing, chances are you’ve looked around your area for properties to purchase. Of course, you may be missing out on great real estate investing opportunities if you don’t look at other hot areas. Before you invest, you should decide if you want to put your dollars into the local economy or if you’d rather look into properties in another area. Here are a few pros and cons to help you decide which strategy is right for you:
● There’s less travel involved. Obviously, local investing means you’re not going to have to travel as far reach your property. Real estate investors who invest in other cities may find themselves traveling frequently to check up on their property, but keeping it local saves you both time and money.
● Local properties may be easier to manage. If you’re located in the same area as your investment, you can help out more easily when there are problems. From a water pipe bursting at an apartment complex to vandalism in a commercial area, issues are easier to resolve when you’re in town.
● It’s easier to do your homework. Finding out information about a property may be easier in person. Although the Internet has made it faster and easier to do research from afar, nothing beats being able to inspect the property yourself.
● You may be missing out on opportunities elsewhere. Unfortunately, investing locally may mean you’re losing out on a great investment somewhere else.
Investing Out of Town
● You’ll face increased travel time. Time spent in a car is something you can never regain. Consider how far you’d have to travel to reach your property before you make an investment in another city.
● You can work with a property manager. To make your non-local investment easier to manage, you may want to hire a manager or even a company to run the property for you. They’ll deal with the day-to-day issues of managing your property. Keep in mind that this can cost a significant amount of money, so it’s worth researching before you make a purchase.
● You might be able to make a better investment. If your local area is clogged with bad investments, looking outside your city may give you a chance to find a better property. If your local area doesn’t have any options and you’re itching to get into real estate, looking elsewhere may mean that you find the investment opportunity you’ve been dreaming of.
Real estate investors, especially first-time investors, should probably look in their area before searching farther away. Local investments are easier to manage for most real estate investors, and while it’s true that investing farther away may be a viable option once you’re more established, it can be a risky thing to do when you’re just starting out.