Transcript:
Welcome to the Tax Sale Podcast, where tax sale investing is made easy. My name is Casey Denman, I’m a tax sale veteran, the leading tax sale expert, author of The Tax Sale Playbook, founder of The Tax Sale Academy and I’m your host right here on The Tax Sale Podcast.
Thank you so much for joining me on today’s podcast episode. This is a completely free podcast and is brought to you through and because of The Tax Sale Academy. If you’re looking to learn more about investing in tax defaulted real estate, just head to TaxSaleAcademy.com. Again that’s TaxSaleAcademy.com
On this week’s episode, we’ll be discussing long distance tax sale investing. If you’re not familiar with my background, I started investing locally and then expanded to another county, and another, then another state and another and another. I’ve invested in about a dozen states now and hundreds of different counties. The moment I expanded into other counties and eventually other states, is the moment my income starting to grow. I’ve discussed out of area investing in depth previously in episodes 112 and 114 of this podcast. If you haven’t yet had the chance to check those out, they’re definitely well worth the time.
In today’s episode, I wanted to go over a few extra tips to help make your out of area investing process much much smoother. It’s incredibly easy to get intimidated and overwhelmed when venturing into new areas, so hopefully these tips will make that process much easier.
Alright, let’s start. I’ve got 5 tips I want to discuss.
The first one is to become an online research expert. I can’t emphasize this enough. Research, as I’ve said a thousand times before, is everything in this business. Your investment is a direct reflection of your ability to accurately research a property. Do it right and you’ll make money. Do it wrong and you’ll lose money. That simple. That’s why is something that I discuss over and over again. Now, when you invest locally, you likely have some sort of local knowledge. You’ll know that this subdivision is good, this one is bad. Values are increasing here, decreasing there. You’ll have a solid idea about the real estate market, even if you’re not deeply rooted in real etate there. It just comes natural by knowing areas of town. When you start investing out of area it really throws a wrench into the plan.
That’s why it’s so crucial to learn how to research real estate online. When you invest out of area, and truthfully even locally, but especially out of area, you should become an online research genius. You should know how to use every single tool, every single map, every single program, you should be able to research properties accurately, efficiently and effortlessly. Now, obviously, this takes time. It takes time to learn how to research, to figure out the different sites, to do it efficiently. All of this takes time. And that’s ok, because it’s worth it. Become an online research expert. That’s a huge part of your business when you invest out of town.
The next tip goes right along with that and that’s to learn the area. And I’m not just talking about the obvious. Learn the good parts, the bad parts, all that kind of stuff. Of course that matters. But learning it on a much much deeper level will help you invest there. Learn the history of the area, which direction is the city growing, what are the old parts, the new parts, where is development heading. Then take it a step farther and learn about the pricing trends, the design trends, the typical house, the areas of current development, all that kind of stuff. Learn about the real estate market in general, then learn about all of the other stuff related to real estate. What are the laws there, ordinances, any regulations? What are the property owner’s responsibilities? And then of course, don’t forget the schools and economy there. If you learn everything you can possible about that area up front, it’ll make your investments there much much easier down the road.
The next tip is to use locals. And this is something that took me a few years to realize. Obviously, you can do a lot online nowadays. A lot, especially if you know how to properly utilize the tools. But, online research won’t tell you a few things. It won’t tell you about the house in that photo you found online having burned to the ground last week. Or the mobile home that’s supposed to be there that got towed away. It won’t tell you if you have squatters in the house. Or if the property is now the communities landfill. It won’t tell you that the property is the low spot of the neighborhood and floods every rainfall. It won’t tell you so much.
But as you begin to invest out of area, you might think you only have two choices: To guess, or to go and visit the area yourself. In many cases, these are both wrong. Guessing whether you should invest in something is a recipe for a disaster. And going to look at a property, when it might cost you a lot of money to get there, just isn’t smart business. So this is the ideal time to hire a local. And the fact is that it is VERY easy to hire locals using sites likes Craiglist. And if you strategize properly, for example multiple properties in one area, the cost is usually extremely low for the feedback you’ll be getting. Locals are there. And many could use a few extra bucks. Take advantage of their offers to help!
The next one, please keep it simple. This applies to local investments, but certainly out of area investments too. So many people email me to tell me that although this is their first tax sale investment, they think they’ve found a property. Then they’ll go on and on with like four paragraphs explaining their crazy idea on how to make money with it. Please don’t. It’s so incredibly important to keep it simple. Find that basic boring vacant lot you can make a few bucks off of. Search for the single family house that is about as cookie cutter as they come. Focus on the simple stuff.
The complicated properties are extremely difficult to manage, even when you’re local. Can you imagine a managing a difficult project or going through a series of tasks in order to profit from an investment and you’re on the other side of the country? Sure, these complicated deals might more more readily available than the simple ones, but don’t fall into that trap. Find the best simple deals and attack those instead! Keep it simple!
And the last tip today is to move on as needed. And this is one that I myself didn’t follow at first. I did well locally, then found success in another market and stayed there for a bit. Then another market and stayed there for a bit. I stayed when I should have added on additional markets much faster. There are no laws that say you can’t actively invest in all two thousand plus markets at one time if you want to. Obviously, we have time and capital constraints, but there will be a time to add in additional markets. And that’s ok. There will also be times to move on from markets and leave them behind entirely and that’s ok too. So many people get romantic with the idea of finding success and then smothering their own success by doing the same exact thing for far too long. They think that seeing success in one market means that must stay there because they found a honey hole. The truth is that there are fantastic markets all over the country. My advice is to find a market that works so you learn the process behind out of area investing and then begin to apply that same process and those same tactics to many other markets as soon as possible. Expand, grow, when confident of course, and your income will do the same.
So, there are five tips to investing out of area. Become an online research wizard, learn everything possible about that area, use locals to your advantage, keep it simple and then move on as needed.
Out of area investing is one of those things that, when done properly, will change the trajectory of your business and potentially even your life.
I truly hope that you enjoyed this week’s podcast episode. As a reminder, we do this podcast completely free, and in exchange we would be so appreciative if you’d take just a few seconds out of your day to leave us some positive feedback on whatever podcasting platform you’re listening to us on.
And if we can be of help in your quest for tax sale success, there are a bunch of links in today’s show notes, including one to our primary site which is at TaxSaleAcademy.com.
Thanks so much for listening today. Take care and make it a successful day. See you next time!