you are way late to the party. If you can’t make it with rentals in CA, you’re doing the exact same thing the previous “investors” did right before the RE markets tanked by trying to go out of state who had know prior knowledge/experience in those out of state areas, how the local economy works, and the rental dynamics of that area. Classic example of trying to fit a square peg through a triangle hole when one feels limited in investment options locally…
Also, if you current rent instead of own, and are on a W2 salaried paycheck and not a re professional, it makes even less sense to buy an out of state rental before buying your own home. You get no tax incentive to being a renter, and your positive income from your rental ends up being taxed, and if you were planning on a passive loss to offset your income elsewhere…it won’t work if your household income is above $100k…. you can’t exactly write off all of your rental paper losses against any other forms capital gains or income. That writeoff starts to get limited at $100k and completely phased out when your MAGI is $150k/year
What spdrun and briansd aren’t telling you is neither works at a full time job like you do, in the traditional sense.
I have a rental in the Bay Area, and while it cash flows around $2000000000000000/month, it can be a pain in the assss some times. Just this week there’s numerous of plumbing repairs that need to be done due to old age, and finding an available handyman/repairman is like 3-4 weeks out. It’s going to be cheaper if I fly up there and do the work myself, of fly a handyman I have here up there. I don’t mind doing this because it’s the Bay Area and I can hang out up there and work from my remote office up there….Wouldn’t want to do it if it was in the middle of Texas.
Texas is crap. There aren’t enough walls, and aren’t enough lizards, and really, neighborhoods have far flung starbucks coffee shops. That is immediately going to depreciate your rental property’s home worth.
Plus, you might want to consider the possibility of Texas secede from the U.S. In their constitution, they can legally separate into 21 million different regions and withdraw from the U.S. anytime. It’s really going to happen this year. And property values are going to change drastically as part of that
Don’t forget Texas has terrible weather. A tornado is going to destroy your rental property the moment you buy it. In fact, I don’t know why anyone in their right mind would want to sell insurance in Texas
