Optimal Finance Daily - Financial Independence and Money Advice 3316: The Downsides to Owning Out of State Rental Properties by Joel of 5AM Joel on Hidden Risks of Rentals
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Oct 13, 2025 Managing rental properties far from home comes with unique challenges, from unexpected repair costs to navigating local laws. Joel shares how distance impacts DIY repairs, emphasizing the need to hire contractors for simple fixes. He discusses the hassle of filing taxes in multiple states and building trust with remote teams. While real estate investing has its downsides, Joel reminds listeners of its long-term potential and contrasts it with stock market investing, offering valuable insights for new investors.
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Cost Of Being Too Far To DIY
- Joel describes a storm in Texas that damaged a fence, gate, and gutter and cost $800–$1,200 to fix.
- He notes he could have repaired it himself but lives 1,463 miles away, forcing him to pay contractors for small jobs.
Inflate Maintenance Budgets
- Inflate your maintenance budget when analyzing out-of-state deals to account for higher contractor costs.
- Tighten purchase criteria for distant properties to compensate for remote management overhead.
Local Politics Drive Profitability
- Local political and development changes can dramatically alter a property's profitability.
- Owning in multiple jurisdictions forces you to monitor city, county, and state news continually.
