Managing a Property in a Different State (or Country) – 6 Tips Landlords Should Know


Owning a rental property in a different state can be a very lucrative proposal. But, managing it will be more challenging. Still, this is perfectly doable, provided you have the right strategy.

A rental property can be an amazing source of passive income. That’s what makes it such an appealing investment opportunity. However, finding that perfect investment takes a lot of work. You need to decide on the size, price, exact location, etc. But before all that, there is one big choice you need to make.

That choice is deciding whether to buy locally or look for properties out of state (or even in another country).

Going with a known area is the safe bet. However, the alternative opens up many new markets and opportunities. This brings a lot of potential in terms of how much you can earn. But, managing an out-of-state property does come with certain added challenges.

The Benefits of Out-of-State Properties

When you look for investment properties across different states, you’re greatly increasing the amount of choice you have. This can bring several advantages. These are three of them.


This is perhaps the biggest and most obvious benefit here. The higher the price of the property, the more you’ll need to charge for rent to make a profit. An overpriced local market will make this increasingly difficult.

The best solution here can be to purchase out of state. You may want to look for a buyer’s market with affordable properties. This might make it easier to get a good return on your investment.


You’ll often hear that location is what will determine the potential of a property. While true, this is also an oversimplification. There are actually quite a few factors which impact how profitable a rental property can be.

You can influence some of them. For instance, you can do renovation work to make the unit more appealing. But, some of these factors are beyond your control. If the biggest employer in an area shuts down, the rental market will go down with it and there’s nothing you can do about it.

For this reason, diversifying is a smart tactic. It will protect you in case your local market takes a drastic turn for the worse.

Different Rental Strategies

You may prefer short-term rentals. These properties do better in tourist hotspots. Or, you may want to attract long-term tenants. Here, you might want to look for a unit in a suburb.

Your local market may put severe limitations on you in this regard. Those limitations do not exist if you expand your search. This allows you to go for the rental strategy you prefer.

Of course, this potential does come with a downside - your lack of familiarity with the area. This makes managing such properties tricker. But, there are tips that can help you make it work.

The Tips

As mentioned, out-of-state properties come with both advantages and challenges. The same applies to properties in a different country, even though that’s not the focus of this article.

These investments can be very lucrative, but you need to make sure you can manage them properly. The following six tips will help with that.

1. Research the Local Market Conditions and Legal Framework

One of the major issues of out-of-state properties is that you simply don’t have the day-to-day knowledge of the market conditions. This is something you need to address as best you can.

You need to know the best neighbourhoods to live in and the ones to avoid. Your potential tenants will care a great deal about this, meaning you need to care too. This will allow you to know what kind of rental yields to look forward to, if there are any problems you can expect, etc.

You also need to pay attention to local laws and regulations. Rental rules and tenancy obligations differ according to location, creating potential issues.

Not only will learning about the local environment help you avoid problems, but it will also help you get the best returns possible. The story of one of Yabonza’s clients illustrates this perfectly.

The man in question lives in Geneva but owns several properties in Australia. One of them was a strata-titled property. Thanks to their local expertise, one of our asset managers recommended changing this into a duplex. Due to this change, the value of the property increased dramatically.

Use technology2. Use the Latest Technology

Managing a property in a different state will always have its challenges, but technology can make the process much easier. For instance, online resources can be a tremendous help when researching the area you’re interested in.

Of course, the benefits of technology do not end there. There are various tools to help you, screen tenants, handle payments, communicate, etc.

Yabonza is a resource of that nature, something our clients benefits from greatly. An interesting example concerns two brothers.

They live in a rented home in Melbourne but have also purchased and rented out another property. In case you didn’t know, the term for this is “rentvesting”.

It’s a complex strategy, but technology can make it work. High-tech solutions offer efficiency, speed, and access to information. Thanks to this, the brothers are currently earning $770 per week in rent.

3. Be Certain about Your Calculations

In order to do a good job of managing a property, you need to know what everything will cost you and how much you’ll earn. This means you need to consider the rental income. And, make sure you don’t overestimate it. Doing this can hinder your cash flow, severely diminishing your ability to manage the property.

You also need to calculate all the costs. Remember, some of these can vary between states. This refers to one-time costs at closing such as land taxes or stamp duty and recurring expenses such as council and water rates. It’s important to avoid underestimating these for the same reason you need to be realistic about your income.

4. Pay Extra Attention to Tenant Screening

Screening your tenants is always important, but it’s even more vital if you’re going to be an absentee landlord. That’s because you simply won’t be around to keep an eye on their behaviour or pressure them if they’re late with their payments. You also probably won’t be able to ask a neighbour to let you know how the tenants are treating your property.

For this reason, you need quality tenants. And for that, you need a thorough screening process. This means you should check their credit history and verify any information they give you. Also, check their criminal backgrounds.

Get in touch with their previous landlords as well. Ask if there were any issues or untimely payments. Just make sure you don’t discriminate. It’s fine to be tough as long as you’re also fair.

Long leases good tenants5. Offer Long Leases to Good Tenants

This tip ties in directly with the previous one. As such, the first step is to be diligent with the screening process. Even if this means your property will be vacant for a little bit longer, it’s worth it in the long run. But, once you’re absolutely satisfied with a prospective tenant, you should do everything in your power to tie them to a long-term lease.

This benefits you in two ways. For one, you won’t have to advertise the property and screen tenants as often. This takes both time and money and is even more cumbersome when you’re in a different state.

Secondly, long-term tenants are significantly more likely to take good care of your property. The reason is simple. If a tenant plans to stay there for years, they’ll be deeply invested in the condition of the rental unit. This can be the foundation of a solid relationship which will make property management much easier.

6. Use a Professional Property Management Company

When your investment property is nearby, you can try to manage it on your own. After all, you can fix that leaky faucet on your way home. But, that’s not the case when your property is in another part of the country.

In cases like this, a good property management company is a crucial ally. They’ll take care of the repairs and any other emergencies. They’ll also help you find tenants and collect rent. Simply, you need boots on the ground to take care of the day-to-day affairs. In the meantime, you’ll worry about the bigger picture.

All of the previous tips still apply. Working with the right property management company only means you’ll have a partner to help everything along.

Managing a Property in a Different State – A Challenge You Can Overcome

As mentioned, out-of-state properties come with unique challenges. But, they also come with many opportunities. By paying attention to these tips, you can overcome the former and emphasise the latter.

Yabonza can help you with this. Our property management solution brings many advantages at a low fee – just 3.9%. Visit our website today to learn more and start maximising your property investment returns.

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