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Owning Property Out-Of-State:

Tips To Protect Your Investment

There can be a lot of stress when owning any real estate away from where you live.  When you don’t have your own eyes on the property, you may worry about what is going on in and around the property, which can lead your imagination to run wild.  This can be a property you have on the market after moving somewhere else, a vacation home, or an investment property.  Whatever it is, even if you can’t just drive up the road to check on it, there are ways to make sure everything is going well and if not, you have the right insurance and systems in place to be protected.

Image by Rowan Heuvel

You may feel that everything is in place but it can’t hurt to look over this list to see if there’s anything more you can do.  Also, it’s good to keep in mind a few factors depending on your current situation such as: length of ownership while out of the area, condition of the property, and whether or not it is vacant.  This list is not comprehensive but should touch on a lot of major points:

Insurance and Liability - A very important part of owning any real estate is being insured properly.  If you have a mortgage through a bank, they will usually make you cover the property up to their standards.  However, if that isn’t the case, you need to make sure you are adequately covered.  You should talk to your insurance agent to go over your policy so it still suits your current situation.  A knowledgeable agent will know how to cover your property depending on the factors mentioned above.  It is always important to keep in mind that bad things do happen, even if we don’t think they will happen to us.  Fire damage, flooding from a broken pipe, a tree falling on a house, or someone hurting themselves on the property (even if they aren’t supposed to be there) are all things that can happen so it is always advantageous to have better coverage.


If you own any amount of properties, it is probably best to talk to an attorney about how to structure your portfolio to avoid liability.  For example, there are too many people who own several properties in their personal name.  Even worse, they will put both them and their spouse’s name on the deeds of all their properties.  A disgruntled tenant/occupant/visitor may decide to sue for whatever reason and having your name on the deed will make you personally liable.  They may be able to come after everything you own.  Having a great attorney structure everything with LLC’s, other business entities, and trusts can remove a lot of liability and protect you.


Property Management and Tenants - Your property may be occupied by a tenant.  In this case, we would always recommend hiring a professional property manager to manage and make sure the property is operating as it should whether you are out of the area or right up the road.  On top of this, an experienced property management company knows the laws and regulations with landlord-tenant relations so that you are protected.  If the property is vacant, it is still important to have someone you trust watching the property to know that it is being properly maintained.  When missing this piece, tenants may slack on maintenance or stop paying rent, especially if they know you don’t live in the area.

Maintenance and Upkeep - Whether vacant or occupied, this definitely needs to be focused on.  A property management company should be monitoring this if occupied.  Either they or the tenants will be making sure everything is done.  Different types of property call for different things.  For example, a single family house may  be maintained by tenant (cutting grass, snow removal, cleaning, etc.).  For an apartment building, the property manager will most likely be hiring people to do these things.  This item can have a large impact on the condition and longevity of a property so someone needs to be monitoring it.  If you choose not to hire a property manager (maybe if you have a vacant property), you still need to make sure this is taken care of.  You may have to hire a landscaper, someone to remove snow, or a maintenance person to keep things in check.  Properties that aren’t taken care of will start to become an eyesore to communities.

Vandalism/Criminal Activity - This is always a possibility when owning any sort of real estate, especially in not-so-great neighborhoods.  When it comes to any buildings, having a security system may be a good idea to deter any potential vandals or criminals.  Proper insurance to cover loss and liability is crucial as well.  It is hard to completely prevent this but you can adequately protect yourself in case it does happen.

Image by Angela Intriago

Paying Bills - This applies more to vacant properties.  With a properly managed income-producing property, there should be monthly cash flow to cover all of the expenses.  When a property is vacant, you may still be paying for any and all of these items without any income: utilities, insurance, mortgage, taxes, maintenance, etc.  These can really burn a hole in your pocket and unless you plan on filling the vacancy, you might have to ask yourself if maybe you should sell the property.


We just touched on a few things to consider if you own property out of the area.  Not that owning property somewhere else is a bad idea, you definitely just want things to be handled and covered the correct way.  There are too many properties out there that people move away from, inherit, etc. that they just let sit and hope nothing bad will happen and Murphy’s Law will usually come into play.  Anyways, if you want any more info or have questions, feel free to reach out to us!

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