Hello Everyone - seems like this is the place where a lot of people know a lot about real estate investing.
I’m looking for advice, suggestions or recommendations for my first investment. I’m actually going through a dilemma because I’m not sure whether to go with a 3-family rental first or a flip.
This would be my first home purchase in general. I don’t own a home right now – I rent. My idea was before I buy my first house to own and live in, I’d like to buy a rental for additional monthly income, so that I can afford a better home and then use the equity to get another rental etc. My big dream was to eventually get a bunch of rentals and live off the income and continue to invest, but I see how that could take a very long time.
However, I talked to my real estate agent and he advised me to do a flip first, and if it works out, do another flip, then buy my house, and then get a rental or two. Which makes sense because I’d be able to build up equity quicker.
I am well aware of the responsibilities that come with rentals, although I’m sure you guys would know of more than I do. Although I’m in healthcare finance now, not making a whole lot money, I do have construction background, so I’m not afraid of a flip either.
Then comes the question of how to get the mortgage for these properties. I have 12k cash but can sell one of my cars and get additional 13k for a total of 25k as a down payment. If I’m correct, with either a flip or a rental, I’ll have to get a conventional loan and 20% down, which leaves me very little money to rehab if I go with the flip, possibly, none.
There’s also the option of doing FHA with less, rehabbing the place with the remaining cash while living in it for a year, and then after a year, sell it gaining some equity. By then I should have enough to get another with a conventional loan, with money down and for rehab itself.
I’m really not sure which is the best way to go. Ideally I’d like to get into a house of my own within a year, while doing either the rental or a flip. Long term, I think I’d like to own a few rentals and live off that, but again, those are just dreams for now
Any and all feedback is greatly appreciated.