REIA, FHA and Team Building Questions
Hi everyone,
I'm new to BP and plan on moving to Tucson in June for my first full-time job. I'm using the next two months to educate myself before putting boots on the ground. My plan is to acquire a 2-4 unit multi-family home, live in one unit and rent out the remaining ones. I plan on being pre-approved for an FHA loan to acquire the property. Long-term, I see myself being a buy-and-hold investor. That being said, I do have the following questions:
1. What should I be looking for in an REI group? Some are asking for monthly or attendance fees to join their meetings. Granted, these have more professional looking websites than free ones through meetup.com. Are fees a red flag? I understand I need to avoid groups that are trying to sell me things, but other than that, what do I seek to avoid? I'm going to attend these groups to gain connections to wholesalers and rehabbers in my local market as well as see what the market conditions are like. What else should I be looking to get from these local meetings?
2. I plan on buying my first property with an FHA loan. The low downpayment is enticing, but I am worried about how it will affect the monthly payments. Additionally, will interest rates on such a loan be significantly higher than a more traditional loan? Any resources for getting ballpark figures on these numbers?
3. Speaking of FHA loans, how long do I legally need to live there? I might not have the same job three years from now and want to know how this subsidized loan will affect my future plans?
4. A good RE accountant and lawyer are vital to successfully starting in REI. What can I expect to be paying them? I would expect to be charged for actual paperwork (such as lease contracts or doing my books) but how do consultations typically work? If I want them to walk me through paperwork or a series of questions I have, can I expect to pay by the hour?
5. For some of the more experienced people here, what is the advantage of investing in real estate instead of the market? I understand using leverage helps you gain better returns, but otherwise, is it possible to beat the market by putting money into real estate? Overtime, I'm sure I will become better at finding deals and managing properties; however, if I'm only squeeking out 2-3% more, it might not be worth it to invest my time and money in RE. If people who have been doing this for a while could give me their experience with returns in RE, that would be much appreciated.
Answers to any of the above would be greatly appreciated. Thanks BP! I'm excited to be joining such a great community.