First Property Offer Accepted

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First Property Offer Accepted

Rachel Seymour-Newton
Member since 2023 · 11 posts · 14 votes

Hi there,

Im beginning in my real estate investing journey and have been working with a realtor that I trust in another state. I just put in an offer for a house that has a tenant moving in on April 15th. The realtor and I have both run our numbers and expect it to cash flow between $400 and $500. My offer was accepted, so now we are scheduling the inspection and looking at next steps. As this is my first investment property, I would love to get some opinions on important things to look out for before everything is set in stone. Any advice and input is welcome and greatly appreciated.

Another question I have is about scaling. What would be the best way to buy more properties after this one. Should I wait until I have saved for another down payment, or what have you seasoned investors done to grow your portfolio?

Thanks in advance

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Most Popular Reply

E.J. McCaffrey
Member since 2025 · 194 posts · 140 votes
1y

Now that your offer has been accepted, this is the perfect time (if you haven't done so already) to begin putting a comprehensive asset protection plan in place. A well-structured plan can provide a legal barrier between your personal finances and your investment property, helping to safeguard your assets in the event of a lawsuit or unexpected liability. Whether the risk arises from tenant disputes, accidents on the property, or even personal legal matters unrelated to the investment, having the right structure in place, such as an LLC or layered ownership strategy, can help insulate you and limit your exposure. It's always best to get ahead of potential issues before they arise, and doing so now will ensure you move forward with confidence and peace of mind.

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  • Austin Moore
    Real Estate Agent · Blue Springs, MO · Member since 2023 · 23 posts · 8 votes
    1y

    Congratulations on getting your offer accepted Rachel! Here are a few key things to focus on before closing:

    1. Inspection & Repairs – Ensure the inspection doesn't reveal major issues that could eat into your cash flow. If anything comes up, negotiate repairs or credits.

    2. Lease Agreement – Review the lease terms with the current tenant. Verify rent collection methods, security deposit handling, and lease expiration.

    3. Property Financials – Double-check all expenses (insurance, taxes, maintenance, property management) to confirm your cash flow estimates.

    4. Reserves – Have a solid reserve fund for unexpected repairs or vacancies.

    As for scaling, many investors use cash-out refinances, HELOCs, or partnering to acquire more properties faster. If you're using traditional financing, saving for another down payment or leveraging house hacking/BRRRR could speed things up.

    Good luck with your first deal—this is just the beginning!

    1Reply
  • Nicholas L.Pro Member
    Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
    1y

    @Rachel Seymour-Newton

    hello.  my top recommendation here would be to hire a reputable property manager.  

    here are some questions for you.

    did you screen the tenant, or did the prior owner screen them? have you seen this property in person? did you have it professionally inspected? were you there when the inspection took place? are you accounting for ALL expenses when you calculate cash flow, or just PITI?

    1Reply
  • Rachel Seymour-Newton
    OP
    Member since 2023 · 11 posts · 14 votes
    1y

    HI Nicholas, 

    The prior owner screened the tenant. That is a good point and I will look into that. I have not seen the property in person my self, but my realtor who is a friend of mine is going to see it tomorrow and will FaceTime me and show me around. It will be professionally inspected tomorrow as well. When calculating cash flow we calculated in PITI, along with property management, and putting some money aside for maintenance, repairs, and vacancies. Is there any other expenses you are referring to in particular that I may have missed? Anything else that you would think about?

    Thanks

    0Reply
  • Ryan SpathBusiness Member
    Real Estate Agent · Boise, ID · Member since 2017 · 576 posts · 379 votes
    1y

    Having been in your situation before with buying out of state and totally relying on other people is a tough one. 

    The inspection will be the 1st thing you will want to look at with a fine tooth comb, understand the condition of the property and the expected life of the major items (roof, hvac, appliances, water heater, age of plumbing, last time painted)

    Once everything here looks good, be sure you understand how much you need to save for repairs/capx when you are starting out, this can make or break your re business in the beginning depending on your financial situation. 


    An Awesome PM, being that you are out of the area you are going to be relying on this company to screen tenants, provide affordable repairs etc. 

    On the scaling note, this will depend on you. Do you have a high earning w2? Can you find great deals and bring partners? Did you buy undervalue, and you plan to add value and do a refi?


    Focus on what you have and make it amazing, set a long term goal of owning X properties in X years and make the necessary sacrifices to achieve this 10 years comes and goes in an instant!

    Best of luck, keep us up to date as to how this goes and what you decide to do next!

    [email protected]208-600-2814
    1Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    1y

    @Rachel Seymour-Newton ALWAYS TRUST BUT VERIFY!

    1) How good is the home inspector you hired?
    - you want the best because you won't be walking the property yourself and you seem to have little experience. Hopefully, the report will have a LOT of pics!

    2) What the inspection will not cover?
    - Inspections are most concerned with maintenance & repair issues. It is not common for them to care about cosmetics or weird layouts that make a property unappealing.
    - Be sure to record the Facetime video with your friend. You'll want it to reference in the future, especially for tenant damages.

    3) You're letting the seller dictate rent amount!
    - How do you know what the market rent is? 
    - Where are the rental comps your agent ran for you?
    - What are the average Days On Market for rentals in the area?

    4) Application Screening & Lease Quality
    - How do you know the seller isn't placing a bad tenant for the sale?
    - Have you seen the lease the seller will be using?
    - What is the security deposit and other lease terms?

    5) What is the Class of the following:
    - Location/neighborhood
    - Building condition & amentities
    - Expected tenant pool

    6) Where are the numbers you & your agent are using to get $400-$500 cashflow?
    - If you don't post them here, how can we help you with them?

    [email protected]248-209-6824
    Logical Property Management4.9460 Reviews
    WebsiteView Page
    0Reply
  • Nicholas L.Pro Member
    Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
    1y

    @Rachel Seymour-Newton

    OK - a few red flags so far: you are not seeing it yourself, and you did not screen the tenant.  that certainly makes it higher risk.  FaceTime just isn't the same as being there in person.  do you have a property manager lined up?

    it sounds like you're calculating expenses correctly, but if this property is listed on the market i am still skeptical that you'll cash flow that much.

    1Reply
    • Rachel Seymour-Newton
      OP
      Member since 2023 · 11 posts · 14 votes
      1y
      Quote from @Nicholas L.:

      @Rachel Seymour-Newton

      OK - a few red flags so far: you are not seeing it yourself, and you did not screen the tenant.  that certainly makes it higher risk.  FaceTime just isn't the same as being there in person.  do you have a property manager lined up?

      it sounds like you're calculating expenses correctly, but if this property is listed on the market i am still skeptical that you'll cash flow that much.


       Hi Nicholas, 

      I did not screen the tenant myself, but have spoken to the current PM about it and showed me how they screened the tenant. I’m comfortable with how they did it. Another note to add is that my realtor caught it before it went on the market. It never went up because I was one of 3 people to put in an offer before it was listed. 


      0Reply
  • Travis TimmonsPro Member
    Rental Property Investor · Ellsworth, ME · Member since 2021 · 1k+ posts · 2k+ votes
    1y

    You have to go see the property. Also, what is the purchase price and the age of the home? If it is a cheap and old property (sub $120k, 50+ year home), the cash flow on paper just doesn't match end of year actuals. I'm also a little cynical of the $400-500 per month cash flow on long term rentals. Those deals just don't exist without some risk due to the location or tenant pool.

    You're just stacking risk factors here. 

    1. First time investor, 2. Have not seen the property in person, 3. Long distance, 4. You are inheriting a tenant, 5. Neighborhood and tenant pool risk? I don't know but just a guess

    Each one makes the likelihood of success, while not impossible, go down a bit. If this is an A-B class property, I would feel better about it. If it is not - and be honest with yourself, would you live there? - it's gonna be tough.

    As far as scaling, that's a question for future Rachel. She's gonna know a lot more.

    2Reply
  • Kerlous TadresBusiness Member
    Realtor · Columbus, OH · Member since 2023 · 1k+ posts · 1k+ votes
    1y

    Congrats on your first deal! Before closing, focus on the inspection, check the roof, HVAC, plumbing, and electrical, and watch for basement water issues. Review the lease, ensure proper deposit transfer, and confirm tenant screening. Some cities require rental registration or lead-safe compliance, so double-check local laws.

    For scaling, consider BRRRR to recycle capital, house hacking for low down payment financing, or using a HELOC or cash-out refi to tap equity. Networking with local investors and lenders can also open up more opportunities. Track your numbers and stay patient, you're on the right path.

    [email protected]614-490-1163
    Kerlous Tadres | Reafco Real Estate541 Reviews
    WebsiteView Page
    0Reply
  • Andrew SyriosPro Member
    Moderator
    Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
    1y

    Congrats Rachel! One thing I would definitely recommend is to get the sewer line scoped. That can be an expensive fix if you it's in bad shape.

    Podcast Guest on Show #121
    0Reply
  • E.J. McCaffrey
    Member since 2025 · 194 posts · 140 votes
    1y

    Now that your offer has been accepted, this is the perfect time (if you haven't done so already) to begin putting a comprehensive asset protection plan in place. A well-structured plan can provide a legal barrier between your personal finances and your investment property, helping to safeguard your assets in the event of a lawsuit or unexpected liability. Whether the risk arises from tenant disputes, accidents on the property, or even personal legal matters unrelated to the investment, having the right structure in place, such as an LLC or layered ownership strategy, can help insulate you and limit your exposure. It's always best to get ahead of potential issues before they arise, and doing so now will ensure you move forward with confidence and peace of mind.

    4Reply
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