Is Real Estate worth it for a 23 year old in high cost areas like Miami Beach?

Question

What's up Biggerpockets fam!

I'm 23 years old and currently working for American Airlines, starting to earn a solid income. Like a lot of young people getting started, I'm trying to figure out where and how to begin investing in real estate- and honestly, the amount of info out there is overwhelming.

A little about me: I started out as a real estate agent in Miami Beach back in 2021, learning the basics like writing leases, CMAs, client management, and cold calling. I also worked as a sales acquisitionist for a few wholesale companies, sourcing deals with Propstream, in markets like Charlotte, Atlanta, Jacksonville and even Aurora, IL. So I've had some wholesale experience in a few different markets.

Now I'm at a crossroads:

- I live in Miami Beach, which we all know is a super high-cost market.
- Should I be looking to invest in those more affordable markets I've worked in before?
- Is it better to chase cash flow in cheaper markets or aim for appreciation in more competitive ones?

I'd also love to build out a lead gen system in a niche area to start building some momentum, but I'm still figuring out which path to take- rentals, wholesaling, flipping, etc.

If you were 23 again, knowing what you now know, how would you start? What would be your first move?

Any advice from experienced investors would mean the world. Appreciate you all!

Nicholas L. · Answer

@Mateo Duba

house hack

Basit Siddiqi · Answer

as others have mentioned, I would look into house-hacking. You can get into a house at a lower down payment amount and with a lower interest rate than an investment loan.I would then look to invest in markets that provide both cash flow and appreciation. My target market is 4% appreciation and 4% cash flow making an annual 8% return.

Best of luck!

Alan F. · Answer

I wholly agree with Nicholas, house hack & if possible a modicum of value add. If you can start at a young that's best. You've got a good background, don't overturned it just consistly move forward.

Chris Grenzig · Answer

Mateo, I started a little older than you and one of the best decisions I ever made!

First, while I think househacking is one of the premier strategies for starting out in from a strictly financial perspective, especially for young people, please make sure you consider lifestyle as well. For many people, it isn't an issue, but you'll be living next to someone who pays you and that has the potential to affect your home life.

For most people and renters, there is never an issue or hardly ever, so first off, note that bad situations are less likely but can still happen.

Someone could be smoking when they're not supposed to; how do you handle that? What about someone who likes to have the TV on loud? What about if they are late on rent or if they submit a ton of maintenance requests for every little thing?

There are plenty of ways to mitigate this (hire a pm company, use an llc, do everything electronically, and probably way more), but whenever I thought about doing it, I was always very protective of my home life. I never wanted those possibilities to affect me, so I always stayed away from it. Whether that was a good decision or not, I will never know.

However, to directly address your original question of cash flow versus appreciation, it just depends on you. Some people live and die on the cash flow hill, but plenty of people have made money by buying cash flow negative properties in NY and CA. I personally like a balance, but more on the cash flow side, but it's really your call. No matter what you decide always stress test your deals and know where your cash flow break-even point is, and if something is break-even or cash flow negative out of the box, make sure you have enough income and extra cash set aside for a rainy day or year(s).

If you do decide to explore the Jacksonville or Orlando areas, definitely let me know, happy to be a resource if I can, even if you don't hire us. And if you ever are looking for a property manager for long-term rentals in either area, keep us in mind!

Caleb Brown · Answer

I would house hack. Another option is venturing 1+ hour outside of Miami. You are familiar with the area so I would assume you have a grasp o cheaper markets outside Miami. With your wholesaling experience I would use that to reach out to owners off market and find a deal. You can find a solid off market house hacking opportunity. Rinse and repeat

Jose Castillo · Answer

Your background in real estate, wholesaling, and deal sourcing in multiple markets puts you miles ahead of most 23-year-olds. That gives you unique leverage. Start with a clear objective before choosing a market or strategy, and decide what your real estate investing will do for you right now. Do you want (Monthly cash flow)(Long-term appreciation + equity)(Stack cash fast with wholesaling/flipping)? At your age and income trajectory, it might be smart to stack capital first and then pivot to cash-flowing rentals and long-term holds. Stick to the markets you already know. Jacksonville: Familiarity + Affordable; Charlotte: Great appreciation + Cash flow; Miami: Not ideal for entry-level investors unless you’re house-hacking or co-investing. If I were 23 again, I’d pick one market where I have some local insight and connections.

Go deep, not wide, and build a lead gen system using your cold call & Propstream experience. Use your airline travel perks to visit your out-of-town markets occasionally to build trust with boots-on-the-ground partners. Partner smartly; you don’t need to do it all, and you can joint venture with buyers or flippers and bring the leads. Focus on becoming known as the guy who consistently brings good deals. Focus on one affordable market you know well and build a repeatable system to find off-market deals and monetize them (House hacking, Wholesale, or Flip). Reinvest profits into one or two small rental properties a year and let compound growth do its thing. Build a personal brand around your investing journey, especially if you want to raise capital or enter a joint venture. You’ve got a killer base. Now it’s time to focus and execute one lane. Real estate rewards consistency and clarity more than trying to do everything at once. Pro tip: The deal finder always eats. Stay hungry, stay humble. You’re gonna crush it, best of Luck.

Laura Shinkle · Answer

Househacking is the best way to get into real estate, especially when you're young. You learn about houses, you learn about landlording, and it's much less expensive to purchase a primary residence than a straight investment. IMO (and I'm sure someone can argue the opposite) its less risky as well. Yes, Miami is a higher cost of living. However, if you look around, I'm sure there are areas/suburbs where it is more achievable. It may not be the popular place to live but you have to start somewhere, and this is your fastest way into real estate.

Good luck!

Arman Ahmed · Answer

@Mateo Duba

Starting at 23 with agent/wholesaling experience is great! Consider:

• High-Cost Areas: House hacking (e.g., buying a multi-family and renting out units) can be effective in areas like Miami Beach. This allows for equity building while rental income offsets costs.
• Considering different markets: Don't rule out areas that might have good potential for appreciation

Alan F. · Answer

* overthink.  Spell check 😬

Mateo Duba · Answer

@Nicholas L. House hack and then keep saving for the next one?

Is Real Estate worth it for a 23 year old in high cost areas like Miami Beach?

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