New and stuck in analysis, looking for advice for how to start

[Benjamin Dolly]

I'm a 37-year-old high-earning W2 software engineer looking to get into real estate by investing in LTR single or multi-family homes, probably out of state. I've read all the books, listened to the podcast, gone to meetups, and am studying for my RE license. My sticking point is that I only have a small amount of capital from savings to get started, which would put me in high LTV financing or high-interest non-conventional financing.

Is it worth getting into a property with over 80% LTV and high leverage, or would that suck the upside (cashflow) out of a deal for too many years?

Are there other strategies that would make more financial sense with a little money down, or is it better to wait and build that initial capital? 

[Nicholas L.]

@Benjamin Dolly

hello.  I have good news and bad news for you.  The bad news is that the market is genuinely terrible for new investors right now.  That doesn't mean you should give up, it just means you should be cautious.

and the good news is that you don't have 'analysis paralysis.' that's a made up condition by the people selling the things to get you to buy the things.  because they make money even if you buy a bad deal.  and so, there's no reason to buy before you're ready.

(can you house hack?  if you already have a primary residence, or your lifestyle doesn't permit it, that's fine.  but i always have to ask because house hacking is such a great way to get started.)

OK.  on to out of state.  if you have limited capital, should you buy a random property thousands of miles away, just because you found BP and now have to do a deal?  nope, nope, nope.  again, the market is tough right now for just about every strategy, with prices and interest rates high. and for LTRs - there isn't any cash flow initially. none. 

the first few years of ownership of an LTR will be INvesting - as in, you putting your hard-earned money into the property. you may know this from having a primary residence, but even purchasing itself is expensive as you have to pay a bunch of closing costs out of your own pocket.

so, i vote for building initial capital and also trying to stay closer to home even if it's a couple hours away.

how out of state investing can go if not done properly:

https://www.biggerpockets.com/forums/48/topics/1242392-rough...

https://www.biggerpockets.com/forums/48/topics/1137397-balti...

https://www.biggerpockets.com/forums/432/topics/1231840-sell...

https://www.biggerpockets.com/forums/311/topics/840134-memph...

https://www.biggerpockets.com/forums/963/topics/1195280-expe...

hope this helps.  i'm happy to dialogue further / answer any questions you have.  i've done a bit of everything at this point and i'm on here to help new investors not lose money.