Asking for suggestions to my situation for newbie

[Jill S Greff]

Hello All!

I am hoping to get a few suggestions for the best use of the money/situation that I have available to start. I am in my 50s and in good health and excited to start as a new real estate investor. 

I currently live in NH. I have owned my house built in 1985 and in good condition now for 8 yrs and I am the only one on the deed. I bought the home for 190k and right now its value is about 390k. I owe 165k and have my mortgage thru USDA. My mortage is 1517$ per month including property tax and homeowner ins. My mortgage interest rate is 3.5%. I have a partner we are committed to working on this as new business together.

Our goal is to have multiple rental properties with the 4 pillars cash flow, appreciation, amortization, leverage and tax benefits.  I have been reading books, listening to podcasts & webinars on this for a year via Bigger Pockets. Thank You!

We are looking to move out of NH to a warmer state such as North or South Carolina asap. I love the beach so we are looking at Charleston and Wilmington as possible areas to live. Should I be considering short, mid or long term rentals? The STR seem to have the best tax write offs but I am concerned about having too many vacancies. Wish Trumps portable mortgages were available right now but they are not. So we have a couple options.

One we could sell the house in NH, rent for a few months in the new state then buy a single family home with ADU or in law suite potential or even if could find a duplex that would work. And depending on if there is any money left see if we could use as downpayment towards a rental property maybe a small duplex. If there is not enough money left over we plan on saving money per our salaries within a year a two we could have enough for the downpayment. I am not happy with the current mortgage rates around 6.5-7% but keep hearing on the podcasts dont wait for the rates to drop as they may take years. I do not want to hold up my life for years.

Two I could rent out my single family home in NH. Work on getting a HELOC line of credit and use that money to purchase the new home in the new state. Are there any other loan options that I should consider in this scenario? The rental market in NH is strong. I am not sure if we need a rental mgmt company to run our NH home or if we should? I have contacted several mgmt companies and the going rate is 10% per month of the rental rate. Our home might rent for 2500-3000$ per month.

I am excited to hear any advice or suggestions from more experienced investors. Thank You!

Jillian Greff

[Andrew R. Lucas]

Lots going on there for just starting out!  

I'm a big believer in that the business should support you and your goals and not the other way around....  

So, I'd start with the question: Do you want to move?  And if so, where?  Then start looking for investment opportunities there. 

You mentioned a partner... Are they new too? If so, what are each you actually brining to the partnership? That should be identified asap and (more importantly) what you are NOT willing to give to the partnership....

I usually say that 2 "newbies" are the worst partners you could ever bring together... If neither of you had swam before, then why would you start a swim team?  

As for your house.... Could you get a HELOC while you still live there for $200k? If you can, could you then rent the property out and still cover that new payment? That would be a great way to get started with some capital in the business.

Happy investing!! Reach out anytime
Andrew