hear me out

Fort Worth, Texas
Starting Out
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hear me out

Jaylin Warner
Fort Worth, Tarrant County · Member since 2026 · 12 posts · 8 votes

so i currently have a duplex that i have house hacked and looking for another deal. how ever I'm looking to pay all cash for it because i don't want to over leverage and an all cash deal would serve as a cashflow investment. now granted i don't make a lot of money i worked really hard to get where I'm at now. i do security and get paid 20 dollars hour so i don't necessarily have a lot of money but i am good at saving at least what i can. with this being said i don't see me paying all cash for a DFW deal, are market is just to much for me to do so. here is what i am thinking buying property in Wichita Falls or Sherman /Denison. I believe Sherman and Denison is a better market how ever they cost a bit more and deals are far and few under 50k there. in Wichita Falls you can find these deals. yes they are in low income areas of course like d class but i would be able to pay cash for it. the idea is to buy one cheaply fix up and rent it section 8 or group home housing for steady income. also use federal programs like HOME, CDGB, AHP. i know the stigma around these areas like don't invest and buy the block but like i said i make 20 dollars an hour. i watched this one bigger pocket episode that said to get in where you fit in. that's how I'm looking at it. i do realize when buying said asset that there is no real exit strategy. honestly i would look to hold it though. typical home buyers wouldn't want to buy in areas like this and experience investor probably have bigger fish to fry. so the only way i see me getting rid of this type of asset in any case i needed to would be to sell to another "investor like me " i know I'm not the first to think of this idea nor the last but insight from you guys would be great weather you have done it or not. would love to hear if you have and if you continue to do so and what's your strategy and if you have a out plan.

also looking to connect with other young like minded people i am a real estate investor and investment agent.

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James JonesPro Member
Investor · Collierville, TN 38017 · Member since 2017 · 842 posts · 605 votes
2d

Jaylin, the idea is not crazy — but cheap is not the same as a deal, and on a tight income you cannot afford to learn that the expensive way.

Run every one of those sub-$50K houses on the same test I use in Memphis: does the real rent clear the 1% rule against your all-in number — purchase plus rehab plus holding costs, not just the sticker price? In my market a 3BR+ rents $1,395 to $1,950 on Section 8, which is why sub-$100K works there. If your rent number is much lower, a $50K house can still be a bad buy once a roof or HVAC lands on you.

And you named your own exit problem: the buyer is another investor like you. So underwrite it like that buyer will — cash flow only, no appreciation story. If it only works because you hope the area turns, pass.

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  • Jaylin Warner
    OP
    Fort Worth, Tarrant County · Member since 2026 · 12 posts · 8 votes
    2d

    my sister does have a home i would need to manage in Oklahoma as well so i would be closer to her but not to far from my own properties. i was looking to do cash investments here and appreciation investments in dfw i figure something you paid all cash for your not really looking to leverage .

    my family and i are just getting are feet wet but we do what we can.

    or should i just buy mobile home in dfw those i can afford. i figure i would get a little appreciation with actual homes 

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  • James JonesPro Member
    Investor · Collierville, TN 38017 · Member since 2017 · 842 posts · 605 votes
    2d

    Jaylin, the idea is not crazy — but cheap is not the same as a deal, and on a tight income you cannot afford to learn that the expensive way.

    Run every one of those sub-$50K houses on the same test I use in Memphis: does the real rent clear the 1% rule against your all-in number — purchase plus rehab plus holding costs, not just the sticker price? In my market a 3BR+ rents $1,395 to $1,950 on Section 8, which is why sub-$100K works there. If your rent number is much lower, a $50K house can still be a bad buy once a roof or HVAC lands on you.

    And you named your own exit problem: the buyer is another investor like you. So underwrite it like that buyer will — cash flow only, no appreciation story. If it only works because you hope the area turns, pass.

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  • Addy Chupa
    Developer · Member since 2024 · 48 posts · 15 votes
    2d

    Getting in where you fit in is a fair way to start, and James is right about underwriting it like your only buyer is another investor. A few other things I'd think through before going all cash on a D-class house:

    1. Don't spend all your cash on the purchase. With an all-cash buy, your reserve is your only safety net. Keep enough back for a roof, a sewer line, or a few months of vacancy. A cheap house with no reserve behind it is riskier than a financed house with a good one.

    2. Check the Section 8 numbers before you buy, not after. Look up the local housing authority's payment standards for the bedroom count you're targeting, and expect the unit to pass an inspection before the first payment. Older houses in rough areas often need more work than you think to get there, so put that in your rehab number.

    3. Price insurance and taxes early. On low-priced houses, insurance can be hard to get or expensive, and it can eat a big share of the rent. Get a real quote on a specific address before you make an offer.

    4. Treat group housing as its own business. Depending on who you house and what services are involved, there can be licensing, zoning, and extra liability. Learn those rules first rather than assuming it's a standard rental with more rent.

    5. HOME, CDBG and similar programs usually run through the city, county, or local nonprofits, and the money often comes with income limits, rent caps, and paperwork. Call the local housing office and ask what's actually available to a small landlord before you count on it.

    6. Mobile homes: find out whether it comes with the land. A home on its own lot can hold value. One in a park with lot rent usually loses value, and the lot rent can rise.

    One more option to compare: your next house hack. Moving out of the duplex and buying another owner-occupied property with a small down payment might grow you faster than saving for years to buy one cheap house with cash. Run both paths and see which one gets you to your goal with less risk.

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  • Matthew MorrowBusiness Member
    Investor · PA - NY - NJ · Member since 2019 · 775 posts · 266 votes
    21h

    @Jaylin Warner smart to be thinking about not getting over-leveraged this early. One thing I learned the hard way on older, cheaper houses is to assume the last owner didn't take care of it and something big is hiding behind the walls. On a sub $50K house a roof or sewer line is a big chunk of what you paid, so I'd keep real reserves on top of the purchase price. I'd go see whichever town you pick in person too, and talk to a couple local PMs before you buy. Keep us posted.

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