Webster Grvs, MO · Member since 2017 · 2 posts · 1 vote
My goal is to save up $10k to invest with two partners. One with access to experience, one with access to money, and me with time to work, analyze, and learn. Would I be better off:
1. Taking my $10k to buy a duplex to house hack via FHA loan (and if so is 10k enough?)
2. Using a partnership to buy a better property (higher ROI?)
3. Using a partnership to flip a house to build capital for my own rentals.
My goal is to own multifamily properties (2-4 doors for now) and I want to get started sooner rather than later.
I'm 23 year old recent college graduate and so far my only experience comes from podcasts, books, and conversations. This is my first post so any advice would be extremely valuable! Thanks!
Rental Property Investor · Washington, MO · Member since 2015 · 30 posts · 14 votes
9y
@Keith Bowman, Ian is right it really depends on your needs. If you need a place to live, you could easily afford a duplex in the south city area. If the duplex has 2 bedrooms on each side you could rent out one side and also rent out the extra room to a friend on your side. This would probably deplete your cash pool but you would be able to live practically free and be able to save a ton of money that would have been going to rent. "A Penny Saved is a Penny Earned". If you want to learn about this the biggerpockets book "Set for Life" is awesome for guys coming right out of college. Have you read that?
However, if you are able to live rent free already maybe living in your parents basement then partnering up could be a better choice. If you find the right partner you could buy a larger multi-family or a few single family homes. Experience will come with every deal you do so this could be a good route too.
I only have experience with buy and hold rentals so I dont know much about flips. If you have any questions about St. Louis or FHA loans just connect with me and PM me. I have only done 2 deals so I'm pretty new too. I can tell you all about the mistakes I've made already so you can avoid them lol
Investor · Las Vegas, NV · Member since 2012 · 119 posts · 104 votes
9y
I think it is always better to be an independent owner. If you have to partner with others to get started then you should, but I think the goal should be to own your own properties as soon as possible. There are probably others who feel differently....so you will get a lot of different viewpoints as food for thought!
Specialist · Charlotte, NC · Member since 2016 · 239 posts · 117 votes
9y
I guess the question really lies in if you need a place to live! All three options are great for your first deal. Each one will allow you to understand the process of purchasing an investment home while also allowing you to understand some of the aspects of PM if you choose to do so.
Webster Grvs, MO · Member since 2017 · 2 posts · 1 vote
9y
@Ian Kurela I'm renting now and my lease is up next may so if I were to purchase a property I would really prefer to live there (house hacking) rather than sign away another years worth of rent to my current landlord when I could be putting that money toward my own equity. I've thought about a buying a duplex in which I would rent out the other side and then any spare bedrooms on my side to one of my current roommates. After a year with an FHA I would move out and see if I could buy another deal with money that I saved during the house hack. I'm just curious if I would get a better ROI buying a fourplex or doing a flip with a partnership. In the fourplex (or triplex) scenario I would live in the building as work as the PM.
Rental Property Investor · Washington, MO · Member since 2015 · 30 posts · 14 votes
9y
@Keith Bowman, Ian is right it really depends on your needs. If you need a place to live, you could easily afford a duplex in the south city area. If the duplex has 2 bedrooms on each side you could rent out one side and also rent out the extra room to a friend on your side. This would probably deplete your cash pool but you would be able to live practically free and be able to save a ton of money that would have been going to rent. "A Penny Saved is a Penny Earned". If you want to learn about this the biggerpockets book "Set for Life" is awesome for guys coming right out of college. Have you read that?
However, if you are able to live rent free already maybe living in your parents basement then partnering up could be a better choice. If you find the right partner you could buy a larger multi-family or a few single family homes. Experience will come with every deal you do so this could be a good route too.
I only have experience with buy and hold rentals so I dont know much about flips. If you have any questions about St. Louis or FHA loans just connect with me and PM me. I have only done 2 deals so I'm pretty new too. I can tell you all about the mistakes I've made already so you can avoid them lol