I'm currently in the middle of a house hack. It's a single family with 4 beds. I have the other 3 bedrooms rented out.
Since May, I've been rehabbing the house, mostly doing my own work. Once it's fully finished I'm going to refinance the house and buy another house.
My question is would you flip the next house to build more capital or would you rent out your next house?
A few things to note:
I'm 21 and really want to quit my job. I make about 50k a year. Thanks in advance!
You're 21 and make $50k a year! Damn! Good work.
And it all depends on your goals. If you want to quit your job then you probably want that stable cash flow so maybe it would best to hold on to that property and rent it out....
@Luke Turner couple things to consider.
2. Where we are in the market
3. Your time
If I were in your shoes, I would look at a couple things. Yes, flipping is attractive and can get you a big check quickly. However, it is a significant time investment as well as capital investment to make that work. If you have saved enough money from your job to purchase, fund the flip and live, maybe it's worth it.
On the flip side, B&H, as you put it, is very attractive and I think you'd find that most investors wish they had never sold x, y, z, properties with 20/20 hindsight even if the wealth that you build there feels painfully slow. That being said, rent growth has been very stable and is much more impervious to the cyclical sales market.
Everyone's answers to this question are different because we are all at different stages of our lives and have different personalities. The bonus of being young is that ideally you are more resilient, but you need to make that call for yourself.
Thanks for the reply. My long term goal is to have enough B&Hs to live off, but that would mean many more years at my job. A flip would get me out of my job sooner, but wouldn't help me out as much long term. I've been flipping back and forth between what I think is best for me, just wanted some extra insight from people who have been in my shoes.
I would say have some form of strategy. Do a flip or two then use those funds to buy and hold then start another fix and flip. It’s so many ways to go about real estate......
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing