Should my first deal be a multi, flip or long term flip

6 Replies

Hi to my fellow bp members so I’m 27 looking to get my first deal in real estate my question is. Should I buy a duplex, tri or quad as my first deal doing a live an rent an pocket cash right away or should I seek a partner to do a flip or buy a long term 2 year live in flip an pocket some money after the wait is over with taxes. I’ve been working at a dealership for a few years now so I qualify for a mortgage I make decent money I believe I could use the money in my 401k as a down payment that I may have to payback. I’m open to sound advice just trying to make a good decision. By the way my market is Michigan I’m a Detroit native yes property is cheap in some areas but don’t get it twisted Detroit has some areas with high value here also there are surrounded cities with great markets as well. Thanks I appreciate all the help from those who reply. 

Originally posted by @Arthur Wilson III :

Hi to my fellow bp members so I’m 27 looking to get my first deal in real estate my question is. Should I buy a duplex, tri or quad as my first deal doing a live an rent an pocket cash right away or should I seek a partner to do a flip or buy a long term 2 year live in flip an pocket some money after the wait is over with taxes. I’ve been working at a dealership for a few years now so I qualify for a mortgage I make decent money I believe I could use the money in my 401k as a down payment that I may have to payback. I’m open to sound advice just trying to make a good decision. By the way my market is Michigan I’m a Detroit native yes property is cheap in some areas but don’t get it twisted Detroit has some areas with high value here also there are surrounded cities with great markets as well. Thanks I appreciate all the help from those who reply. 

 HI Arthur.  I was born and raised on Detroit's west side.  I invest in this area because it's a great area to invest in...but you have to find the micro-markets where the money is to be made.  

To answer your question, would be impossible without a lot more into...a LOT more info. At this point, what you are asking with regards to REI, is just like asking someone what car they should buy. Everyone has their own preferences, for both REI and Cars, but they are based on their own sets of criteria, limitations, and strengths...which you have not stated here...yet.

Yes to every option you suggest.

Your decision will be based on your own business plan. You need to thoroughly study all the aspects of finances and investing and learn your markets. You can then develop your own plan not simply take random suggestions from strangers on line. Our advice will be to do any one of the possible options as they all make money when done right. Done wrong, based on you and your market, and you face bankruptcy.

Decide what works for you and make a business plan to follow. Remember you are starting a business not simply investing money. It is not a simple process and most will fail due to poor planning based on lack of research.

Step one is to learn everything about the business first. You do not need random advice.

Originally posted by @Thomas S. :

Yes to every option you suggest.

Your decision will be based on your own business plan. You need to thoroughly study all the aspects of finances and investing and learn your markets. You can then develop your own plan not simply take random suggestions from strangers on line. Our advice will be to do any one of the possible options as they all make money when done right. Done wrong, based on you and your market, and you face bankruptcy.

Decide what works for you and make a business plan to follow. Remember you are starting a business not simply investing money. It is not a simple process and most will fail due to poor planning based on lack of research.

Step one is to learn everything about the business first. You do not need random advice.

 Paraphrasing a great Patriot, "I regret I have but one vote to give to this post".

My advice to any investor, buy what you know. Following the crowd is rarely the answer. If you know your market, you know a good deal when you see it. Flipping and house hacking are commonly used to get started. I recommend buying and holding. I would not touch the 401K, but I would stop putting money in it so you can have cash for renovating your new investment property.

Originally posted by @Anthony Dooley :

My advice to any investor, buy what you know. Following the crowd is rarely the answer. If you know your market, you know a good deal when you see it. Flipping and house hacking are commonly used to get started. I recommend buying and holding. I would not touch the 401K, but I would stop putting money in it so you can have cash for renovating your new investment property.

 Actually, your 401k is a great resource here, but as a loan from it.  Let your investment pay the loan back...which means the cost of the loan (interest payments) in reality is an investment...that means this turns your 401k money into 2 investments at the same time...the RE and the 401k

Educate yourself and see what most interests you.  If you don't like to deal with contractors, the flip might not be for you.  My first deal was a house hack in the 90s, before the term house hack existed.  $780 a month house payment.  3 bedroom house.  2 roommates paying $250 each.   I got the master with the attached bathroom and both garage spaces.  Worked great.  Everyone was happy.  Either house hacking like that or with a duplex you live in and can put a small downpayment on should be an easy way to get started.

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