First Time Investors

2 Replies

Hello Bigger Pockets community!! We are seeking some first time real estate investor advice. My boyfriend and I have been following Bigger Pockets for a while now and have been planning to invest our money in real estate somehow. We are finally at a point where we are able to take action in the next couple months, which we are really excited about. We are struggling with whether or not we should purchase a multi-family property and live in one unit and rent out the other or purchase a fixer upper for around $20,000, fix it up, and resell it. My boyfriend is a carpenter so the fix and flip would be fun for us. We are in our mid 20s, we have a combined student loan dept of $80,000, have $10,000 saved up, and are approved for a $120,000 loan. Any advice is helpful to us. Thanks guys and we hope you are having an awesome day!!

@Kellee Koenig - I'm not sure where you are living, but assuming it's in a lower priced market if you're looking for a ~$100k property. 

Since you are both young, I would recommend doing a live n flip/BRRRR strategy. @Mindy Jensen is the Queen of this strategy having done it 9 times. 

The idea is for you and your boyfriend to purchase a fixer upper home and move into it. With an owner occupant home, you are required to live there for at least one year. While living there, you and your boyfriend can fix it up and make it a very nice home to live in. By doing this, you will hopefully have increased the value of the property in excess of your purchase price plus the repairs you put into it. 

If you decide to move out after one year, you can refinance at the higher value, pull your initial money out, and do it again while keeping the first place as a rental. You'll hear this strategy referred to as BRRRR on BiggerPockets.

If you decide to move out after two years, you can sell tax free (up to $250k or $500k if you get married) and then use the proceeds from the sale to get your next property. 

I would probably opt for living there for one year and holding onto it. But I might be a little more impatient than the average person :). 

Hope this helps!!