Needing advice in my rental portfolio start

Chuck Spradlin · 2025-09-17T05:28:50-07:00

Hello my name is Chuck and I’m super eager to start my real estate investment journey, I’m working with a realtor and a lender and have viewed a couple homes one potential that me and my wife want to buy unfortunately this doesn’t meet the criteria for the one percent rule, in the beginning I reached out to a investor realtor in my area using bigger pockets which fell thru due to a family emergency on the realtors end I moved forward with a reputable realtor in my area but I’m really not sure if I should move forward the house fits our needs at the moment and it does involve a little sweat equity but no a lot to do it’s mostly done how do i navigate way I should do next should I put our families needs first and just sell after two years or rent out ultimately is what we are wanting to do, I will say I’m a little overstimulated with this process in how everything is going and how hard it is for my area to find that first rental investment that both fits our needs and our rental portfolio any advice would help and thanks

Ricardo R.Pro Member

Property Manager · Michigan Ctr, MI · Member since 2016 · 661 posts · 581 votes

1y

Hey Chuck,

Totally get where you’re coming from — that “first deal” stress is real. It sounds like you’ve got two different goals pulling at you: (1) a solid home for your family and (2) a property that fits neatly into the rental numbers from day one. The tricky part is those don’t always line up perfectly, especially in today’s market.

The 1% rule is a great back-of-the-napkin filter, but it’s not the end-all. In a lot of markets it’s nearly impossible to hit, and if you sit around waiting for a textbook 1% property, you may be sitting on the sidelines for a long time. Instead, look deeper at cash flow after all expenses (mortgage, taxes, insurance, repairs, vacancy, management, etc.). Even if it’s not 1%, can it at least carry itself or come close? If it’s break-even but you’re building equity, appreciation, and tax benefits while living in it, that’s not a bad starter play.

Since the house already fits your family’s needs and only needs light sweat equity, one option is exactly what you mentioned: buy it, live there for 2 years (which gives you some tax perks on resale if you decide to sell), and then evaluate. By then you’ll know the house inside and out, the neighborhood, and the rental demand — which puts you in a much stronger position when deciding to rent it or sell.

Don’t beat yourself up if it’s not the “perfect” first rental. A lot of investors start with a house that works for their family first, and they turn it into a rental later. The key is running the numbers now so you know what that future rent scenario will look like — not just hoping it works out. That way you’re making an intentional choice, not just rolling the dice.

Hang in there — you’re doing the right thing by asking questions and slowing down enough to think it through. The overstimulation is normal, but it gets easier after the first one; I reall hopes this info. help you a bit, I sent you DM on BP hoping you can assist.

[email protected]810-844-1104

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Chuck Spradlin
OP
Member since 2025 · 3 posts · 2 votes
1y
@Ricardo R. Thank you for the kind words of encouragement and some solid advice I'm starting to see in my area it's slim pickings for the budget that doesn't always line up but there is new houses coming on the market with each passing day and I'm optimistic about it I will definitely try to plug in numbers for the break even mark I think is a good strategy to get started with building equity and reevaluate at that 2 year mark
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Nicholas L.Pro Member

Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes

1y

@Chuck Spradlin

hello. do you already own a primary? could you house hack? a house hack is a great way to get started. but, it is not a good fit for everyone.

the market is tough right now for both primary buyers and investors. i don't know a lot about you, but i encourage new investors not to buy something just to "do a deal," but to be patient and potentially spend a significant amount of time looking. if you are putting 20-25% down, that's a huge deal - it's a lot of capital to tie up in something. a lot of new investors also expect to "cash flow" shortly after buying and this just isn't the way that residential real estate works. it may take years to genuinely cash flow depending on how you plan to buy.

hope this helps

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Chuck Spradlin
OP
Member since 2025 · 3 posts · 2 votes
1y
@Nicholas L. Thanks I think the rush of do a deal because of fast selling markets in my are was initially just overwhelming we are doing a conventional loan at 3% down and seller to pay concessions or split and finance the other half I think ultimately if we don't get what we want we will try again because I agree the numbers aren't exactly there in my area without a super distressed property and that's not something my family can take on while living. I would love to do the house hack but there is just nothing available in my area so primary residence is our go to investment and then renting afterwards
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Basit SiddiqiBusiness Member

Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes

11mo

You make your money on the buy. Are you buying it at a good price(compared to comps?)

You mentioned that it needs a little sweat equity. Are you confident that you can find the contractors to fix up the house?

It is tough to find a property nowadays that meat the 1% rule.
The 2% rule was popular 15 years ago. When 2% was no longer applicable, it turned into the 1% rule maybe 8 years ago.
Now, the 'general rule' is that you may need to put down 40% to make it cash-flow

Best of luck!

[email protected]917-280-8544

Basit Siddiqi CPA4.979 Reviews

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Needing advice in my rental portfolio start

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