What would you do in this scenario ?

Question

Hey everyone, I’m closing on my first duplex for 175,000 using an FHA loan. In Upstate New York. I’ll be living in one unit for at least a year, and once I move out and both units are rented, I’m projecting around 800 a month in cash flow. While I’m living there, I’m about 300 a month out of pocket. I work six days a week with long shifts. Income is good, but my free time is very limited. Looking ahead a year or two, I’m trying to decide which path makes the most sense. If you had very little free time, would you spend it renovating lower-priced properties to build equity, (BRRRR) even if that meant slower growth? Or would you focus on your career, save aggressively, and buy more turnkey or lightly value-added places that cash flow but don’t build as much equity? For those who’ve been in a similar spot, which strategy paid off better for you in the long run, and why? Thanks in advance ,I really appreciate any help with this.

James Wise · Answer

Focus on your career. Doing what you specialize in will be your best use of time. You have no competitive advantage in the renovation business I assume, so wouldn't make sense to focus on that as opposed to something you have a competitive advantage in.

Jules Aton · Answer

100%. If you are young and strong, or old and broke, working as much as you can makes sense to set up the future.

Rick Albert · Answer

Your time is your most valuable asset. Never forget that.

I've done both and they have worked out. To be honest, I don't see anything wrong with turnkey if it makes sense. You buy it, rent it, and move on. It's the base hits that build wealth. Often times I see beginner investors waiting for those home runs and while waiting everyone else is buying properties and years later those home run lookers never buy.

Mark Updegraff · Answer

I’m also in Upstate NY and I’d probably choose a third option between the two you laid out.

I wouldn’t necessarily go fully turnkey, but with your work schedule I also wouldn’t buy something where the entire return depends on you becoming the GC every night and weekend.

Look for properties where the value-add is relatively straightforward — rents below market, a unit that needs a cosmetic turn, operational expenses that can be cleaned up, maybe an obvious improvement that increases rent or value — rather than a full gut renovation.

Your time has a value too. If working six days a week is producing the income that allows you to keep buying, giving that up to save $20k on a rehab may actually slow you down.

Also, don’t overlook what you’re already doing. Buying a duplex FHA, learning to operate it while living there, and potentially ending up around $800/month positive once you move out is a pretty damn good first rep.

I’m in Rochester and work with a lot of small multifamily. If you’re anywhere around Western NY/Finger Lakes, happy to compare notes sometime.

Ken M. · Answer

Always remember that no worker is irreplaceable. That is, irreplaceable people get laid off all the time. I'd look at the whole picture first, where do you want to be in 10 years, if things continue "as is" will you get there. Since an economic crisis hits:

Recession Duration What was happening

1960–61 Manufacturing slowdown, tight monetary policy, declining investment

1969–70 Inflation and monetary tightening; slowdown in manufacturing and investment

1973–75 Oil shock, high inflation, energy shortages, weak manufacturing

1980 Fed tightening to combat inflation; credit contraction

1981–82 Very aggressive Fed rate hikes to crush inflation; severe unemployment

1990–91 Savings-and-loan/banking problems, credit tightening, oil-price shock from Gulf War

2001 Dot-com crash, technology investment collapse, 9/11

2007–09 Great Recession — housing crash, financial crisis, banking failures

2020 pandemic and shutdowns; exceptionally abrupt contraction

The most common phrase I hear during those events from people is "I should have . . ."

It seems if you are oriented towards real estate, you would team up with someone and you would spend the time preparing now, rather than relying on "I work six days a week with long shifts. Income is "good" and

an undisclosed\undefined "good" income that takes "six days a week with long shifts"

Ethan Harris · Answer

Hey Tyler I also bought a house hack in upstate NY as my first property. After living there and slowly fixing it up I was able to move out and have similar cash flow to what you're projecting in your post. I then was able to use both my personal income and property income to qualify for another house hack upgrading neighborhood and quality of property. Focusing on the rehab and BRRR is more like a part time job than a pure investment strategy. Focus on your income and repeat what it seems like you're planning on doing already. The equity and cash flow will take care of itself once your reach 2-3+ properties and can start buying your time back.

Michael Eskenasy · Answer

I’d frame this less as BRRRR versus turnkey and more as what is your highest-value use of the scarce resource you actually have?

From what you wrote, that resource sounds like time.

You already have a job that produces good income and takes six days a week. If another hour at work, or simply preserving enough energy to keep progressing in that career, has a high economic value, then spending nights and weekends personally renovating houses may be one of the most expensive forms of “cheap labor” available to you.

That doesn’t mean BRRRR is wrong.

It means I would calculate the return on the hours, not just the return on the dollars.

A BRRRR might create $40,000 of equity and look dramatically better than a lighter value-add purchase. But if it also consumes 400 hours of your time, creates six months of contractor management, and starts interfering with the career that is funding the entire portfolio, the comparison is different.

The really interesting question is:

Which activities actually require you?

Finding and underwriting the deal probably does.

Negotiating it probably does.

Making the financing decision does.

Deciding the renovation scope does.

Personally installing flooring at 11:00 p.m. after working a long shift probably does not.

So I wouldn’t necessarily choose between “do BRRRRs myself” and “buy fully turnkey.”

There is a large middle ground.

I’d be looking for properties with simple, controllable value-add and paying other people to execute most of the physical work.

Maybe the unit needs paint, flooring, fixtures, appliances and some deferred maintenance. Great. You create the scope, get bids, manage the budget and let trades do the work.

You still capture some forced appreciation without accidentally giving yourself a second full-time job.

I also wouldn’t rush past what you’re doing right now.

You’re buying a $175k duplex, living for roughly $300/month out of pocket, and projecting around $800/month once both units are rented.

If those numbers hold up after vacancy, repairs, CapEx, management and the other boring expenses, that first property is doing several jobs for you at once.

It is reducing your personal housing expense.

It is teaching you how tenants actually behave.

It is teaching you what repairs actually cost.

It is giving you experience with a 2-unit building.

And eventually it should produce cash flow.

That education is worth something.

I’d probably spend the first year getting extremely good at operating that duplex while continuing to build cash.

Then when you start looking at property #2, you’ll have much better information about what kind of landlord you actually want to be.

One other thing I’d watch is the phrase “slower growth.”

Doing heavy renovations yourself does not automatically mean faster wealth creation.

It may increase equity per deal while reducing the number of deals you can realistically handle.

Meanwhile, a more repeatable model might create slightly less equity per property but allow you to own 5 or 10 of them without destroying your schedule.

That’s why I’d think in terms of portfolio throughput, not maximum profit on one building.

If you can buy one heavy BRRRR every 18 months because each one consumes your life, compare that with buying one lightly distressed cash-flowing property every 9–12 months while your career continues producing the capital.

The second path may compound much faster even though every individual deal looks less impressive.

And your strategy can change later.

Right now your career may be the engine and real estate may be where you deploy the surplus.

Five years from now, the portfolio may be large enough that reducing work hours and taking on more active projects makes sense.

There is no reason you have to choose your permanent investing identity today.

If I were in your position, I’d protect the income engine, stabilize the duplex, build reserves aggressively, and target boring value-add properties where I can buy equity without personally manufacturing all of it with my weekends.

Your goal should not be to do as much work as possible.

It should be to own more productive assets without creating a portfolio that only functions because you never get a day off.

Caleb Brown · Answer

I would continue to house hack. Live in that duplex for a year. Then move out and repeat. Once you have a few you can explore BRRRs down the road, you could always hire a GC to do the rehab.

What would you do in this scenario ?

What would you do in this scenario ?

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