Buy and hold

8 Replies

Hello James Sotipalalit here. For all my experienced buy and hold investors. I have a question I seen a property for $168,000 and a great opportunity for my first buy and hold property. But here is the issue I have just been recently laid off and I have only about $10,000 dollars. Is there a way I can still obtain this property somehow with no job and only 10K? Please experienced investors I want to know how to get this property in my situation. God bless.

What is your plan?  It doesn't sound like you have one....

Frank R

Do you have some numbers to associate with your "great opportunity"?

Originally posted by @Frank Romine :

What is your plan?  It doesn't sound like you have one....

Frank R

 Well my plan is to have someone rent it out because right now it's below market value. 

I'm still new to this business so what type of numbers I know the market value is 215k and they're selling for 168k. It's a wholesaler. 

@James Sotipalalit  , for buy and hold, the discount to market value isn't as important as it is for flipping.  It's more important that the rental income more than covers all expenses including your financing costs so you can make a profit.

So, how do those numbers look?

Originally posted by @Brett Russell :

@James Sotipalalit , for buy and hold, the discount to market value isn't as important as it is for flipping.  It's more important that the rental income more than covers all expenses including your financing costs so you can make a profit.

So, how do those numbers look?

  1.  That's make so much sense. I feel dumb for saying that but I definitely want this property but the problem is laid off and only 10k cash on hand.

Personally, I think buying property without a steady income or financial reserves is very risky. What is your exit strategy if you can't rent out this house? Would you be able to get rid of it quickly before it the holding costs put you in worse financial future? What happens if your tenant stops paying?

Often times as investors we need to know when to act on deals and when to pass on them. The exit strategy is your safety net to minimize losses and protect you. If there is no exit strategy, it's a good idea to pass.

The wholesaler will probably only sell the property for all cash. The only two options are private money lenders and hard money lenders. Both would want you to put up more then 10k in cash.

I don't see a way you can get money to get this property. If you do get money, you really think think if you can handle the worst situation purchasing this property.

I wish you luck in any event with your future real estate investing and job search.

@James Sotipalalit  

 I would partner with someone local RE investors who has experience. As @Brett Russell said, for buy and hold type of deal, you need to know a lot more than just the market value. You need to know the rent, tax, insurance, HOA, and how much it costs to make it rentable. Then you can determine if it is a good deal or not.

But if you are confident that it will sale for 215K, you might consider flipping it for some quick profit. Again, you need to do you homework and make sure the numbers work out. 

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