Inherited Property - Strategy Question

[Sean Conroy]

Hi All,

I'm new to BiggerPockets and just getting my feet wet with real estate investing. I've recently inherited a property, which I'm not selling and currently renting. The property has enough land to potentially subdivide and build another 2 units (maybe 3 to 4 depending on size). Nothing is owed on the inherited property.

My question is, with the costs of building new still relatively high, would it be better to subdivide and build on the current property or use the equity of the inherited property to buy another separate income property?

Thanks and any help/insight is much appreciated!

[Sean Conroy]

Quote from @Jaron Walling:

@Sean Conroy I'd 100% use some equity since you decided you're not selling the property. 

You can control a lot of aspects of the loan including LTV, length, type, and where to deploy the funds (BRRRR, flip, new construction). It's a win-win. If you buy the next deal correctly you won't damage the inherited property or kill the current cash-flow. You have options and that equals power. Don't take it for granted and don't take big risks with the money.

Hi Jaron,

Thanks for the reply! I was initially leaning toward BRRRR since the equity would give me a kickstart for that process. Definitely won't be doing anything risky with my first purchase. I think it'll come down to (as you mentioned) buying the next deal correctly. Thanks again for the info, all of this is super helpful as I get started.