Hi!! I’m a New Investor!! SFH vs Duplex. Advice please

[Nagarjuna Kalavagunta]

Hello investors,

I’m a new investor and joined BP Pro membership today. Wanted to say Hi to everyone.

I wanted to invest in Converse/ Seguin / New Braunfels area. I have couple of questions regarding this -

1. Is my choice of locations good ? Because I consistently see a lot of houses vacant for rent here. 
2. As I’m very new to investing here, is it wise to purchase a Single family home around $250K as my first investment property or buying ~450K duplex ?

I already own a house and cannot do house hacking.

many thanks in advance.

Regards,

Naga

[Bjorn Ahlblad]

@Nagarjuna Kalavagunta welcome to BP! It depends on your goals and preferences. Many investors prefer SFR and others want duplex and four plex. There is no reason to rush in this market.

My suggestion is join a LL or REI association in San Antonio, go to meetings and network with people. Get to know the neighborhoods and decide what kind of properties you want to own and what your goals are.

[Lawrence Potts]

Quote from @Nagarjuna Kalavagunta:

Hello investors,

I’m a new investor and joined BP Pro membership today. Wanted to say Hi to everyone.

I wanted to invest in Converse/ Seguin / New Braunfels area. I have couple of questions regarding this -

1. Is my choice of locations good ? Because I consistently see a lot of houses vacant for rent here. 
2. As I’m very new to investing here, is it wise to purchase a Single family home around $250K as my first investment property or buying ~450K duplex ?

I already own a house and cannot do house hacking.

many thanks in advance.

Regards,

Naga

What data are you going off of to determine whether or not a location is good or not? I’d use data to back up your hypothesis. Why did you pick those areas? If you’re seeing a lot of “for rent” signs, it could be a number of things:

1. People are moving out of those areas so there is an increase in supply and decrease in demand

2. Supply is increasing to meet high demand

I suggest looking up KPI’s for your locations to determine which is driving these increases in availability. Is it job loss? Job growth? Etc.

Your second question completely depends on your goals and what you are wanting to accomplish long term. What strategy makes sense to you? How do you want these assets to help you?

Hope that helps! Send us some examples of deals and we can take a look at analyzing them!

[Eliott Elias]

These are up and coming markets from what i've heard. Smaller towns with moderate investor activity. 

[Aaron Francl]

Hi @Nagarjuna Kalavagunta - welcome!

I'm happy to provide you a little insight into the areas you mentioned. 

Generally speaking, those are all areas that should be targeted by investors. The 35 corridor would absolutely be an area I'd focus on. Given the lack of inventory and increased competition for assets in both San Antonio and Austin, investor activity has been consistent in the areas you mentioned due to necessity and price points vs. the larger cities (SA & Austin).  

As for anything specific for you, there are a lot of variables that exist between the two types of assets you mentioned. What are your short term and long term goals for this purchase? Those insights will help guide you to your answer.

Shoot me a message if you'd like to connect further and best of luck to you in your search!

[Jordan Moorhead]

@Nagarjuna Kalavagunta I recommend buying as many doors as you can to get started. We find some great small multifamily for clients and have a great agent in that area!

[Nagarjuna Kalavagunta]

Quote from @Jordan Moorhead:

@Nagarjuna Kalavagunta I recommend buying as many doors as you can to get started. We find some great small multifamily for clients and have a great agent in that area!

 Thank you @Jordan Moorhead. 

My goal is to invest in small multi-family and then after getting enough experience I want to transition to small apartment complexes down the line.

My concerns are if I buy a multi-family, If there are more vacancies, I will have to come up with the monthly payments myself. If it is just a single family home, then I can manage the payments without any issues. Any thoughts on this?

Also, can you please share the agent contact in this area? I have plans in buy by end of this year and currently saving up for down payment.

Regards,

Naga.

[Nagarjuna Kalavagunta]

Quote from @Aaron Francl:

Hi @Nagarjuna Kalavagunta - welcome!

I'm happy to provide you a little insight into the areas you mentioned. 

Generally speaking, those are all areas that should be targeted by investors. The 35 corridor would absolutely be an area I'd focus on. Given the lack of inventory and increased competition for assets in both San Antonio and Austin, investor activity has been consistent in the areas you mentioned due to necessity and price points vs. the larger cities (SA & Austin).  

As for anything specific for you, there are a lot of variables that exist between the two types of assets you mentioned. What are your short term and long term goals for this purchase? Those insights will help guide you to your answer.

Shoot me a message if you'd like to connect further and best of luck to you in your search!

Thank you @Aaron Francl for the response.
My goal is to invest in small multi-family and then after getting enough experience I want to transition to small apartment complexes down the line. If I have to buy a duplex vs. SFH, will there be a lot of differences.
Also, duplexes in this area are at least $450K. In your opinion, Is it worth the wait for some more time ?

@Aaron Franclundefined

[Jordan Moorhead]

@Nagarjuna Kalavagunta @Aaron Francl is our guy! I like multiple doors because if you have a vacancy it's not 100% like what happens with vacancy in single family

[Nagarjuna Kalavagunta]

Quote from @Jordan Moorhead:

@Nagarjuna Kalavagunta @Aaron Francl is our guy! I like multiple doors because if you have a vacancy it's not 100% like what happens with vacancy in single family

 Thank you @Jordan Moorhead I have reached out to @Aaron Francl

 

[Edgar Sanabia]

Quote from @Bjorn Ahlblad:

@Nagarjuna Kalavagunta welcome to BP! It depends on your goals and preferences. Many investors prefer SFR and others want duplex and four plex. There is no reason to rush in this market.

My suggestion is join a LL or REI association in San Antonio, go to meetings and network with people. Get to know the neighborhoods and decide what kind of properties you want to own and what your goals are.

As Bjorn mentioned its a good idea to meet with local investor through Facebook groups or networking events. That way they can really give you valuable information .

[Darius Nunez]

@Nagarjuna Kalavagunta

I’d suggest getting in connection with an investor friendly agent in your area who is aware of the market rents in your area. If the mortgage payment is modest and the tenants can cover it sounds like a win to me. Of course do your due diligence but cashflow is king!

[Naz Hossain]

It really depends on what your goals are and what you can handle. Everyone's path is different. You can reach your goal with 100 doors or 10 doors. You could go section 8 or you could go ultra luxury. It all depends on what exactly you are looking for. It will also depend on how your finance looks like, what you can afford etc. 

That being said, I love San Antonio. I am biased though, I am a texan and spent a lot of time in the area. I come across a lot of properties in the area as well. I focus on the inner city though. The areas you are looking at are definitely worth your while. They are more suburban areas but not large metropolitans like Austin and/or San Antonio (except for converse, it's still considered San Antonio). 

Let me know if you want to chat about your goals and I can point you in the right direction. I don't know everything but I know quite a few people! 

I am also curious as to why you cannot househack. 

[Jose Zazueta]

Quote from @Nagarjuna Kalavagunta:

Hello investors,

I’m a new investor and joined BP Pro membership today. Wanted to say Hi to everyone.

I wanted to invest in Converse/ Seguin / New Braunfels area. I have couple of questions regarding this -

1. Is my choice of locations good ? Because I consistently see a lot of houses vacant for rent here. 
2. As I’m very new to investing here, is it wise to purchase a Single family home around $250K as my first investment property or buying ~450K duplex ?

I already own a house and cannot do house hacking.

many thanks in advance.

Regards,

Naga

Good morning Naga,

I recently moved to New Braunfels, TX, and dipped my toe into REI in San Antonio last year. Like you, I also felt like I had enough sense to make something happen, but due to the volatility in the market, I wanted a trustworthy agent to help me navigate the process. Long story short, I came into BiggerPockets and found Loren Polito, who specializes in multi-family. He took the time to explain all the details I was missing, never pressured me into anything, and shared his personal investment strategies and contacts. He also brought me off-market deals. I ended up purchasing a property in SA, and I am currently seeking a second. As you can see, I am not actively posting here, but I felt compelled to share his contact information with you in case you need someone you can trust in your corner. Link up with Loren here: https://www.biggerpockets.com/...   

Best of luck brother

[Nagarjuna Kalavagunta]

Quote from @Jose Zazueta:

Quote from @Nagarjuna Kalavagunta:

Hello investors,

I’m a new investor and joined BP Pro membership today. Wanted to say Hi to everyone.

I wanted to invest in Converse/ Seguin / New Braunfels area. I have couple of questions regarding this -

1. Is my choice of locations good ? Because I consistently see a lot of houses vacant for rent here. 
2. As I’m very new to investing here, is it wise to purchase a Single family home around $250K as my first investment property or buying ~450K duplex ?

I already own a house and cannot do house hacking.

many thanks in advance.

Regards,

Naga

Good morning Naga,

I recently moved to New Braunfels, TX, and dipped my toe into REI in San Antonio last year. Like you, I also felt like I had enough sense to make something happen, but due to the volatility in the market, I wanted a trustworthy agent to help me navigate the process. Long story short, I came into BiggerPockets and found Loren Polito, who specializes in multi-family. He took the time to explain all the details I was missing, never pressured me into anything, and shared his personal investment strategies and contacts. He also brought me off-market deals. I ended up purchasing a property in SA, and I am currently seeking a second. As you can see, I am not actively posting here, but I felt compelled to share his contact information with you in case you need someone you can trust in your corner. Link up with Loren here: https://www.biggerpockets.com/...   

Best of luck brother

Thank you Jose. 

[Kingshuk Banerjee]

I own a rental in the NB area. I bought it as new construction on 2021, closed in 2022 and running well. 

Please do run your numbers and keep reserves so that in case of vacancy or repairs, you do not feel uncomfortable. Now mortgage rates are high and prices have not come down much in comparison, so I would run cash flow numbers conservatively (at least should be break even after all expenses) and not depend solely on appreciation. 

Other thing to consider is property management and your time. Will you manage yourself or hire a PM? 

Somewhat unrelated to your question but I will mention anyway - You may also compare with other forms of passive real estate which has better diversification and see if it suits you - REITs or private funds. 

[Hamp Lee III]

An interesting market for multifamilies…definitely need a good strategy and an investor friendly agent to help you identify the right properties that will cash flow.

I wish you all the best. Let me know if I can help.