New Investor with money, background, need strategy advice

[Michael R.]

Hi All! I am new to the site… I do not currently own any investment properties; however I am plotting my entrance into the market. A quick background; I am a CPA investing with my dad who is a residential realtor. I setup an LLC, EIN, and we're preapproved for any range of leverage within our price range.

Now my question(s): We are investing in the NYC metro area (Westchester/Bronx), where home prices are high, and so are the rents. My question is regarding a financing strategy for the 1st home, which will begin to shape future purchases. I am currently deciding between 30-40% leverage on the 1st property (2-4 units) or an all cash purchase. Obvious plus to leverage is that we'll increase our Cap Rate using relatively low interest rates; however we'll lower our cash flow. If my plan is to purchase a 2nd home within 1-1.5 years of the 1st home purchase, would a leveraged purchase of the first home or an all cash purchase make more sense? The confusion I have is regarding utilizing the equity on the 1st home to buy the 2nd. Are Home Equity Loans the only option I will have, and if so is it possible to get a fixed rate Home Equity Loan on an investment property listed under an LLC? Are there any other options available and would leveraging a partially financed property hinder me from getting a Home Loan (aside from the fact that the loan would inevitable be smaller due to the lower equity). Any help would be appreciate…Thanks!