You've acquired your 1st prop, then what??

Question

I've been doing a ton of research in getting rental property.  I believe it's the route I will take.  Can you all answer a question though:  say I have my 1st property (SFR purchased through a HELOC) and I'm profiting $200-$300/month.  Then what?  Do I start paying off the HELOC? Do I look for the next property?  What are my options?  Then when you have a few properties what are the best strategies to pay those homes off in the case of financing?  Debt Snowball?

Jonna Weber · Answer

Very first thing I would do is gather 6 months cash reserves to set aside for vacancies and repairs.  Everything else is a personal preference, depending on your goals and the level of risk you are comfortable with.  You will get many different opinions.  Congrats on taking the first step...joining BP!

Paul Ewing · Answer

A lot will depend on what your plans are.  It might be good to hold for a while and build up cash until you decide what you want to do.  You may find you don't like being a landlord in which case you can sell and move on with your life or go into some other part of real estate investing.

I waiting two years with my first two rentals before expanding last year.  I am at five now and I am using the cash flow after expenses and reserves to purchase more properties because I plan to get at least 15-20 total.  At that point I will probably start paying off any I have loans on.