Never bought before; Moving to a new location; Duplex?

Question

Hello from South Jersey, my name's Cameron and this is my first official post on BiggerPockets. I'm looking for some advice regarding my first property.

I'm soon going to be moving to Naples, FL due to my job relocating, and I was looking into renting when in one of the webinars someone mentioned buying a duplex, renting one of the spaces, and living in the other. I think it's a great idea, and I could likely cover 75% of my mortgage payment with rent, I'm just kind of at a loss as to where to start. Being new to real estate, and with this being my first potential investment, it's definitely intimidating. There's so much that I don't know, and I don't want to get in over my head. The problem is, there isn't very much time to research before I make the move, maybe a month at the most. I could play it safe and rent an apartment for a year while I figure it out, but that would be money wasted! Also, I don't have much cash as it is, so a down payment for the mortgage is another issue. I would totally appreciate any advice as to which direction I should take, and how I should go about buying a duplex in a new area. Thank you!

Jennifer T. · Answer

Buying a multi-family and living in one part of it is a FANTASTIC way to get started in REI.  That is what I did.  One advantage is bank financing is easier, cheaper, and requires a much lower down payment for an "owner occupied" property as opposed to a "non owner occupied property.  Down payment is generally 3% for an FHA loan or 5% for a conventional loan.

Another advantage is its usually easier to manage a unit that is the same place you are living.  A great way to get your feet wet with landlording.

However, I do agree with @Kurt K.  Don't try to rush and buy a property before you move.  Rushing can lead to mistakes.  It would be difficult to do anyway in only about one month's time.  Get a month-to-month rental and/or rent someone's room.  Get to know the city and target areas that are both where you would want to live and would also be a prime rental area.  You'll have a much better idea of that after you have lived there for a few months.  You'll also have a better idea of housing prices and rental amounts for different areas.

Join an REI group and make contacts.  This also might be a great place to find a RE agent who specializes in investment properties.  When you are ready to start seriously looking, speak to a few lenders and get a preapproval.  Those are the first steps.

It is intimidating!  I know it is.  But a good RE agent and loan officer will help navigate you through the process.  And BP is also a great source for any questions you might have.

On BP, soak up whatever articles/posts there are about analyzing properties, so you feel more confident when you find the right one.  Heck, once I put together my analytics formula, I'll analyze a few properties a month just for fun and to keep my skills up.  Good luck!

Kurt Kwart · Answer

Hi @cameron

I would try to find a room somewhere while I save money and learn the market. Beans and rice; tracking every dollar. Whatever it takes attitude.

If you want to pm me, I have a mentor that moved to Naples after leaving south Jersey.  He knows construction very well and will probably start building on lots he acquired there a few years back.   Awesome dude, very smart and skilled.

Mark Nolan · Answer

@Cameron Korzeniowski

Welcome to Bigger Pockets. BP is full of resources. You will find resources here from blogs to pod casts and forums. You can also send messages to members. This is one of my favorite features of Bigger Pockets especially for asking specific questions.

Never bought before; Moving to a new location; Duplex?

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