Need real estate advice

[Joseph Savant]

My current situation:

2019- I bought my primary home VA loan

2021- I retired from the army.

Dec 2021- i bought my first rental home and currently rent it out to my mother and father.

I have a full time job and almost $25,000 saved up to invest in my next property. 

Everyone knows how the market has been but i need some advice from someone with experience on what you would do in my situation. 

I am not sure if i should just keep saving and wait, or find something on the lowest end i can find or find something on the higher end. My dream is to own an apartment building but I am open to starting with single family homes. 

I am open to any and all advice. thank you all. 

[Michael Scott]

@Joseph Savant

Congratulations on getting started! You've already got the hardest step out of the way, purchasing that first property. With regards to the market, I cannot speak to Raleigh but my overall opinion is that we wont see a crash like we did in 2008. There may be a correction but I don't believe there will be a crash. Generally speaking even with the rise in interest rates if you were to look historically, we are still on the lower end. So that shouldn't scare you on continuing your real estate investing. 

There are several strategies that you can use to jumpstart into the next phase of your investing. For example, you could partner with a more advanced investor and invest your money into a bigger deal with someone who has the experience in apartment buildings you're looking to get into. There are plenty of people out there who would love to teach what they know. You would also have skin in the game to give yourself the motivation to learn everything you can. Next, your could focus on owner finance deals where you could bring little to no money down and build your rental portfolio. I know several people who have built a nice rental portfolio focusing on owner financing. You could also look into private money partners. I have done a few deals where a private lender financed 100% of the purchase of a cash flowing rental. They hold the note and mortgage as collateral, my renters pay that off and I collect the cash flow. There so many way to get creative in real estate, that what makes it so much fun!

I would also really try to focus on what your real estate investing goals are. Take an hour out of your day and really think about where you want to go. Once you decide, create a plan and execute every day. Best of luck on this next journey!

[Theresa Harris]

If by buying on the lowest end, you mean something in a questionable area, I would not do that.  If you are looking to buy and hold long term, find something where the numbers work and buy it.  Make sure it is in a good area (ie safe, family neighbourhood).  Interest rates are going to keep going up. What about a duplex?

[Mitch Miller]

@Joseph Savant I would just echo the replies you have received.  I would follow your plan and your investment goals.  If your goals right now are single family homes I would continue down that path.  I love the quote you marry the price but only date the rate.  I would not worry about rates as one of two things will happen.  Rates continue to go up and you got the best rate you will ever get OR rates fall and your refi. 

It sounds like you are into long term rentals. If you are worried about values, I would say that should take a back seat to the rest of your metrics.   I would just focus cashflow or the 1% rule or what ever metric you use, are more important than speculating on the value of properties in the next few years.

With inflation continuing I cant think of a better spot for my cash than in leveraged real estate that produces income.  

Just my two cents.

Best,

[Nadia Bareisha]

Real estate agent from Raleigh, NC here. I work with investors a lot. Right now Raleigh and Triangle market has shifted. We see a lot of properties sitting past one weekend of listing (unheard of in the last few years:). Due diligence is not as bad as it used to be, owners are willing to negotiate. Depending on where you would like to concentrate on, you can offer under asking price. That being said, we had such a rapid price hike in the last few years, that the prices are still hovering at their peak. But IMHO it will start changing toward fall, especially if the higher interest rates spook more buyers. 

I'd be happy to discuss in more detail with you if you would like to PM me.

[Pat Lulewicz]

Definitely recommend continuing down the road of investing in SFH if that's what you're familiar with until you have a track record of doing more or going bigger. Get with a private or hard money lender, connect with wholesalers and others to bring you off-market deals, and don't stop buying. Rent rates are poised to continue to rise in most parts of the country. Though interest rates will be high for your refinances these days, make sure they cash flow now and make sure eeto look at the long-run prospects of the properties when rates come down and you go from a 5-6% ROI to a 15-20% ROI.

[Eliott Elias]

Take advantage of your VA loan and move it to a cash flowing fourplex in Killeen TX