How can you invest in Real Estate while looking for First Home?

Question

Right now I’m living in an apartment and my Fiancé and I are trying to purchase our first home! I want to start investing while I’m searching for a house for myself. I was thinking buy a foreclosed property and taking out a rehab loan to renovate.. or is there a different path I can go?

Patricia Steiner · Answer

Owning a home is a real estate investment. The issue with attempting to do multiple purchases/transactions at the same time is that the increase in debt for purchasing the foreclosure may keep you from qualifying for a conventional residential/home mortgage and/or you may not have enough cash to close.

First things first, get pre-qualified from a mortgage lender.  Know where you are now in terms of getting a residential mortgage.  I recommend you do that investment first as interest rates and terms for owner occupied properties are some of the best ever.  Take advantage of those.  Financing for investment property requires more cash down and come with higher interest rates.  You can do it all but it takes a financial plan and patience to get it right.

Christian Rojmar · Answer

Yeah, I have the same issue in Austin, TX trying to find multi-family properties - little to no supply and very expensive. Don't know your situation work-wise/family-wise, but may be worth expanding search area a bit and see if you can find anything attractive that way if possible. If you do not already have one, I would recommend finding a RE agent who can help you find and negotiate a deal and get a loan pre-approval if the right property comes on the market as these properties typically go quick!

Jerry Maggiore · Answer

@Christian Rojmar I would definitely consider that, the only thing is, is that I can’t find anyyyyy properties like there where I live Goshen, NY

Patricia Steiner · Answer

@Jerry Maggiore

Jerry, just a couple of recommendations:

1.  Don't rush in...that's what fools do.  I see it every day where the fear of missing out makes for a "gotta buy now" - and that "gotta buy now" winds up being something that should have been left behind but now he can't get rid of it.  Hard to overcome stupid so, again, don't panic.  Plan.

2.  Please, please, please find a realtor who works with investors to help you find that first property.  As a buyer, you don't pay commissions so why not add the bench strength and get some help with the heavy lifting.  In my markets, inventory is at historical lows and has been for years.  A lot of buyers are in your position - ready to buy and nothing to buy.  And, I make the find...let a full-time professional get a find for you.  Be picky...a park bench advertisement is not where to find the investment-realtor. They're low key - working with select clients - so go find one.  That's your search.

3.  Buying the property is the easy part.  Managing it isn't.  Passive income does not mean passive management.  Be careful what you wish for...and rehabs always take more money to complete than first thought.  Know your cost. Get resources for your team (that realtor will have a whole host of contractors/handymen to help with estimates and the like).

And, most of all, congrats on doing everything right. You saved the money, you got preapproved, you even got the girl!  Celebrate what you have achieved and then go get the right realtor to move the process along more quickly.

And, please PM me to let me know your progress.  I'm not worried about you.  You shouldn't be either. You've got this.

Jerry Maggiore · Answer

@Patricia Steiner the ok here’s the boat I’m in right now.

Got my pre approval, budget is $250k In Orange County MIDDLETOWN NY.

Saving money as months pass.

Can’t find a home to purchase, losing motivation .. for now.

Dividing I’ll try other options .. any other options especially to get out of renting

So thinking wholesaling for now to gain more money whilst still looking for First home

Duplex

Multi family

Condos apartments ect

I don’t know hat path to take either.

Thank you so much, I really really want to do this real estate investing.. always been my dream ..

eventually try all methods eventually.

How can you invest in Real Estate while looking for First Home?

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