All Forum Posts by: Gabriel Harrison

@Valerie Hiscoe thanks for the confidence booster! 

@Ned Carey well, I suppose i have my answer then! flipping it is.

Thank you so much everyone for your responses, you have all been incredibly helpful. I will continue to look into making my goal a reality. But until then I will need to flip some houses!

Hi @Ned Carey - first, let me just say, that when I saw you responded to my post I was very excited as I have read many of your other posts which were very informative.

Sorry for being unclear in my initial post - I actually currently own a home (my current residence) in the outskirts of Towson and I do rent out one of the rooms for a cool $600 a month.

Very good point - I really only have about 10k that I want to initially spend towards the investment of either owning OR flipping a home. If I bought a rental I would probably sweat a bit taking money from my personal checking account to afford a repair.

I agree with you that flipping is a good way to build up some cash so I think this might be my best bet in order to accomplish my goals.

Side note: do you think my goals of owning enough rental properties to make 300k+ annually is unrealistic? I see that my math above is flawed, I suppose it would all depend on how long I owned the property for and whether I owned them outright.

Hi @Kevin Tran and @Devin Morgan, thank you both for your replies! Try not to get too wrapped up in those assumption figures as they are merely there for example purposes. But I would Imagine that as an average, 50+ houses would in fact net me $500 a month if I spent 50k total and have $1200 coming in :). Again these are just here for example purposes, the important part from that line is: I aspire to one day have a large portfolio of rentals that annually cash flow in the six-figure range.

@Devin Morgan why would you flip first? Assuming you were in the same position as me.

Thanks!

I have a conundrum that has constantly been filling my thoughts and I desperately need some advice. Please help internet!

Here is my current status : My end goal is to be a real estate investor with enough rentals to make me 300k+ a year (I estimate this to be around 50 houses assuming each house makes me $500 a month). Right now I am 25, I have a stable steady job making 60k, I have great credit, I own a home in Parkville MD valued around 150k and I have about 10k of my own money to invest. I realize this is not enough money to buy a house and renovate one BUT that’s why loans exist(either hard money, credit card, or private loan from parents).

Here is my question:

Would it be better for me to start by flipping houses to acquire more cash OR would it be most beneficial for me to use the 10k as a down payment on a 40k house, use credit card loans to fund the rehab of the house and then rent it out (either traditionally or section 8)? In the areas I am looking at, median rentals are $1,000 – 1,200 a month (26% ROI).

The twist:

Currently, I live in the County (Baltimore) – but really want to move down into the city as soon as I can with my girlfriend who lives with me as well (she will be making around 50k). I am worried that if I do venture down the path of securing a rental home, it would deplete my down payment money AND raise my debt to income level to a level I would be unable to secure another loan for the house is the city. I also want to keep my current home and rent it out (My mortgage is 978 and I can rent it out for around 1300) – this isn't a great ROI but the area it is in is slowly increasing in value three years ago I purchased it for 142k and now it's is valued at 10k more at least.

Flipping would allow me to gather more cash, faster, which I could use both towards buying a home in the city for myself AND buying homes for rentals. Buying rentals would get me on track with my end goal and be a better investment long term but it may impact my debt to income ratio and deplete the little money that I have now.

Thanks in advance!

Gabe