All Forum Posts by: Melanie Collins

Hi Melanie-

A great question and a great position to be in, congratulations!

Someone once said, who was a member of this community, that owning 1 paid off property that yielded cashflow similar to four properties is much preferable because you only have the maintenance and management of one property.

I heard that and found a lot of wisdom in it.

Thus, like Occam's razor theory, the solution with the least moving parts with similar outcomes is preferable.

One last thing I would consider is using a property manager even if you are staying in the multiunit. You can act like just another tenant and it makes your investment more passive which should be your ultimate goal.

To your success!

Real estate is a great way to build wealth and create income if you do it right. As a beginner, I'd suggest taking it one step at a time. Investing in one property at a time may help you get everything set up correctly and give you the spare cash for necessary fixes and maintenance. That way, you can ensure success as you move forward with your investments!

Good luck on your real estate journey!

 ...If you wanted to get really crazy with it, you could house hack the house hack by buying a property that had space & hookups for your van, and living in the van while you rent the rest of the house...

Definitely start small, even one property to "learn the ropes".  I was looking at originally purchasing two properties at the same time for our first properties, but quickly realized it would be a more financially sound decision to start even smaller.  This was all after researching the market in my area and listening to Bigger Pockets for a few years.  Turns out we were right and found a totally different third property which we ultimately invested in.  Tenants will be moving into that property on 03/01 and we'll be turning a profit of over $2,000 every month.  It certainly pays to think outside of the box!  Best of luck!

I buy single family houses and getting them at a discount is a great plan, always.  We also get capital gains tax benefits for remodeling our own residences and holding for two years.  You could do that, move to another primary residence in 2 years, and have a nice tax-free lump of cash.  Buy another fixer as a primary with a portion of that money, and a similar rental.  I like probate houses for a bunch of reasons, but they usually have the right things wrong with them, such as old smelly carpet, but good structural condition. I can improve landscaping, put in new flooring, paint and so forth using Home Depot and get it done over time.  Look at the houses in my bio.

Food for thought, the 5 unit and up space is difficult to get funding for.  I suggest you look up the 5 units in your area on the tax assessors/recorder's site, handwrite and mail those owners and ask to buy with seller financing.  I would offer 5% interest only payments with a small down payment.  See where that goes.

Thanks @Evan Kraljic. Both these scenarios an explanations helped a lot as I see now I need to consider initial equity from a under the market value property with a low down payment. Thanks!

This answer completely depends on your situation and long-term goals. The easy answer in real estate investing is "more properties/more leverage = better". However, when you dig into it, that might not be the case. Are you financing these or are they all cash? How much cash? Are you living in the property? What's the strategy (BRRRR, LTR, FLIP, BRRRSTR, etc)? Feel free to DM me more details and I can give you some advice based on your situation and can speak to Tampa's opportunities that may or may not be a good fit for you.

Ha, how funny that the market in Denver is shifting yet again... I thoroughly enjoyed taking advantaging of steep discounts, rate buy-downs, inspection items, etc. over the fall/winter, but alas, I think we're headed back to the days of yore. Anywho, do you plan to live in the property or purchase it as an investment? Lately I've found the #s on a SFR and duplex are much more do-able than the #s on a tri/quadplex, and if you house-hack, they are far more digestable if you house-hack as it's the lowest cost of entry. I personally liked starting small with a SFR we lived in, it gave us time + space to make mistakes and learn from them. I'm happy to set you up on an MLS search if you're interested, I've got a couple going right now looking exclusively at SFRs w/house-hack-ability (i.e ADU, lock-off, etc.).

As a beginner it is always best to start small and learn your systems and get them in place for managing the property. If you plan to eventually be going for the larger units and are committed to learning and managing the property successfully then I believe you will be fine going for the larger property. 

Hey @Melanie Collins! Great to hear the sale of your home went well and sounds like you are enjoying your time in Mexico! As some others have mentioned, this completely is subjective. There are pros and cons for each avenue. Starting with a smaller property first will allow you less risk, and less exposure if something does come up, or the investment doesn't work out. But a multifamily is the simple principle of economies of scale. Having multiple units under the same roof makes management and maintenance easier.

From your post, it seems you are looking to minimize your loan balance and utilize your capital. Personally, if you are planning on coming back to the Denver area, I would think about another owner-occupied property to take advantage of the rates and low downpayment. It will allow your capital to go further overall. Could get a smaller duplex for yourself and then look at other investment opportunities.