If you had to start all over again, what would be your strategy? I would have bought a 3 or 4 family with an FHA loan and used the left over money from my down payment to do a small flip; I then would have kept the money from that flip rolling into as many flips as I could do within 2 years. After 2 years I would move out of the 3 or 4 fam and purchase another multi family (you qualify as a first time home buyer for mortgage purposes every two years) and done the same thing as above. After another two years I would have bought my house to live in, by this time I would have at least 5 rental units and would have financed my down payment for my primary residence through the flips. I would borrow as much of the money as possible every single time in order to get maximum tax benefit out of interest payments.
Would you start with a turnkey property?
Begrudgingly, I would be willing to start with a turnkey property as described in my answer to question 1. I am generally opposed to paying full price for a property, but if I had to do it all over again I would use my money much more efficiently by getting a low money down loan & using rental income to pay down my mortgage and subsidize me. All money is to some extent binary.
Would you start with a BRRRR or Flix and Flip strategy?
I would stay away from BRRR until I had some experience with lenders; check out the forums, there are posts on a daily basis from people that tried BRRR but do not know how to refi out. Check my answer on number one for the balance of this question.
Would you start with Wholesale?
Only if I didn't have enough money to put the 3.5% down to get the first multi family. I actually did not have any money at the very beginning, so I became an Agent to generate income - I became a successful Agent and used the earnings to do my first deal.
Market area:
Would you try staying local for your 1st deal or go OOS?
Local. Stay local until you understand how markets function generally. General knowledge is underrated, most people give weight to excessive expertise... I think general knowledge helps you filter; by filtering you can make better decisions. Having a general knowledge of how properties are rated helps you stay away from a 4 family on your first rehab; 4 family properties are generally considered commercial properties & have altogether stricter and more expensive standards. I have seen lots of inexperienced investors jump into deals that look good on paper, but if they had working knowledge of markets they would have stayed away from the deal in the first place. An business acquaintance is suffering through this right now and the consequences of the decision are going to be significant.
States (TX, OH, KS, MO, TN, AL, GA, IN, PA, CO, NC, SC, etc):
What states have you been most successful in?
Stay local at first. We have invested out of state, but its our neighboring state of CT. We will do more in the future, likely FL and TX but overall simplicity is best at first.
