All Forum Posts by: Nicholas L.

@Sherree Ruston no, you don't 'need' to get started with wholesaling.  And if you don't have the 20%... can you just wait until you have it saved up?  There are lots of expenses associated with owning and operating any type of real estate.

@Joseph Dozier can you house hack instead?  Save up some money and buy a small multi that you live in.

@Jamey Meints will you be hiring a property manager or self-managing?

@Matt B. it's not great, paying for property management would take cash flow to 0 so you're counting on being able to increase rents.  I know you said "worst case scenario" but it's smart to run the numbers conservatively.

@Saemi Jung let's back up - have you picked any markets and started looking at any actual properties?  Are you talking to any banks about financing?  Are you actually working with / talking to one or more agents?  All of this is going to be very deal specific... but as you can see the community is skeptical about the combination of no cash flow + counting on appreciation / building equity.  Thoughts?  What are your immediate next steps?

@Sathiya Deva find a good CPA and a good agent and get their guidance.

@Brian Roth a few questions - 

On option 1, are houses costing $325K really cash flowing well?  Have you run the numbers?  Buying on-market with conventional financing just isn't going to get you that good of a deal right now.

On option 2, I think what they might be trying to say is that, in order to qualify for owner occupant financing on a new property, you'd have to live there. Is that accurate? Or do you have FHA financing on your existing property? If not, you're free to take out whatever kind of loan you like on another property.

And, if you moved out, would your current home cash flow?  

Lots of numbers to run here.

@Roy Peer setting aside for a second the strategy, which I agree is a gamble, would these really make good rental properties? You stated that rents are $500 above PITI - but PITI is only a portion of the expenses of owning a rental and does not include many other expenses. In theory, if a house is brand new, there will be less capex and repairs, but they won't be $0, and new builds don't always make great rentals because they tend to be at higher price points. Can you post a complete analysis of a rental?

Also, in the words of Tony Stark, "pulling out a contract" as backup: not a great plan.

@Lance Bolen welcome.  You will have to decide yourself whether to go to college or not, but the strongest possible position you can be in to invest in RE is as follows:

1) get a W2 job (makes you bankable)

2) minimize your expenses and max out your savings

3) house hack

4) repeat Step 3

If you haven't already, check out books on house hacking and saving as much as you can.

Good luck.

@Brett Kingston to build on something @Evan Polaski said, do you have any savings?  You mentioned "changing your lives..." - there's also being in a strong financial position now such that you can manage any bumps in the road.  What if you made a case based less on what is years away, and more on the different possible outcomes now?  For example, if you don't have any savings and your plan only works if everything goes perfectly... that's not very compelling.  How does this fit in with your current job, where you want to live, your reserves, your overall retirement plan?  Do you have joint or separate finances?  Do you own or rent now?