First Time Investor Looking at a Small Portfolio

[Tyler Kociencki]

Hi everyone, 

I've been looking to get into real estate investing for a while and I believe I have the perfect opportunity to do so. My grandparents have 5 SFRs, all rented out currently for $1k per month each (far below market rent, just self managed and usually my grandpa does the repairs). They've been kinda looking to get out of it for a while but aren't in a rush. I offered $625k for them all in as-is condition, which while they aren't super updated or anything, they are all in perfectly livable condition. Probably worth at least $200k each, even in current condition. 

The question is how to finance this portfolio. I have a reasonable amount of savings but nothing crazy. I do have about $80k in equity in my primary residence. Here was my thought: 

Cash out refi primary residence -> use funds to buy one property at a time and put 20% down ($25k for a mortgage balance of $100k) -> cash out refi property for a new loan amount of $125k -> use cash to put money down on next property -> repeat process on next property until all 5 are acquired 

Ideally I would be able to purchase all 5 at once, but just not sure of a feasible way to do so. I do know a seasoned investor that would possibly do some sort of hard money loan, but not sure. I would raise the rent to at least $1,250 on each property, so they would meet the 1% rule.

Just wanted to put this out there and see if anybody had any other ideas or general advise for this idea, thanks in advance!