Start now or wait for more cash for down payment?

[Grace Tansipek]

Hi, I am thinking very hard about diving into real estate investing for the first time, but my situation right now is that I currently still have a mortgage on my primary home which I plan to sell in 4 years when my son finishes high school (have about 200K of equity from this home). If I buy an investment propert now I will have to put in around 20 to 25% down payment, and I do have a bit of savings but feel like I can only risk letting go of around 50K from my savings, especially since we are new to this. With that amount, in my area, the choices of investment properties that I can afford is pretty limited. If I wait 4 yrs, I can sell my current home and either use the equity to purchase an investment property, or, if I want to keep the cash, I can house hack and purchase an investment property as “owner occupied” which can possibly lower the down payment to as low as 3.5%. Is it advisable to dive in now (as they say, the best time to start investing is now)? Or is it best to wait? Thank you in advance!

[Vadim F.]

Where are you located and where are you looking to invest? I am in the same situation and looking in RE investing but based in the Bay Area there aren't any options. I am looking at OOS, have been looking at Cleveland and Detroit. In these areas you will be looking at rehab properties that will need to be bought for all cash most of the time but after renovating and getting tenants in place, can do deferred financing and pull out majority of your money invested and get solid cash flow. I have been chatting with @Travis Biziorek and he has been providing me with great advice on the Detroit market and how to operate in it.