I am Pre First-Deal and only have an 8% HELOC to use for a DP

[Kevin C Means]

Ken McElroy says sell off all of your non cash-flowing assets; the market is not great; I must invest out of state; and I only have a HELOC, costing me 8% to use as a down payment. What the heck do I do, who do I trust, and what is the best bet other than to wait and do nothing?

There is not a deal out there that will cash flow for me, but I am afraid that if I do not get in now I will regret it later when everything goes up, as it always does. 

Should I find a deal that comes as close to zero as possible, even paying for negative CF with my W-2? Would that ensure that I get something before things get even more risky, and cash flow is even less achievable? 

[Josh Young]

@Kevin C Means negative cash flow is not ideal for most people, but you are right if you have the w-2 income to cover then you could invest for equity growth which will also mean future cash flow growth, but that means you need to invest in a location that has population growth and job growth, we have both of those things here in Arizona. If you are looking at new builds here I really like Florence and Casa Grande; Coolidge and Maricopa are good too. If you feel you can cover the negative cash flow with your w-2 for a few years you should be able to refinance into a lower rate in a few years and if you have rent growth you should be positive cash flow at that point. There are more ways to make money in real estate than cash flow, in my experience cash flow is one of the smallest parts of the overall return, but if you don't properly manage your cash flow then you can crash and burn, so make sure you have access to at least 6 months of PITI payments as reserves.