Seeking Guidance: Best Ways to Utilize $20k in Today's Market - Opinions?

[Phil Avery]

Hello to all, I hope you'll indulge me as I ponder some thoughts and seek the collective wisdom of the infamous BiggerPockets community. I'm on the hunt for general insights about optimizing a limited pool of resources ($20K)  in the current market, which, as we all know, is filled with complexities and various angles to explore. Here's what's on my mind:

1. Considering an FHA Loan for Primary Residence: Since I don't own a home and am presently renting, a 3.5% down payment through an FHA loan is appealing, even though it does mean higher monthly installments. My dilemma is the conflict between buying a place I'd enjoy living in versus something that makes for a solid investment. Should I consider converting it into an investment property after a year?

2. Acquiring a Duplex with an FHA Loan: This option would involve renting both units after a year, with the hope of a small positive cash flow. The fact that I might continue renting elsewhere doesn't bother me, provided the duplex doesn't drain my finances.

3. Aiming for Lower Cost Properties ($80k-150K): Going for a conventional loan on an SFR in this price range is tempting, but the difficulty in achieving cash flow in the current market makes me uncertain.

4. Exploring Distressed Properties (Foreclosures): Is it wise to hunt for under-market-value properties and handle title issues myself to boost profits? I recognize that I might need a partner, as full payment at the time of sale is typically required.

5. Holding Off on a Purchase: This option means continuing to analyze deals and building up my buying power for a 25% down payment on a pricier investment property. My hesitation here is the concern that I'm stalled and not moving forward.

6. Focusing Solely on an Affordable Primary Home: I could look for a reasonably priced home without considering profits and then save again for a second property purely as an investment, thus having more flexible criteria.

With these options in mind, I'm eager to hear your opinions on the most prudent entryway into real estate investing. If you have suggestions beyond these, particularly regarding what might be achievable with $20k, I'm all ears!"

~Phil Avery