New Investor, First Plan! Opinion needed

[Account Closed]

Hey colleagues!

So I have my five year plan for starting out. I want to start very small since I have just bought my first house in August, got engaged, and will be having a wedding in July 2015, so lots of expenses coming up! Either way, I want to get started since I have the money, a great REA, and want to get rolling.

I was looking on the Home Paths website and saw a ton of great stuff on there! I love the idea of investing with 10% down no MI and all the other benefits of using the site. If I have the patience and the diligence I should find a sweet deal on there. The other day I saw such a deal and see if my strategy makes sense but it was already under contract (townhome that looked great in the area I wanted for $138k).

I want to get a townhouse for around $130-150K using the site (doing the various inspections and being careful about buying a foreclosure) in an area around 3M corp where I can rent it out to local young professionals who have just moved to the area (if the townhouse allows me to do that? Most of them allow investors to rent them right?). This will provide stead rent from good tenants who just got a good job with a good company. My question is what kind of investment is a townhouse? I could probably pay it off quickly which would increase my monthly income, allowing me to purchase more townhomes. The goal would be to buy 3-4 in the area and rent them all out before I moved up to a single family (or multi-family depending on how my money situation is) in 3-5 years.

Thoughts? Things I haven’t thought about yet? Things I’m forgetting? Things to be careful of with this type of strategy? I would probably buy and hold the homes if that makes a difference.

Thanks!!!!

Matt