First Investment Property

[Takira Smith]

Hello,

I'm very new to the investment world. While I have spent the last six months doing research concerning real estate investments, I have yet to actually purchase my first property. Although I have been doing a  great deal of reading and speaking with others, I have yet to get an answer I guess I am comfortable with. I prefer my first investment property be a first family home fixer upper. I would like to know, how much money, on average, would I possibly need to buy my first investment property? Thanks!

[Nicole Pettis]

@Takira Smith You will have to get pre-approved first to find your answer. If its going to be your family home. You need to know how much you can afford and then go from there.

You need a strategy as well. Are you going to flip or is it going to be a buy and hold, because depending on your direction will help you base your price. 

For example, I want to flip, so when we bought our house it was a foreclosure, then I used the flip formula to put in an offer price(ARV X .70 = amount - rehab cost = offer price) however the offer price had to fit the amount we were pre-approved for. We also used a 203k reno loan to help with the expense of the rehab.

If you want to do buy and hold. Then you might consider a multi-family or duplex. Something you can live in for a little bit, while others pay part of your mortgage. Save yourself a little nest egg and then move onto your next property after a few years. 

Because of all of these variables, that is why its difficult for you to get a straight answer. We don't know how much you can afford, only you know that answer.

Hope this helps!