First Time investment property buyer

[Johb White]

First time investor

Looking for advice on purchasing my first rental property. I live in Tallahassee, Florida and am particularly interested in foreclosures. There seems to be quite a few foreclosures in the area that wouldn’t take a huge amount of work, mostly in need of a new roof (not leaking) or a few minor updates. I feel confident in doing most of the repairs myself because I am fairly good with these types of things. I also have a lot of friends in construction that could give me advice and help me out. I am unsure of what kind of property I should be looking for. My first idea was to purchase a new home out of the city for me and my wife to live in and then rent our current home. Our current home should rent for right around $700.00 monthly. My wife suggested that we stay in our current home for a few more years and buy a cheaper investment property to rent. If we are to take this route, I am not sure what kind of property I should invest in. I hate financing anything and have around 30k saved to buy a property in cash, which is sufficient to buy a small single family home or 1 side of a town home in foreclosure that is in a decent location, and have it rent-ready. I know I should probably finance the investment so I could get a property with a higher rent and I have excellent credit but I hate to finance anything. Buy buying the property in cash I may be able to get it for a lower cost and I would also avoid the fees associated with financing. I do not intend on renting properties as my job, just extra income. Of the properties I have considered I should be able to rent for around $650.00 monthly. I figure I should get {$650.00(rent) x 11 (months (subtracted 1 month vacancy))} - {$300.00 (taxes, insurance and upkeep) x 12 (months) }= $3,550.00 profit annually (11.8% on 30K investment).

My main concerns are what type of property? Single family home, part of a townhome, Condo to rent to students (big college town). I am not particularly inclined to get a condo because of the competition though. I also would not consider buying an entire townhome and living in 1 part of it, my neighbors would hate my motorcycles, boats, other loud toys. I would hate to have me as a neighbor.

Should I pay cash in full (which is what I want to do) or do I really need to finance?

Should I avoid renting to students?

Potential non-obvious pitfalls of foreclosure properties?

Does my math seem feasible?

Thanks for any advice.