Needing Some Guidance

[Cody Hensley]

Hi fellow BP'ers! 

I have been a lurker here for quite a while and decided I would jump in and get my feet wet! I am a newer RE agent here in Colorado (2014) and have been wanting to invest in rentals. I currently do not own a home and I have a fairly favorable living situation so house hacking wasn't in my sights. However I am getting eager to buy my first investment. With that being said, here is my current situation and hopefully someone can steer me in the right direction. 

For income I am averaging $11k/mo. in commissions. So some months are $21k and some are $5k, but no less than $5/k month.

My credit thankfully is coming up. I am at roughly a ~660 FAKO score depending on the website who pulls it. I have 3 unpaid collections that are due to drop off in 2017 and I don't really want to pay them since I have waited nearly the 7 years for them to go obsolete.  

I am slightly afraid to purchase in this market because of the inflated cost of single family. I don't believe we are in a bubble since lending has tightened up since 2008 and the inventory is really low. 

I have thought about storage units also, whether it is buying one or buying the land and building. Someone always needs storage.....

Any guidance or encouragement you can send my way would be greatly appreciated!! 

[Bill S.]

@Cody Hensley welcome. Each person is different but I think waiting until 2017 to buy is going to be fairly costly to you. Interest rates will likely increase and it looks like on all fronts the price of property will also increase. Think about a $400,000 property increasing just 5%, you have lost $20K. Are your judgments more than that? If not, pay them off and buy. What if interest rates increase just 1%. Your payment goes up about $300 per month, for 30 years. Is that worth the wait to see the judgments drop off. Can the judgments be renewed? If so you have lost out and still have the judgment. 

At any rate. I love storage but it's a business as much as an investment. As for building storage, you then are a developer which is another business to learn. Find a small one to buy and learn on. I don't know too many that are for sale.