Trying to Figure out Where to Start

[Peter F.]

How would you start investing if you and your wife had $100,000 to invest in SoCal? Note: she wants a yard for the dog and a decent neighborhood for primary residence. We're open to moving and/or purchasing out of state. 

[Dan H.]

Originally posted by @Peter F.:

How would you start investing if you and your wife had $100,000 to invest in SoCal? Note: she wants a yard for the dog and a decent neighborhood for primary residence. We're open to moving and/or purchasing out of state. 

 I would start by looking for historically high appreciation areas (areas that have appreciated well for durations as long as 50 years) that I would desire to live.  Then I would verify that nothing has changed to make that location unlikely to continue to appreciate.  

I would then look for a detached duplex to quad that has one unit appropriate for your family. Detached puts distance between you and the tenants which I recommend. I would use an owner occupied FHA loan to purchase the property with low money down keeping some cash for reserves. I would then house hack the property referring to myself as the property manager.

If the property has an opportunity for forced appreciation that would be bonus.  

Using an FHA loan you can purchase a nice (expensive) property with little down that has a great record of appreciation in an area that you want to live and in a unit you want to live. You want a good home for your family.

Meanwhile the other tenants will be helping pay your loan (ideally partially supplementing the cost on your unit).   Finally you will be learning about investing, property management including dealing with tenants, repairs, etc.  This experience will provide you the opportunity to determine if buy n hold is an investment option you want to continue with.  If you do determine that buy n hold is an investment option you want to continue with, the knowledge gained will allow you to be able to have the next purchase be even more profitable.  

Good luck