Newbie starting out (Dutchess County, NY)

[Andrew K.]

Hello everyone, 

I'm just starting to look to buy residential single-family/duplex housing in Dutchess County, NY (NYC metro area is priced way out of my league). The area isn't particularly high-growth, but has quite a few Fannie Mae/bank-owned foreclosed properties that are trading at interesting price ranges. I'd be partnering with a friend who lives in the area and has construction/contractor experience. I just had a few quick questions: 

1) Would you suggest creating an LLC for my friend and myself to hold the property? I've read that for a single family/duplex housing unit, it may not be worth the hassle, but am curious on what people think about this point and on an operating partnership, in general

2) Would we be able to get a commercially-reasonable mortgage on a first-time investment property that will also likely need to be repaired to some extent? The properties in our target range are realistically going to need to be fixed up cosmetically, but we're absolutely avoiding any properties with significant structural issues. For further background, I have a top credit rating (above 780) and our combined annual income would likely be worth over 3x - 4x the mortgage value (even before taking into account any down-payment)

3) Does anyone have any experience or opinions on investing in the local area (particularly in the residential real estate side)? I know everyone prefers higher quality locations, but those areas are quite frankly way out of my ability to acquire and the investment ROI doesn't add up unless I take a lot of debt financing (which incurs even more downside risk-- solve a problem; create a new problem issue). My whole goal is to get a buy-in price that's attractive enough that it boosts my margin of safety

4) Is there anything about investing in a bank-owned foreclosed residential property that should deter newbies? I fully expect there to be repairs to be made and I will be sure to bring on qualified home inspectors to thoroughly vet any investment property, but I don't see many newbies/discussions about this particular style of investing in the real estate market

5) Finally (and the catch-all), is there anything I'm particularly missing? Obviously deal-specifics will be the make-or-break factor in deciding whether to proceed with any investment, but I would appreciate any overall advice to help me clearly think through the risks and rewards of any potential transaction

Thank you very much for your help. I've enjoyed reading the other posts in the forums and the articles as well.