Starting Out
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated over 7 years ago,
Where to start my investing career: two options
Hi all! I'm a recent college graduate who has been saving up money and reading a ton of bigger pockets and am ready to get started investing in real estate. There are two markets that I am looking at, both have their ups and downs and I'm looking for a little advice as to which one is better for starting out.
First, some necessary information about me. I currently live in northern New Jersey (union county) about an hour away from NYC where I work. I currently live with my parents and would be happy to continue doing so to save money. I went to school in upstate New York and have many friends still there. I intend to manage whatever I buy myself and probably hire contractors for any bigger projects.
The first option I am considering is getting an FHA loan multifamily rental in northern New Jersey, roughly in the area where my parents live. I've found a lot of 2-3 family listings in my price range of 3-400k. My concern is I don't have a network set up here (though I do know some contractors) so finding renters might be difficult, plus I'd have to buy a car which is an added cost. Finally, I haven't run the numbers yet but I don't think the property will cash flow with me living in one of the units. Overall, I think it is a great opportunity to learn the basics of property ownership and renting in a comfortable location.
The second rental option for me is to buy single family homes in my old college town (5 hours away). The positives here are that I have connections to people who can find me student renters (with leases backed by their parents) and these things cash flow like crazy (by conservative estimates, 18% COC on a $20k down payment for a $100k house) and having college renters makes me resilient to downturns. The biggest negative is obviously the distance, plus these houses are in a very specific neighborhood that restricts the choices I have for expanding my portfolio.
I'm looking for any advice, some pointers, or even just a lovely discussion. Thanks in advance!