New investor, seeking advice and basic steps

[Shane Short]

Hey everyone, I’ve been on BP for a bit now and have been loving it. It’s really inspiring. I come from a very financially free family, and I’m looking to do the same with my life. I want to share my goals with you all and see what you think my next steps should be. I’m currently 22 years old, living in Portland, OR. I only have 6k currently to start. But my goal is to save until feb. and hit 12k to start investing with. I’d like to buy a MFR, hopefully a triplex, and use one of the units rent for the mortgage, 1 of them as profit, and one unit to live in, virtually free, making it possible for me to save even more not having rent. Then to save 20k and use it towards my first house flip, or another passive MFR. I have a very stable well paying job. And I have 3-4 days off weekly, making it easy for me to focus on other avenues, until I can build enough revenue to quit and invest full time. I come from a family of builders and can do most work my self involving reno. I wouldn’t do the stuff that requires licensing come time to sell, such as big electrical, etc. I’m from Michigan originally, so buying homes here that are 8 times what they would be worth back home, kind of hurts my soul. - Given this information, do you think I’m getting ahead of myself and need to save more? Or do you think the REI is something I can actually pursue this winter like I’d like to? - Should I consider out of state investing back home where I have a multitude of resources, and maybe get a much cheaper triplex or MFR there for passive income at a much lower price to start out? - What else do I need to be doing? And also, how do I find meetings in my area? - Any advice for a young buck getting into the game? Best Regards, Shane Short

[Nicholas Sheridan, Jr.]

@Shane Short When you are looking at MF properties (at least in my area) it is nice if they cash flow but since you are occupying 1/3 of the units you should understand that 1 unit alone is not going to cover your mortgage payments. If you can get the other 2 units to at least cover most of your mortgage expense then you are golden because you are essentially living rent free while your tenants are building your equity in the property. 

Given this information, do you think I’m getting ahead of myself and need to save more? Or do you think the REI is something I can actually pursue this winter like I’d like to? 

- You should reach out to a lender and start crunching some numbers to figure out how much cash you need for the down payment. I just did a comparison myself of the pros/cons associated with FHA vs Conventional Loans.