I want to get into Rental RE Investing - Need Advice!

[Brian Dudash]

Hello! I'm new to the RE investing world and I'm seriously looking into buying SFH and/or multi-family that will end up being rented out.

Just to give some quick background about myself, I'm 26 years old and currently living in they bay area (though live most of my life in the mid west). I currently have about $115k saved up and I'm ready to start investing!

I've been watching/listening to people on Youtube, podcasts, etc where some say SFH is the best way to go, while others like multi-family or larger investments. I understand that this can and will be different person to person but I'm struggling with a few things:

• What is everyone's preference when it comes to SFH vs MF? Any personal experiences where you prefer one over the other?
• I'm looking at a few different areas in the Midwest and Southeast but I'm struggling to found out how "rentable" an area is. Like what makes one area better than the other and how can you confirm this? (Websites, RE agents, etc?)
• Since this would be my first rental property (and first property in general), is it best to put 20% down and use the rest your money to fund other RE investments or pay it off in cash and build up from there?

Any other tips or advice is appreciated!

[Ian Tvardovskaya]

@Brian Dudash I would make sure that you and your partner find someone local who you trust to manage or look after your rentals. A good property manager will make or break your investment more than the city. You may want to partner with someone local to make sure everyone has skin in the game. If you are looking for cash flow, then you should be investing in multifamily. For example, in Columbus if you pick up a $40-60k SFH you should expect it to be in a C class neighborhood and rent for $700ish/mo. A duplex in the same neighborhood should run $60-80k but the rent doubles. At 20% down you only need $2k more cash to close, but double your cash flow. In general, if you are looking for build, then you will need to either build slowly with 20% down and continue to reinvest your extra cash flow or find other ways to purchase properties. $115k is a great start, but it will be eaten up quickly in 4-5 SFHs between down payment, repairs, closing, and entity creation.