Sequence of Rental property Purchase

[Wei Jie Yang]

Hi guys,

Looking for advice on the topic of sequencing house purchases.  I have Purchased two rentals so far. Should close on two more by end of July.  I've so far limited my purchases of $100K+ SFH, that can rent for $1000+ that I hope can appreciate over time due to them (mostly) t being in good/path of progress areas.   Now I'm at a point where I am thinking whether I should aim for more expensive or more affordable housing stock.

With conventional loans as of this week, I am able to do 15% down and 5% interest rates with no points. It seems like a waste to have terms that good for a property that is 60K-90K,m even if COC% are better. I'd rather get a 120-200K property that cash flows and I would save and focus properties on that level until all 10 (or 20 if my wife goes back to work).

I can look to the 60-90k houses once I get pass my Fannie/Freddie slots and have to resort to portfolio loans. Since Portfolio loans typically needs a higher downpayment as well as higher interest rates a cheaper house strategy then will be much more efficient then doing now. 

Does that line of thinking make sense if i am mostly aiming for cashflow (with a bit of appreciation down the line)? Is there any flaw in this strategy (other than speed of scale?)