What strategy did you use to buy your first investment property?

Question

I'm new to real estate and learning still. However my goal is to purchase my first investment by next summer/fall. I would love to hear the process you took to get your first property and the strategy (ie. saved up, partnered with someone, rent occupied, etc).

Thanks!

Steven Foster Wilson · Answer

@Michael Craig I saved $10k. Asked my Grandma for 15K and bought my first duplex with an FHA 3.5% down loan. I ended up rehabbing the property, adding 2 beds and 1 bath to the duplex and refinancing and cashing out. I cashed out 75k (30k to pay off my renovation debt, 45k helped buy my second property)

This photo is just one example of the renovation. We moved the front door so we could add a bedroom. After all the appraisal on a duplex is all about bedroom and bathroom count.

Dennis M. · Answer

I Sold my body At interstate rest stops till I saved up enough for a down payment .

Actually I saved from a year of my overtime and then took out a personal line of credit from my credit union combined and bought A old triplex in cash

Melissa Nash · Answer

What ever is the fastest! If you have $ saved up, then go for it. If you don't have $ for the loans, they you will need a partner.

Step 1. talk to a lender.  Do you qualify for conventional or not? What is required for the loan? You need to know how you will qualify first.

#2 Market strategy- Are you buying in the market you live in or out of state in another market? Pro's /Con's to both. How long do you want to hold property? Long term, or short term, the market you decide on will affect this and your goals. Some markets cashflow higher, and some have more long term growth.  Start looking at markets and seeing what is out there. Do you know construction, can you rehab? Or are you more of a passive buyer, willing to buy in another state where everything is done for you.(AKA turnkey). What is your time? and what are your risk levels?

#3. What type of asset class? SF, MF, etc. Decide 1 for now based on the above and $ you have.

#4. Whats your goal? Wholesale? Flip? Hold, house hack, rehab, etc.

#5 Decide these above and then the money will come. You can always find partners, or lenders, etc. But you need to set your goals first.

Best of luck.

Jaron Walling · Answer

Saved some money, paid off an auto loan, and sold my motorcycle to start the journey. Conventional loan, 3% down, distressed property, live-in flip. Depending on market conditions I'll sell or rent it out and cash-flow based on numbers.

Joseph Firmin · Answer

Saved up, cashed out my rollover IRA, used part of my work bonus and took equity out of my personal residence... whatever it takes. Then went in one day and took out 5 personal credit lines from 5 different banks to have just in case. I bought a duplex with a conventional loan, 20% down and proceeded to renovate it. It is a BRRRR property with 80% of my cash out.

Jaron Walling · Answer

@Alex Rodriguez  Purchased at $83K, ARV $120-125K, or rent for $950-1000 per month.

Dwight Robinson · Answer

Since I went to college for free, I used a student loan for a down payment on a duplex. It already had tenants. One with section 8. This was back in 2005. I still have the section 8 tenant today.

Brendan O'Donoghue · Answer

I lived below my means for just over a year, saved as much as I could, worked as much as I could to have enough for a 20% down payment on my property. My next property will be using a partner / private money lender for a much larger scaled multi family property and house hack using an FHA loan.

Oh! And listened to and read as many BP books, podcasts, and forums as I could.

Kyle Mitchell · Answer

@Alex Rodriguez For me it was the old fashioned way of saving up and purchasing my first single family rental.  If I had to do it over again I would learn how to use OPM (other peoples money) sooner so I could leverage and scale that faster all while helping others accumulate wealth as well!

Joseph Firmin · Answer

@Alex Rodriguez - Read the book by @David Greene, that's the best info you'll get.

What strategy did you use to buy your first investment property?

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