Looking for Advice on First Deal

[Brandon Wolff]

Background: I recently graduated from college (within the last year) and have been working and stockpiling cash. I currently have approximately $25,000 cash (held in a money market account). I am facing a few different scenarios and I am struggling to find which is best to delve into my real estate career. I am 24 and live in the Chicagoland area and desire to live downtown this summer. Any advice and opinions are greatly appreciated.

Scenario 1: My friends are asking me to move into an apartment. I know that paying rent is semi-foolish but I know that it would be an incredible time and memories that I’d have forever. I would then build my portfolio while living there and eat the ~$10-12,000 in rent per year.

Scenario 2: House-Hack and try to find a place on the North Side that is within budget. Only downside is that this is extremely difficult in Chicago given the current market and high prices. Realistically, to cash flow I may need to live in a surrounding suburb of Chicago or get lucky with finding an amazing deal. Or, just buy a beater and fix her up - however there really are no beaters in the Northern neighborhoods (e.g. Lincoln Park, Old Town)

Scenario 3: I would buy a 1 bed 1 bath apartment/condo so that I would at least build equity while still living downtown in the neighborhood by my friends. I would then be able to build my real estate portfolio from my own home.

Your advice is greatly appreciated in advance.