Thoughts on Buying for Cash Flow vs Appreciation

[Cristian Cedacero]

Hi all! 

tdlr: I have a unique opportunity here of not paying a down payment or closing cost and not sure if I should take advantage of this and buy a more expensive property or settle for a cheaper property. My ultimate goal is to buy multiple units.

I was approved for a NACA mortgage where I don't have to put down closing costs and can get up to a 2-3% lower interest rate than the market.

I'm thinking of buying a multi-family to live in a unit and renting out the other 2 units. The problem is I'm having trouble deciding between buying in an expensive market like NYC /NYC metro area where 3-family homes go for like a minimum of 999 in the Bronx. Since NACA allows you not to put down a downpayment and no closing costs I wouldn't have to worry about that even though I do have money to cover rent for a while if things go wrong.

The problem here is that based on numbers these units will be hard to cash flow with such a high mortgage but because is NYC/metro I'm sure they'll appreciate in value. The other option I was thinking about is buying further out of the city in the capital region where I can get a 3 family that may need a bit of work for 250K+ or one in k shape for 320k+.  Rent is much cheaper in those areas at around 1k - 1.4k depending on units but these are much more likely to cash flow. Especially when purchased through Naca.  These units will most likely not appreciate much but will cash flow when compared to the NYC area market.

What are your thoughts? Thank you!!!!