1st purchase - rental or home?

[Sal DeJulio]

I am a salary employee in Florida who is currently renting a home. I'm interested in starting a scalable real estate investment business. Emphasis on scalable. I'm looking for very low money down options but I'm unsure of where to start, a home or a rental. The whole reason it is even a question is because I can use 75% of the rental income to offset my debt when the lender looks at the debt-to-income ratios, allowing me to purchase more properties down the road. If I start with a home, I won't have any more room for debt (unless I increase my income or remove some mortgage payments). What am I missing? 

[Adam Smith]

Personally, I would look at purchasing a duplex (or triplex?) and live in one of the units and rent out the other(s).  Basically, buy a rental and primary residence under one roof.  Find a deal where the rental income will pay either all or most of your mortgage...thereby living for free or almost free.  This will actually free up some income to invest in another property.  The loan will also be a typical (non-commercial) loan if it is a 1 to 4 unit property.

Some things to take into consideration 1) Living next door to your tenant; 2) Living in a multifamily (not sure if this is an issue for you).  Just make sure that you do your due diligence and know what you are buying (neighborhood, repairs, etc.) and rental rates.

There are A LOT of discussions on BP about this "strategy".  Search for "house hacking" and I am sure you will find more information than you know what to do with.