First Property: Atlanta SFR, BRRR or Turnkey? Thoughts from Pros?

[Rob Barry]

Feelers are out for my first deal. I've narrowed to the Atlanta suburbs because the local economic growth outlook looks good and home prices are reasonable, yet rising. I feel a bit of FOMO for not having jumped in a few years back. Low-end properties appear to have literally doubled in value since then. My investor brain warns me that growth like this can't possibly continue for long, but things still seem undervalued (eg. new townhouse constructions are costing $110k-plus for what currently sells for ~$70k).

Long-term goal is to rapidly grow a portfolio of cashflow properties (SFRs and townhouses) under high leverage until my leverage reaches around 70% the value of my business, sell my business to clear all debts, and then shift into larger multis and commercial deals.

To keep things as automated as possible, I've plugged into a buyer's agent and property management team that comes highly regarded from friends who've worked with them for years. I've got about $80k cash set aside (income from my small business) comfortably for the first deal. Looking to leverage the cash for a discount on purchase price. I'm an American living in London and really don't want to self-manage properties and rehabs. 

Assumptions

My impression is that in the $70k-$80k price range, given recent rising prices of townhouses, a turnkey townhouse would cost more or less the same as the distressed properties in the comps after rehabbing. Slim pickings for real deals at that range. Conversely, I could save up bit more to target SFR foreclosures nearer to $100k all-in, and maybe find a nice equity boost for the HELOC, but at a higher risk of headaches. I could do the safe thing and start off with an already-rented vanilla townhouse and a mortgage for maybe $20k down and see if I need to learn any lessons. Or I could just go as big as possible from the start...

My questions to you fine ladies and gentlemen:

1) Are my assumptions on-point or off-base from what you've seen

2) Which approach would you start with

3) What do you think about the growth outlook in rental demand for townhouses vs SFRs in the burbs around Atlanta?

4) Any general advice for reaching my goals and avoiding pitfalls?

Thanks so much.

[Dan Mahoney]

@Rob Barry I live and work in Atlanta and share your optimism about the outlook for residential real estate in the area.  My advice to an out-of-state investor would be that your choice of agents (including property managers) is WAY more important than your choice of asset type.  If you have a good team, you can make money with any of the investment strategies you are considering.  If you have a bad team, you are cooked from the moment you wire the funds.  Of course you won't know for sure if you have a good team until you are a couple years into a deal...but if you have personal referrals from people you trust, that is about as solid data as you are going to get.