MFH Cost/Benefit analysis: Should I go new or old?

[Corbin Wafford]

Hello!

I have run into the following issue and I will do my best to try and keep this predicament as short and as simple as possible. Keep in mind, I am currently looking to house-hack and purchase a MFH with an FHA loan (at the moment).

Succesful and experience investors, if you were presented with the following predicament, which option would you rather pursue, property A or property B? Why?

Property A): 

-Very well maintained MFH in a very good/growing area

-Very low maintenance/repair cost

-Extremely low vacancy rate

-Has the potential to make for a great rental property long term.

-High rents, aka, likely white collar/respectable tenants

-Not many of these opportunities available, so if I miss this, it may be awhile until another one presents itself

-Presents me with more time to save funds, educate myself, etc.

Issues associated with this purchase would be larger down payment, little room to add value to the home, and I would likely (considering all expenses, PMI/MIP, and mortgage) not break even or cash flow while owner occupying.

Property B):

-Older MFH

-Not nearly as expensive

-Requires work (rehab, renovations, repairs/maintenance), etc.

-Will bring on headache/stress/discouragement

-Potential for bad tenants at lower rent rates

-Not in a prime growth area

I am not opposed to this property, so please do not assume that all the negatives associated with property B are me trying to justify that property A is better. There are several pros that are associated with this property that I have come to understand:

-Great learning experience

-Has large potential to add value

-Likely has ability to cash flow (by raising rents with each addition to the home)

Please let me know your thoughts on this if you can. I am currently brainstorming and trying to develop the best cost/benefit analysis I can before making a decision. Would love to hear your (the community) thought's on the current matter!

Thanks!

Corbin