What’s best for first investment property?

[Laura Srocki]

What’s your opinion?

I'm thinking a single family residence where I'm all in at 75% ARV. Then to refinance/ put a mortgage on it and be able to recycle the money I put in. ( BRRRR) Oh and I'm only starting out with 50k cash 😂 and maybe 40k heloc. Although I would not max out the heloc, I'd rather keep it for emergency use only.

Then then use the cash out to put a down payment on a duplex then maybe a four plex etc. I’m only trying to accomplish a min 3k monthly cash flow to eventually be able to retire in 10 years. In the meantime reinvesting the cash flow or building reserve. 

My thinking is a single family under market value and be able to add value might be the best starting point rather than starting with a duplex or some other smaller multi family since a single family is easier to appraise etc

[Abel Curiel]

Hey @Laura Srocki,

I'd go with the small multi-family as a first investment. You'll have all your expenses under 1 roof and you'll earn rental income while holding onto it. In many markets, a property at or under 75% ARV will see a lot of competition from cash buyers.

If you choose this route, it may be best to work with a buyer's agent who can help you prepare and negotiate your offer. 

My first investment was SFR where my only strategy was to fix things up a bit and bank on appreciation. While it certainly appreciated (I purchased in 2010 and the property is walking distance from NY's LaGuardia Airport), I did not earn any cash flow on the property. The same down payment I used on the SFR could have gotten me a MFR close by.

As for it appraising "easier", I'd like to hear more about that. I'm not sure I fully understand that statement.

Best of luck to you!

Abel