Atlanta Flip or Lawrenceville Buy-and-Hold?

Question

Hello All,

I am relatively new to BP and wanted to seek some advice on the Atlanta market for those of you that are in the know. I am currently gearing up to purchase my first property and I am having trouble narrowing down which direction to take. I love the idea of a buy-and-hold duplex, however, they seem to be scarce in the Atlanta area. I believe that I could possibly find one further out, like Lawrenceville, Duluth, etc., however, I am not very familiar with those areas which scares me a bit. My other option is to scratch the multi-family idea and focus on doing a flip closer in to town (likely NE Atlanta or possibly Smyrna). Does anyone have knowledge, advice, experiences that they would like to share that may nudge me in one direction or the other?

Shane Short · Answer

@Danielle Leahy Absolutely! I'm so glad I was able to help! Don't be afraid to hit the "Vote" button on posts you like, it helps us stand out and let's people know if our information is valid, helpful, and trustworthy :)

First post on BP?! Post a lot! Letting us help you helps us. The Roman Philosopher Seneca said, "As we teach, we learn."Teaching someone is literally the best way to learn something, whether it's helping you analyze deals, talking about financing options, networking etc. I'd recommend taking anything you learn and try teaching it to someone you know for fun. It makes it solid.

It's an easy industry to get side tracked in. There are SO many fun avenues available lol. And it always seems like the grass is greener on the other side no matter what side you're on, Flips, Buy and Holds, Wholesaling, Options, etc. but there are crazy success stories in all of them.

I would highly recommend @Brandon Turner's "The Book on Rental Property Investing". If I could only have 1 book to read before investing in Real Estate, that would be the one I'd want. It prepares you from start to finish, helps you develop a solid game plan, discusses financing options, team building, etc. and if you buy it on kindle you get the audio version for free which makes it even easier to read. Plus he writes it like a normal guy and not an English Professor, so it's a fun read. It really helps to keep you on a path and not get sidetracked. If you read a chapter or so a day you could have it done in like 2 weeks and it will literally change the entire way you go about doing Real Estate and potentially save you thousands and make you millions in the end.

Anyways, I'm done ranting lol. I wish you the best of luck! I hope to see you around the forums!

Regards,

Danielle Leahy · Answer

@Shane Short, Thank you so much for your amazing reply! This was my first forum post on BP and I am blown away by your generosity of time in preparing a response. I know you are right...I need to get back to my goals. When I began formulating this plan, I set out to purchase a buy-and-hold. I believe I got sidetracked by various people throughout my education process and the flip started to become the "shiny object" that could easily derail me. Also, you are so right...a rental BRRR is capable of being a flip if I decide to go that route. Thank you for resetting my intentions. :) Much appreciated!

Shane Short · Answer

Morning @Danielle Leahy!

I'm buy no means in the know as far as Atlanta goes, I'm literally on the other side of the country lol... However, I would say that you should come up with a solid game plan of what it is that you are hoping to gain from Real Estate? Are you trying to gain financial freedom in the long term? Are you trying to get a few properties to set yourself up for retirement down the road? etc.

Once you know what you're looking for, ask yourself what the path of least resistance is to get there. If you're trying to build financial freedom, and get monthly cash flow, I would do the rental option (I am however biased towards Buy and Hold). If you're not going to be living there, and location isn't as big of a deal, then go where there is a good cash flowing opportunity, and find a solid Property Management company to manage the property for you. Then Refinance, and repeat! If you are in a market where houses are predominantly cheaper, and the market is growing, then maybe Flips are the way to go! Flips are great if you have deals available that make sense, and you are looking to gain more capital for bigger investments.

The reason I don't like flips though, is because with flips you are creating a job for yourself. Once you sell it, you have to find the next property asap, or your cash flow stops coming in. With Rental Properties, you can build your portfolio as fast as you want, and you are constantly making more and more money each month as long as you are purchasing good deals. Those good deals can be the same deals you'd find for a flip, that's literally what the BRRRR strategy is. The difference is that those flips will pay you for the rest of your life, plus you gain equity build up from your tenants, cash flow, and any value the market adds. Then once you're satisfied with your monthly income, you can literally stop and travel the world, live on a beach, do whatever you please, or you can just keep going at whatever pace you'd like/ need. Then there are enormous tax benefits, etc.

The best part about rentals is that eventually those mortgages are going to be paid off, and you're not just going to be cash flowing 150-500 dollars a month from them. Not only will you have a home paid off by your tenant worth whatever the average house is worth in your area, but your 4-500 dollars jumps to 1,200 dollars or whatever the full rental price of that home is. Your cash flow literally doubles, triples, or quadruples, especially in MFR situations. Leaving exponential wealth for you, and the generations after you, or charities, etc.

This is just my two cents though. Go with whatever gets you to your end goal, and whatever makes you the happiest in the end, because really that is all that matters. :)

I wish you the best of luck with your journey, and can't wait to see your success stories on here! Like I tell everyone else, ask, ask, ask, and ask, and when you're so tired of asking your head hurts, ask some more. There are so many awesome people on this site that want to help you. People love talking, sharing stories, and experiences, you're in the perfect place!

Regards,