Real Estate Investing - Starting Out Slow

[James Waugh]

I am new to this forum but see that a lot of people get great value from it. 

I am interested in getting started in real estate investing, but I'm curious if my thoughts are correct. My thoughts are to purchase a duplex/multi unit property using an FHA loan and live in one side for a year, then purchase another one and live there for a year.

From my understanding, I could reduce the cost of my living while renting out the other unit(s). Then once I move out of the first property I can rent out the unit I was living in and be able to get cash flow from the property.

This seems like it may work, but like I said, I am new and am curious to see what seasoned investors think.

More information about me: I am 23 years old and have a full time job making 70k a year. I am in a good position to be able to move around a lot if necessary.

[Andy Fritz]

As a lender, I think this is such a great way to accumulate property quickly. My best friend just completed what you did and here's the basics. You can only have one FHA loan at a time. Your next purchase will have to be a traditional Conventional loan, but you can put as little as 5% down as long as it is your primary residence. Investment property is usually a 20-25% down requirement. By using the property you're buying as a primary residence, you are saving potentially hundreds of thousands of dollars over your lifetime. Also, when you go to move out of your duplex, you can offset debt used in qualifying formulas by using the duplex rental income as a source of income for qualifying. This means that you can add debt VERY FAST without having to qualify off of your traditional income. This let's you stack 6-10 properties quickly as long as you can afford the down payment. Good luck!