Real Estate Strategy for low income earner

[Kelly Joseph]

So been a lurking in bigger pockets for a few years. I would like to purchase a property within the next year or two. However I have a few reservations. Currently I am working  as a cashier. I am 30 Years old. I dont make a whole lot of money but I have no debt and 50k in savings. I wanted to know how to best select property I want to purchase. I know that lenders can consider rental income from the multifamily property. I live in south Florida. I researched and found a few properties but they are 500-700K. I dont want places in poorly run areas and plan on using a property manager. I intend to use these properties for retirement so I will be reinvesting profits not concerned about cashflow for now. My main concern is if I would have enough in down payment and rehab cost. Should I save up to one year in reserve. Im concerned if no one rents and I am stuck with mortgage payment I cannot afford. Is one year reserve or should I wait until I have two years. 

[Josh Stevens]

Look for 4 units or less, worst place in the best neighborhood, FHA is going to want you to live in one of the units for at least a year if you are going to go that route. Get a home inspection, don't be afraid to back out of a deal, if you are forcing it.

Speak with a mortgage broker before you shop more to get a more realistic idea of what you are actually going to be able to purchase. As a brand new landlord, they may or may not count all or any of the property income until you have a couple years tax returns to back it up with.

Keep it simple until you have a firmer grasp on how things work, for every person on here with a "I got rich and retired in 3 years with real estate" story, there are a million inactive accounts of people who got over leveraged and lost their seat at the table.

Required reading:

The Richest Man in Babylon

The Millionaire Real Estate Investor

Good luck brother!