Seeking Strategic Investment Advice for Today's Market

[Phil Avery]

Hello, BiggerPockets community,

I'm reaching out to gather your insights on the most prudent investment strategy given the current market conditions. With $20k in savings and an additional $4k monthly saving rate, I'm navigating my next steps carefully, especially since I value starting with a substantial equity position in any deal.

Here are the options I'm contemplating:

1. Invest in a Low Entry Property: With my capacity for a 20% down payment, I'm considering properties in the $100k-$120k range. This approach aligns with my preference for immediate equity and the potential to replicate this strategy with a second property by year's end.
2. House Hack a New Construction Duplex: I've spotted a duplex priced at $405k that's appealing for a live-in investment. Using an FHA loan, I'd put down 3.5%, although this would stretch my budget slightly. The long-term benefits seem promising, but it's a considerable leap.
3. Delay Action and Save More: Alternatively, I could pause any immediate investment, focusing on boosting my savings for a larger down payment on a more significant property next year.

Your experiences, insights, and any advice you can share would be immensely valuable to me. I've always found the BiggerPockets community to be a wealth of knowledge and support. Thank you in advance for your guidance!

[Phil Avery]

Quote from @Steve Vaughan:

Quote from @Phil Avery:

Hello, BiggerPockets community,

I'm reaching out to gather your insights on the most prudent investment strategy given the current market conditions. With $20k in savings and an additional $4k monthly saving rate, I'm navigating my next steps carefully, especially since I value starting with a substantial equity position in any deal.

Here are the options I'm contemplating:

1. Invest in a Low Entry Property: With my capacity for a 20% down payment, I'm considering properties in the $100k-$120k range. This approach aligns with my preference for immediate equity and the potential to replicate this strategy with a second property by year's end.
2. House Hack a New Construction Duplex: I've spotted a duplex priced at $405k that's appealing for a live-in investment. Using an FHA loan, I'd put down 3.5%, although this would stretch my budget slightly. The long-term benefits seem promising, but it's a considerable leap.
3. Delay Action and Save More: Alternatively, I could pause any immediate investment, focusing on boosting my savings for a larger down payment on a more significant property next year.

Your experiences, insights, and any advice you can share would be immensely valuable to me. I've always found the BiggerPockets community to be a wealth of knowledge and support. Thank you in advance for your guidance!

Glad you're looking for equity capture going in.  That is our REI buffer and isn't discussed enough IMO.

I did well with lower priced singles, but this was when prices were lower up to 2018 ish and I bought with seller-financing or cash.  Tough to find lenders if the loan amount is less than $100k.
I specialized in c class houses for condition (age) vs c class rough neighborhoods.  

I think duplexes require 5% down.  I like your househack strategy, just might lower my target to an existing in the $250k range.  

 Agreed! It's certainly not talked about enough IMO. Everyone is always talking about ways to decrease/eliminate the upfront costs and never mentions how that negatively impacts your overall position across the board in the long run. Fundamentals are key for me. 

Thanks for sharing your insights. Currently, its very hard to make SFR cash flow in my market and you're right, I do expect it to be a bit challenging finding a lender for this purchase amount, but not nearly as hard as it is to make SFR's cash flow! lol.

I like the idea of switching up the criteria a bit to look into existing builds and a lower price point. That would mitigate some of the associated risks as well. Thanks for chiming in!