Just getting my own home... what now?

Question

I just got an offer accepted on a home that my SO and I are buying for ourselves. It's everything we've wanted, including location, on the water, size, etc. It's our first home, and now that we have a big loan out there, what is the best way for ME personally (not really him) to start out small with investing? I was thinking beginning with saving for a DP on a hard money loan, then maybe getting a small condo to fix up and rent out...? I know some of those places unfortunately have rent stipulations (like waiting one year or more). I just want to know of any ways one can start out considering I just got my OWN home and will be spending a lot of $ on that for the next year or so. We definitely do not want to flip and sell/rent our home (we want to live in it and enjoy it)... so any advice is appreciated. THANKS!

Jerry Padilla · Answer

@Andriana  Babikian why are you thinking hard money? Conventional financing is best for but and hold. Rates and terms are great right now. If the prices are too high locally than I would look Out of state to invest.

Steve Vaughan · Answer

Hi @Andriana  Babikian.  Welcome to the site!  A couple of observations from me (sorry to say) I'm sure you won't like.  I wouldn't recommend buying property together with someone you're not married to.  Maybe too late, but had to say it! If it doesn't work out, a legal mess awaits.

Condo's and their associations are a pain in general and can be very onerous financially and otherwise. I understand they are probably very prevalent in your area, but I would avoid if possible.

Hard money is expensive and has short repay deadlines.  Long-term buy and hold isn't the best business model for HML I don't think. If something happens and you can't refi as planned...you will lose it all.  I would go for more of a private lender if possible, especially on my first rehab-rent. Maybe query private lenders and how to find here on the site.

That said, I would go for a bread and butter 3 bed in a working class neighborhood if at all possible, in your own name or together with your spouse!  Good luck!