Seller Financing? FHA? 5% Down Fannie mae?

[Nolan Mahoney]

Lokking to buy first house hack Beggining of March. I really hope intrest rates drop by then because no residential multifamily works at 7% with FHA or 5%. This brings me to seller finance. I like the flexability that SF brings but dosent seem to comon to come across. My question is should i ditch the idea of doing FHA or 5% and strictly look for SF options? or keep waiting untill March and see what kind of situation were in?

[Andrew Postell]

@Nolan Mahoney I've seen the same videos you have.  Read the same articles.  But the real scoop to real estate is that it's a long term investment.  It's not a "get-rich-quick" scheme no matter what tickytock says.  20 years ago, all the rates were 7%-8%.  There wasn't a term such a "cash flow" then.  If you wanted to be a full time real estate investor, you went and flipped.  But if you wanted to create long term, generational wealth...you found a way to keep properties.  All of us that got started back then and DID buy when rates were in the 8's...are millionaires today.  This is a long term plan.

A few years ago there was this thing called the "2% rule"...meaning, if you purchased a property you rented it at 2% of the value.  Then when you couldn't do that, they changed it to the "1% rule".  People who need to sell courses have to create excitement about real estate so you buy their products.  I don't mean to come down on this too hard because lots of things are worth paying for.  But what if I just told you the truth?  And didn't have anything to sell?  Then you might make a good, informed decision...maybe?  Some people may not still make good decisions but here's the question I will pose to you:

Would you pay me $100 per month for 5 years in order to get $50,000?  

And of course you would.  Who wouldn't?  But that's not what all the videos say...but that's the truth.  You will not cash flow on ANY property right now.  It's very likely you won't cash flow next year either.  Now, if you did buy a property this year...you'll increase rents next year.  Then you'll increase rents the year after.  Around year 3 you'll break even.  But the tenant is still paying down your debt for you (that creates equity) and if we use 5% appreciation each year...in 5 years you will clear $50,000.  

And that's the truth. 

Home ownership is very hard right now.  It won't get easier in the future.  In 5 years, you will be thankful to have any property.  In 20 years...you'll be telling others this same story.  

Hope all of that makes sense.