Creative Problem Solving for First Time Investors

[Cassandra Brown]

My husband and I are just starting out on our real estate investing journey. We are located in Sioux Falls, SD, and are looking to buy a small multi-family property to use as an owner-occupied first deal. Unfortunately, Sioux Falls is a seller's market and has been for years. All of the properties we have looked at (through our broker/realtor) are priced anywhere from $30,000-$50,000 above what would financially make sense in our current market (we go by the 1% rule in this area). 

We're looking for long term cash flow, as our goal is for my husband to be able to work just part time in the next 5 years in order to have more time to spend with our growing family (#2 is on the way!). Is it ever worth paying more than what makes financial sense just to get into the market?  If not, what are some tactics we could employ in order to search out some great deals? Thanks in advance!

[Derek Dame]

I would definitely not ever overpay for a property just to get into the market. Keep looking and searching. As Tyler mentioned, keep looking for motivated sellers. They are in every market. It might take a while to find a good deal. 

The best advice I can get is to prepare yourself for when you find the deal. Have your bank financing ready, have cash set aside, and be ready to move quickly when you see what you want. If you know you will close on a deal, make a larger earnest money deposit. If you offer 10-20k down and the next person is only offering 1k down, you should get it. Make connections with Realtors and let them know what you want and what location you are looking in. Try to be specific so when a deal comes up they think of you. Hope that helps.