Seeking Advice: Starting Real Estate Investment in NY with FHA or Conventional Loan

[Raymir Cuevas]

Hello BiggerPockets community!

My spouse and I are excited to begin our journey in real estate investment in New York. We currently own a co-op in Queens, which we purchased a year ago for $260,000. We made a 20% down payment, and the mortgage is under my spouse's name. The co-op's monthly cost, including HOA and mortgage, is around $1,800, and we cannot rent it out.

We are both employed, with a combined annual income of $147,000. Our goal is to create a large portfolio and invest in rental properties and any other opportunities. We have been prequalified for both a conventional loan of up to $308,750 and an FHA loan of up to $378,000.

We are considering the "house hacking" strategy by purchasing a multi-family property, living in one unit, and renting out the other units to offset the costs. I know in NY is difficult to find anything under 400k. Since we have been prequalified for both FHA and conventional loans, we would like some advice on which loan type would be best suited for our situation and goals.

Here are our main questions:

1. Should we opt for the FHA loan due to its lower down payment and more lenient qualification criteria, even though it may have higher mortgage insurance premiums?
2. Would a conventional loan be a better choice, considering our goal of building a real estate investment portfolio?
3. Are there other financing options we should consider for our first investment property?
4. Any recommendations on areas in NY to begin our real estate investment journey, considering the current market conditions?

We greatly appreciate any advice and insights from any investors on this platform. Thank you in advance for your help!