Brand new investor in Appleton, WI

[Account Closed]

Greetings,

I have recently been shopping for houses in an area where prices have been increasing quite significantly recently.  After some frustration in finding a home to purchase and add equity to I stumbled upon the Bigger Pockets podcasts.

I now feel that the correct step to get into home ownership is through first purchasing a duplex and building upwards from here.  I have been given a pre-market opportunity to purchase a rental property from an owner, however I am not sure if the rents are capable of creating an instant cash flow while living for free.

Any advice from members in this area would be greatly appreciated.

Thanks!

[Vern Hixon]

Hi Scott, welcome to BP. I'm also a new BP member living in Appleton. I think you have a great strategy for getting started in RE. The first house I purchased was a duplex and I still own it today. However, depending on price, it's tough to get a duplex to cash-flow positively while living in one of the units. In hindsight, I wish I would've held out for a four plex on my first deal. You can still qualify for conventional financing (i.e. 30 yr fixed rate mortgage) and the possibility of having positive cash-flow while living there for free is much greater, especially if utilities are separate. Living in a four plexus would definitely entail some sacrifices, but if you can put up living next two three other tenants vs one, it is a much quicker way to snowball your first property into your second, third, and so on.

Whatever you decide, good luck. I'd love to hear your success story when you pull the trigger on your first investment property.