New member in SF Bay Area

[Roy Daniel]

Hello Biggerpockets.

My name is Roy and I am a new member looking to begin investing in real estate. I came up with the idea to start looking at real estate after I inherited a sum of about 60k and wanting to put the money somewhere instead of keeping it in a savings account where it eventually will go to waste. I have some experience investing as I have purchased some stocks throughout the years. But the biggest issue I have with the stocks at the moment is the lack of passive income it creates (once you sell you stop earning money) and the inconsistency of the market as of late.

Thus that leaves me with Real estate. To give a brief background of my current situation. I live in SF bay Area and currently rent an apartment for about 1600k a month! I make fairly good money for the work I am doing but it is getting harder to save money as the price of everything keeps rising in the bay area. This is making me want to start looking outside the state in invest.

I am still studying the topic of real estate investing and trying to figure out good markets to invest in for passive income. I was hoping to get some advice on this. I am currently leaning more towards multifamily because running the numbers in my head it seems to make more sense, however, it seems more multifamily homes are located in “bad” neighborhoods and I am wondering if it’s really worth the risk. At the moment I am thinking with the 60k I can possibly purchase 2-3 properties that are worth about 80-100k that are located in decent neighborhoods and use majority of the cash flow to purchase additional property later on (this is largely based on assumptions I put about 20% down payment on a property that follows the 1% rule).

As for a goal I would say for the time being I would like to try and match my career monthly income with my passive income. This I would admit is a very premature goal as I have only started thinking about real estate about a month ago. I do plan on reading a few more books and flying out to locations I am looking to invest in around the summer time… Hopefully purchasing the first property if not by the end of the year, at the start of 2019. Any advice would be wonderful!