Advice for Investing Windfall (RE Newbie in Upstate NY)

[Lauren L.]

Hi All -

My name is Lauren and this is my first post on the forum. I have been making my way through the video library and they suggest introducing yourself here, so I figured I would heed the advice :) 

I am new to real estate investing, still in the research and planning phase. My overall goal is to replace my W-2 job with a small book of rentals, being financed by a recent windfall I received (700k). I live in upstate NY zip 12309 so am considering multi families here near home, but also really had my heart set on one or two small vacation rentals in the Adirondacks. I would love advice to help me decide between vacation rentals in the adirondacks or a multi-family property closer to home or one of each? I am a working mom of a growing family, my hubby is an engineer and loves is W-2 job so we are somewhat tied to this area and still have our primary residence here. Now that the world is virtual, we are hoping to make it to our vacation home one weekend an month but rent for much of the year. 

A peek inside my brain to understand all of the thoughts and questions I have are as follows ... 

- Is it really feasible for me to go 2hrs into the adirondacks every twice a week to flip a vacation rental? 

- Is it better to have a few smaller vaca rentals on different lakes or one luxury rental?

- Is it smarter to have a multi family unit close to where I live so that I can manage more easily?

- I am only looking at small waterfront properties in the Adks. How do you figure out how much your potential waterfront rental can earn on sites like airbnb? What are the most important things to consider when buying a potential vacation rental .... # of beds or square footage? 

- Can I actually earn enough income to quit my job off of two vacation rentals, like really? 

- Is buying a multi family near home and then one vacation rental a smarter investment? Although I like the idea of having a few smaller rentals in Adks better than a mutli family until in an extremely high tax rate area like this one. 

- How do I find actual data on vacation rentals or Airbnb as to what the properties where I am looking rent for and what their typical occupancy rates are? 

I really can't stand my day job and am hoping to reduce my ours and eliminate my job or only work seasonally down the road (I am a CPA and would like to just work during tax season and not the rest of the year). 

As you can see, I am all over the place! Can you all give me some direction? 

Thank you in advance :) 

Lauren

[Steven Luttman]

Lauren,

Congrats on making the jump into real estate. You've raised a lot of good questions. I'll take a shot at the multi family ones and leave vacation rentals for someone more qualified on the topic. 

The path of least resistance to eliminate the W2 job in my opinion would be a portfolio of local apartments. The best way to learn the business is by being hands on, and having the ability to swing over to meet with contractors & tenants is a plus. You may decide self managing isn't for you, but at least you have the option. 

With downtown revitalization grant money from the state starting to show effects, Schenectady (shout out to the 12309!) is an attractive option. While some local lenders are offering higher LTV products assume your down payment will be 25% of purchase price. The amount of funds at your disposal would be sufficient to build an attractive portfolio that would achieve your goal. One word of caution, perhaps start with a single 3-4 unit and see if landlording is what you thought it would be before deploying all of the cash.

Best of luck, -Steve