Augusta, GA - Cash Flow Where to Start?

Question

I am a newbie to real estate investing. I have gone through the process of speaking with a realtor and applying for a loan. With this being my first time buying, I'm wondering what the best option is for cash flow in my first investment. I live in Augusta, GA. There is a lot on the market but I can't decide, I originally was thinking of buying a home - but now I am searching different apartments/town-homes/condos/duplexes. Any advice would be very much appreciated as I am just getting my feet wet and would love to start off on the right foot. Thanks in advance!

Winn Merwin · Answer

Hello @Keenan Thomas,My wife and I bought a home to live in, knowing it would eventually become a rental property in the Pendelton King Park area of Augusta. We have since purchased a duplex close by and are in the process of getting it rented out. We have used Shannon Rollings Real Estate as our property manager and have been happy with the results. They came highly recommended and have not disappointed.I would suggest reaching out to a few property managers in the area. They should know the rental market and should have valuable information for you. Secure a good property manager and see what areas they would recommend purchasing in as a rental. That is my Two cents. Have a great night. Or maybe day where you are. Not sure of the time difference.Winn Merwin

Chris Majors · Answer

Hey @Keenan Thomas, I'm from Augusta as well. What are your goals in purchasing a property? What type of financing were you pre-approved for? Owner occupant or investment?If you can swing it, buying a duplex would be a good way to get your feet wet. You can use favorable owner occupant financing (investment financing has higher interest rates and higher down payments), live in one side, and have the other side pay your mortgage. The cool thing about this strategy is, when you're ready to buy another property you can rent out the side you're living in and then buy another one with owner occupant financing.This obviously also serves your living needs while giving you landlord experience. I wouldn't suggest starting off buying apartments if you have no landlording experience.

Gus Ross · Answer

@Brian G. agreed on that ... but I can't seem to lineup price with owners in Palm Beach at the moment so I'm waiting somewhat patiently.

Brian Garrett · Answer

@Gus Ross I think you'll have a tougher time in Broward finding deals than Palm Beach.

Gus Ross · Answer

Anywhere in Palm Beach County when the numbers are right and am currently expanding to Broward County and looking in the Orlando area next weekend. I'm at 9 units but as a contrarian I didn't overextend with leverage and paid off 8 of the doors and carry no debt on them. Since then I've raised capital commitments based on my track record but can't seem to match up a deal on cap rate numbers in the commercial space (things are a bit inflated in my opinion so we are cash heavy waiting for correction). I'm always looking and trying to network with as many wholesalers as possible.

Shamekia Mckenzie · Answer

Gus Ross what areas do you buy property in

Gus Ross · Answer

Hey @Keenan Thomas it seems like a house hack won't work if you're going to be overseas and can't live in the units for the next 6 years unless I misunderstood the situation. Given the issue it is going to be crucial to line up a reliable property manager and then it becomes a numbers game on the properties. You'll need some boots on the ground to scout the properties while overseas for prospecting/purchasing but this can all be done. On your point of distinguishing the best deal I highly suggest reading up on cap rates and rate of returns to ensure your number calculations suit your investment needs/wants.

Keenan Thomas · Answer

Well let explain my situation a little more @Gus Ross & @Chris Majors I'm currently in Afghanistan for employment and I want to start creating passive cash flow, at this moment I've been looking at duplex's and single/multifamily homes saw some good deals and if all else fails and it can't rent I wouldn't mind living in the place but I will be overseas for at least the next six years so on my leave I would like to create a portfolio of houses to assess and determine a buy i plan on financing the deals maybe putting 10% - 20% down. The goal is to begin investing in decent rental properties to accumulate I certain amount of passive cash flow, I plan on trying to get a house every year. As I search through I see rental properties everywhere and its difficult to distinguish what could be the best deal because i can only choose one. It will be the first house I've ever bought I'm still learning but i have time i don't plan on doing this until next year, I've read through forums & blogs but it still seems unpractical. Then in augusta, ga theres a lot of low income housing should i house hack and making them tenant proof and rent out to the less fortunate but i can see the headache dealing with bad tenants or should i still try getting a duplex using the strategy above.

Shamekia Mckenzie · Answer

Hi Keenan and Chris I am in Augusta as well I have some properties for sale. Good advice Chris with the duplex idea.

Gus Ross · Answer

Hey @Keenan Thomas ... the reply by @Chris Majors is a great strategy. Getting the cash flow numbers to be profitable/favorable on your first deal will exponentially help your progression. The "house hack" strategy of buying a duplex and living on one side short term is a solid solid way to start. Best of luck.