Renting Section 8, Flipping in Today's Market

[Alex Proskourine]

Hi guys,

I’ve been doing some extensive reading and doing property analytics in Garfield park (East/West) and Hegewisch, and have been seeing a lot of investor activity in terms of rehabbed Section 8 rentals as well as conventional Fix and Flips.

In the current market, is it better to acquire rentals or to start out with a Fix and Flip? My goal is to obtain the cheapest property, however being in reasonable condition for a basic rehab to minimize risk..

It seems like section 8 rentals are popular. There seems to be some uncertainty in the housing market, and therefore this could be the reason?

Thanks so much!

[Rick Stein]

It depends what your goal is. Fix and flips are fine but you will pay short term capital gains and then you must go to the next one. In other words, you have a job. Rentals give you long term income assuming you bought it correctly and have a positive cash flow and your tenant is paying down your mortgage every month. Rentals are the way to wealth. Why not do both? You can do flips to give you cash for rentals.

Good luck