Strategic Analysis- Using 300K for max cashflow

[Brent M.]

Hi, I'm going to layout my general strategy for phase II of my RE portfolio and hopefully get some insight into what I may be missing.  Thanks in advance for any tips, tricks or advice!

I currently own 8 homes in Vegas and will be selling 3 of them over the next 6 months as tenant's leases expire.  This will give me approx. 300K in cash to use with the goal of generating 6K in monthly gross rents.  I've looked at several markets and believe Pittsburgh is the place to do this (is there anywhere else viable for a long distance investor with those numbers?).  I've got a guy I trust who can do full rehabs and still meet the 2% rule.  I'll be doing cash purchases since I'll be buying junkers (SFHs and small multis) in need of work and my debt to income ratio puts off lenders.  My limitations are the fact that I live in the Bay Area and have a great paying job that I love and won't quit (just yet- but in 5 years, who knows?).

Once I've achieved the 6k goal with 5 or 6 properties.  I will use the cashflow and my improved debt to income ratio to generate 2 down payments a year on properties in another market that has more appreciation potential- currently thinking Jacksonville, FL, but that may change.  OR, I'll get a portfolio loan and continue the cash purchase/rehab/rent process in Pitt.  The ultimate goal is 10-15K net monthly cashflow.

[Juan Maldonado]

@Brent M., Pittsburgh is definitely a market you can hit the 2% rule with. My company focuses on larger multi family so we are not a good fit for your strategy. However I do have a contact that I would feel 100% comfortable referring you to, if you want to do rehab rentals in GOOD areas. He doesn't and I wouldn't advice you go chasing 30k properties in rough Pittsburgh neighborhoods. Stick with the B plus areas and you are good. I will be in Pittsburgh in 2 weeks doing Due Diligence on a 152 unit up there, so if for whatever reason you happen to be around would be more than happy to meet up and chat about the market and what areas we are buying in.