New Investor, tough decision.

[Isaiah Lopez]

Hello BP Members! I am very new in my pursuit of becoming a RE investor. I am in the military, 24 years old married and have 2 young children. Because of this I often find myself trying to be very conservative. However about 1 year ago I decided to get over it and start looking for my first property. My goal is to own a fairly decent size portfolio, absolutely no less then 5 units in the next 5 years. I feel like this is a very fair/ conservative number after seeing many BP members doing this amount in their first few months. I was living in San Diego Ca and only had 8,000 saved up. I then got ahold of a mortgage broker and he let me know i would have to use a VA loan which wouldn't require any down payment, only closing costs. But I would have to live in the property. I ended up getting pre-approved for 400,000. At this point I was extremely excited to jump right in but at the time the market was moving very fast. Nothing in a decent area was close to my price range. After a few months with no luck I decided to extend my search north to the Temecula area. I did not have any structure to what I was buying. I just wanted to get in and start paying principle on a property, instead of throwing away rent money. So after getting out bid multiple times I finally got accepted to a nice 3 bed 2 bath 1150 sqft single family house with a 5700 sqft lot for 315,000. My savings pretty much went to closing costs and I was in on my first house. This was early July, 2016. Since then I found out I will be moving to North Carolina. My initial plan was to rent this house using a property manager if I ever moved. This has came sooner then I anticipated. The good news is the properties in North Carolina are extremely cheap compared to those of Southern California. Everyone I have talked to from there says they make good rentals but their property continues to depreciate. After looking online at other single family homes same size in Temecula , the rent is between 1600-1800. My mortgage and PMI however add up to 1950. Most local management companies I have found charge 50% first months rent when getting a new tenant and 100 per month there-after. If I was to sell it (looking at other listings) I could put it up for maybe 330,000 like other comps. But with that closing costs and taxes would likely take any gains. So I know most likely I will be paying out of pocket. I do believe that property in this area appreciates very well and will hopefully continue. So my question is should I keep the property in Temecula as a rental and look forward for the appreciation and hopefully paying it down over the years. Or should I sell it and possibly look for wiser investments in a cheaper market. Also when I move which will be soon. Should I look to buying another property and living in it or should I play it safe and just rent. Doing this is the only way I can comfortably afford getting into another property. Until i can start looking into possibly multi-family homes or build a good track record with a bank. Please if anyone can give feed back, I could use all the advice available. I am very open to learn and would love to hear what everyone thinks of my current situation. Thank you very much reading. Respectfully, Isaiah.