Thoughts on possible deal.

[John Kernen]

I have a potential deal I would like advice on. This would be my first deal. 4bd 2bth SFR it is in good condition but dated (70s era). House in its condition are selling between 200-240k. I can buy the home as is for 200k. I can do conventional financing and put 25% down pulling the down from my 401k. I really want to do a BRRRR but I don't think that is do-able with this house for what have to give for it. I still think that I could clean it up, spruce up the paint and flooring and rent for about 1400 per month. This should let me cash flow a bit and get me started. My concern is that this will tie up all my cash and credit into this deal an not give me much opportunity to borrow against it for following deals.

I have been looking at properties left and right, most need major work and they are smaller and older. They are still selling quickly for 150k. I feel like this is so much more house for 150k and if I act now I can get ahold of it before it goes on the market. Any insight is appreciated! I really need to get the first one under my belt! Thanks

[Lynnette E.]

I would rather have a $160k house that rents for $1400 a month than a $200k house renting for $1400 a month.  More house is not good for the rental business unless it gets you more rent.