Originally posted by @Milad Keshavarz:
How about buying a multi-family property, rehabbing it and then renting it to generate cash flow? By purchasing cash you buy below market, and by rehabbing the property yourself, you end up with nice equity. You can then refi and get cash out and repeat the process. This way, you have equity in each and every property and you generate a nice cash flow.
So when you say multi family I am assuming you mean vacant duplexes or fourplexes? So assuming I pay cash for a multi-family for $125,000 and put $25,000 in rehab into it making the property then be at an assessed value of $200,000. Would you then finance it at the new $200,000 value putting 20% down ($40,000) pocket the rest and rent it out assuming it will cash flow well, say $4,000 a year giving you a 10% coc return? Or would you just finance it at what you have in it the $150,000? If the $150,000 would traditional lenders still want you to put 20% down?
