@Aakshay Subramaniam First, you want to look for areas with high demand for rental properties and strong potential for appreciation. Make sure you do your research! Sure, you could get cheap properties in the middle of nowhere; but, typically you’re not going to find these complimenting attributes. With that, I (like many experts) also suggest investing in the SE. With the exception of places like South Florida which can be quite saturated, Florida is great for high return potentials because of its consistent population growth, beneficial tax laws, and strong markets. Just make sure you choose a location within your budget that would be deemed affordable and is in an area with high rental demand. You’re looking for areas with low vacancy rates and strong rental returns.
Being a real estate consultant who’s worked with various investors of different strategies over the years, I agree with some of the comments here; turn-key properties are the way to go for someone in your situation. Turn-key rentals offer potentially higher rents, have significantly lower maintenance costs, and it’s much easier to attract tenants who will pay premium rents for modern features. The most important thing is to just look for properties with good rental income potential in comparison to the purchase price.
In addition to low maintenance costs, you can also minimize your entry costs with an investor friendly agent who has both expertise and access to extensive inventory, including information on properties on & off the market. You want an aggressively negotiated purchase price, low closing costs, lower property taxes, affordable insurance, minimal HOA fees, and competitive property management fees. (Also, make sure you take all of these costs into consideration when you're calculating your cash flow!)
Having competitive financing can significantly improve your numbers, but even if your numbers are tight, remember that your tenants will be paying down your mortgage while your asset increases in value & equity. One day you’ll tap into the equity and use it to purchase more income producing assets. That’s your end game. Regardless, choose the financing option with the most favorable terms and interest rates.
First time real estate investing can be scary. Between market fluctuations, every so-called expert's economic forecast, and natural disasters…sure, I can understand that. But, consulting with investor friendly real estate professionals and financial advisors can provide great insight and can help you develop a clear plan & exit strategy; there are a few. (Also, diversifying your portfolio by investing in multiple properties or asset classes can help with the risk factors.)
Starting with $100,000 should be more than enough to go in with positive cash flow, as long as it’s done right. Hope this helps. Feel free to DM me if you have any more questions! I’m happy to help.
