hey john!
Congrats on getting ready to start investing! I am only 1 investment propert in so far but doing well with it so far. Let me see if I can give you a couple tid bits from what I've gathered in my education... I would highly recommend listening to the BP podcasts, lots of good and actionable information in them.
Referring to your questions above:
1) some advantages I would note on living along with your tenants in a duplex/tri/quad would first be to allow yourself to live cheap, or free! If you can get the numbers right, living for free would allow you to save a considerable amount of money for your next property at the same time making a nice equity spread. Negatives would be you are always a doorknobs away from your tenants. May increase your busy work list to fix smaller issues. I've got a wife and 3 kids and my own house already or I'd consider doing that strategy.
2) go to a small bank, not a big box one. Smaller banks have the ability to help with creative financing. My investment house I was able to buy with 10% down compared to 20% at the other big banks. If you get a no, it doesn't mean no. Try someone else:)
3) multi family houses generally have better cash flow in my area but less appreciation. Appreciation is extra, don't ever count on it! If a tenant moves out on a quad plex you only lose 25% of your income. If your tenant moves out on a single family, it's 100%. Seems simple but means a lot when you really consider it.
4) risk, risk, risk... There are so many angles to approach this from. Financially, use the BP calculators and really dig into the money in and money out. Save your cash flow if you can to build reserve funds. Liability issues, use a licensed contractor to do major work so you"know" it's done right. Contacts I use from a real estate landlord group that are pre made and combed through by lawyers already. It's called the Washington landlord association. You may have a group similar in your area. Good luck and happy investing!
Randy White
