Hello All! First and foremost, thank you for your time interacting with this post!
Come 1st Quarter 2021, I plan to buy my first property. The purpose of this investment is to 1. Get a great deal (build instant equity) 2. Live in it as my primary residence.
Right now I see two options and I would love to hear everyone's opinion on which is better. Option 1 is getting a FHA loan and possibly a FHA 203k to rehab it since it will most likely be somewhat distressed, but still still satisfy FHA requirements. Later if I want to make it a rental, I could refinance it to a conventional loan to get rid of the PMI and produce more cash flow. Option 2 is going straight to a hard money lender and flip a house to live in it. This option would allow me to BRRRR the equity out of the house and place it into my first true rental investment faster.
Option 1 seems to be easier and a good way to slowly get started in the game. Is Option 2 realistic? Are there hard money lenders that lend to first time investors in the first place? Option 2 seems to be better if I want to dive right into it and increase the velocity of my investments. Would love to hear advice and feel free to tell me how you started.
P.S. My market is quite expensive but definitely good deals out there. Average house is $300K (good deals in type low B/high C neighborhoods are $180k) so it takes some time to save 20%. Good to keep that in mind.
