Hello,
I'm new to the investment property game. I'm just so sick and tired of sitting in my home office every day, staring at my computer screen, sitting on Zoom calls, and so I've been listening to more and more BiggerPockets podcasts on REI and other inspirational videos on financial freedom. My wife and I do very well financially, but for me, my paycheck is just not worth the stress and depression I feel sitting in that office every day. She is, and will always be, the bread winner so we're in a good spot where I can take a chance on doing something different, whether it's REI or buying an existing business.
So I've been doing hours of research every day for the past couple months on REI. I look at homes it seems like all day long on the MLS. I feel like I know as much as I possibly can without having any real world experience and I'm ready to dive in.
The problem is, I have no idea how anybody can find any deals. I look at all these multifamily buildings and MHP's all across the country. And when I'm trying to calculate potential cash flow, the debt service accounts for about 80-90% of the gross operating income, and that's BEFORE a 50% expense ratio. It makes no sense to me. (I'm accounting for a 25% down payment). I also see so many properties bought in the last year for like half of what it is being listed for today.
Even where listings have been on market for 100+ days, the price comes down a little, MAYBE, and still it makes no sense to me how anybody makes money, unless you're paying cash for these properties. I was getting very excited about the idea of getting into REI, with my wife and I having solid W2 income to protect ourselves at the beginning of this journey, and having a large chunk of equity on our primary residence to use towards a down payment or two. It's become very discouraging after all the learning and research I've done.
Is this what people are noticing in today's market? How is anybody new to the game finding any deals? Should I look to get into STR's?
Thanks
Rich
