Ft)For ARV, it is best to have an experienced real estate agent find comps for you to determine a safe number to work off of. 

Purchase price: $395,000 Cash invested: $100,000 Sale price: $570,000 Such a fun project!

Hi all,I am a young newbie investor looking to make my first real estate purchase in 2025.

So the idea of doing this all from afar is a bit daunting, however, I know the most important thing here will be to create a great team and outsource as much as possible.I have set my sights on a couple of different markets being in the Southeast and the Midwest; these markets seem to provide the cash flow I am initially interested in generating to value add to the properties I purchase.

For me, the first pass at underwriting is simply about determining if a deal is worth exploring further.In the current market, I’d say 9 out of 10 deals are dead on arrival.

Purchase price: $2,400,000 Sold a single-family home and did a 1031-exchange into a 5-unit building at a cheaper price.

Nothing says that the compensation cannot be determined after the fact.

Find a mentor that can help you through the purchase of your first house hack, and get something you can fix up off market directly from the owner.Use the help of the mentor to find out if it's a good deal and to help you understand if it could work.  

If there isn’t significant equity capture at this purchase price, and it’s not in a great location, this would be a pass for me.

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable).