I am actively looking for another 10-20 unit building that is within my self imposed limit of one hour drive away.

affiliate_id=489888 They have a great self-paced starter course for under $500 that I think provides the basic info which let's you learn what you don't know to further your education.

Am I missing out on serious compound interest effects that will hurt me down the line, or is it smart to make sure I have the necessary cash if house hacking is the ultimate short term goal?

Warning:  If they are self employed (RED FLAG)  they will likely need a MIN on 10% down and need a Stated Income ALT type programIf they are strong, good credit borrowers, hold a 15%ltv seller held purchase 2nd, this way they can look the best financing terms and eliminate the PMI.Likely the 1st mtg lender will want you, the seller holding the 2nd, to hold the purchase money 2nd mtg with a MAX  5yr Balloon or longer

Yes I did go with CSE very cost effective.

this means, 2 mcdonald workers living together in yucca valley could easily pay $1200/mo for a quality rental.my homes have all increased 10-20% a year for 3 yrs straight - as the few quality inexpensive rentable homes that come up are fought over by investors, new home buyers, airbnb.a sewer assessment going into effect will add 100-150 to the monthly tax burden (along with a few other assessments in the works - school,fire) Bob Armstrong (a realtor in the area) creates a nice email newsletter each month with data/commentary.

The formula(s) would look like:Potential Gross Income (PGI)  = full rents + any other income at 100% occupancyminus Vacancy & Collection Losses (8-10%) is typically usedequals your Effective Gross Income (EGI)Then you subtract your operating expenses (taxes, insurance, management & legal fees, repairs, utilities, lawn service, pest control, etc., and a reserve for capex) to get your Net Operating Income (NOI)From your calculated NOI, you can really start digging deep:Subtract your debt service from your NOI to get your cash flowDivide your NOI by the acquisition cost to get your cap rateTake your NOI, add the reserve for capex back in, then subtract your mortgage interest, to get your taxable incomeDivide your NOI by your debt service to get your debt coverage ratio (tells you how many times will your NOI will cover your debt/mortgage payment).

Make sure you factor in the higher turn over costs (bed bugs, rehab, court fees, etc), vacancy and management, whether self managed or not, it will take more time and effort than normal and require a hard nosed manager to keep it running. 

If I could go back and tell my 20-year-old self anything it would be to buy a 3 bedroom house and rent out the rooms to 2 of my closest friends!

What is the most effective source of financing for portfolio purchases between $1-2 million?