Save up your profits from the rental income and do it again.

Or would it make more sense to buy the multifamily and re-sell for a profit and use those profits to buy my first rental?

How can would you make this deal work from a profitability? 

If you can partner with someone that has a contractors license, you may be able to obtain private money or sell the opportunty for a share of the profit or for a flat fee in escrow. 

@Dave Saveri I hope my blog post is helpful to you as I cover some basics in setting up a syndicate.Here is a link for you: Apartment Syndications And How To Tap Into Huge Passive Income Profits

You'll also have to think about how you want to split profits and losses between the two of you if one of you is fronting cash and the other is fronting services. 

Inventory stays forever on the market in smaller markets and if you're going the HML route, the interest costs will eat into your profits in no time.Don't view a market as expensive or cheap purely based on the average price of a property.

I always have my investors do at least a 7-10 day inspection period just in case we need to re-negotiate on the price after the contractor reviews the property.Once my contractor looks at the property they can kinda tell me what they think is going on with the property and also give me an estimate on re-hab costs we like to make sure the numbers make sense there is a certain profit margin we need to make on every deal.

After being an active broker for 30+ years, I would encourage you to become a licensed agent and then broker.The experience of inspecting many properties on a daily basis, learning the listing as well as the selling side will only up your game when it comes to negotiating with a seller who's property you want to buy.Some of my best and most profitable 'flips' were because I went out on a listing call, knew the property values and was first on the scene. 

Regardless of how the numbers shake out for your investment, they'll at least know they'll be guaranteed to receive their money back, as well as make a profit at the end of 3 yrs.