It is beautiful out there but are people able to cash flow their existing STR. 

Granted, the current value gets you to your target cash-out number of $125,000 which is another option.

So I knew he knew what he was talking about regarding cash flow and real estate in general right off the bat.

So here is a partial list of people who might be more inclined to listen to your offer of a cash discount, or some type of vendor financing:Financially Distressed HomeownersThese are people who may be facing financial hardships such as foreclosure or debt.

It'll be tough to get into a pure investment in your area for 35k but here are a few options:- partner on the second deal- if the numbers make sense and you could get more cashflow then you could look at a higher price point but my guess is this will be difficult to find- Buy your first property as planned, and save the 35k as reserves and/or just keep it for the next down payment on another FHA after a year- find a place that needs some work where you can use that money to fix up and force appreciation to the propertyPersonally, I would look at those last 2 options where you have the cash on hand ready to deploy for the next down payment or rehab costs if needed.

But they still expect the high prices and most of those are sitting as well.I think largely the listing prices right now are unrealistic except for all cash buyers who only want to make a small return.So I think they want it to be on the move but I am not convinced that it is at this point.  

Also, I would like to buy it cash to get a better deal out of it and not have to pay for any interest or loan fees.

Thanks in Advance!

After a cash-out refi, I had my money back.

Yes, the issue is that I am short on cash for my down payments.