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New Investor Getting Into It (A Small Tale & 2 Questions)

Devampre

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Hi everyone,

So I'm buying my first property which I believe is a good deal for a 2 bed 1 bath home in a small village. My plan is simple. Move in, put a little into fixing it up/making it look nice, and then renting it out either to long term tenants or a bnb for hunters, snowmobilers, tourists, etc.

I feel like this is a comfortable stepping stone for me getting into real estate investing and building equity

But, part of me is also looking at the cities as the lack of socializing and dating has been weighing on me... Though part of that is also because of covid, but I digress...

At first I was all over mobile homes, until I saw the lot fees and heard some anecdotes of people that had issues with mobile homes in this particular city. Then I started looking at condos. Some looked okay and the association fees were significantly better than the mobile home lot fees, but I felt like paying over $100,000 for a condo didn't feel right. Even when considering renting it out and doing my best to "work the numbers." The returns never seemed to be great and I didn't really want to share space with my tenants.

Lately, I've been thinking about multifamily units (mostly duplexes.) And part of me is considering inquiring about foreclosures. I see this strategy as the ideal approach as I could temporary live in one unit and then rent out the other unit until I buy another property and rent out both units.

Am I on the right path of thinking or am I missing some vital information?

I know some people might suggest to just go rent in the city and rent out the rural property ASAP. But, there's part of me that is still looks at paying rent as burning money. Perhaps, I have some frugal disposition or perhaps this is a common debate amongst real estate investors.

What do you think? (Regarding the proposed debate above.)

Thanks! :)
 
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DCDeuce

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Dec 3, 2016
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^^^ What he said.

From what I just read I don't see a defined goal, real estate investing seems straight forward but to buy correctly is fairly complex.

What is your goal and waht do you want to do.
 

Devampre

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I'm trying to amass a portfolio of properties of which I rent out for profit, increase my overall networth and build equity.

I am at property number one, so my immediate goal is simply getting it ready to rent out and finding the next deal.

Now ideally this next deal would be in a city and will allow me decent living/working quarters while renting out a portion of the property. This is largely what attracts me to multifamily properties. Which may not be the best approach, but currently seems the most attractive to me.

Eventually, once I find a third deal, I will fully rent out that entire second property. And rinse and repeat until I feel better about buying and renting out properties without the need or desire to want to live in them.

So in time I'd like to own a good amount of properties and possibly some more land. (My family rents some farm land, but a lot has been overvalued recently so I'm not really looking to buy more farm land here right now.)

My longterm goal would be a few million worth of real estate throughout the province with my sights on buying more properties here and perhaps elsewhere.

I hope that I have been more clear, but apologize for any further confusion.
 
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TurtleSprint

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@Devampre Personally, I think multifamily is a great route. Like the other routes, it has pros and cons but income from one unit or another at any given time is a great benefit. Single family doesn't allow that luxury. However, you have more than one family's problems to solve and they tend to not take as much ownership in the property. Lawn care, etc. The list could go on in either direction.

What is your timeline for turning around your first property? I don't want to define your goals but my first thoughts are what does "fix up/make look nice" entail? And how long will it take? Time to raise funds?

How do you go about finding the next deal? And what do you consider a 'deal'?
 

Devampre

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you are doing a great job, good luck to you!

Thank you! :D

@Devampre Personally, I think multifamily is a great route. Like the other routes, it has pros and cons but income from one unit or another at any given time is a great benefit. Single family doesn't allow that luxury. However, you have more than one family's problems to solve and they tend to not take as much ownership in the property. Lawn care, etc. The list could go on in either direction.

What is your timeline for turning around your first property? I don't want to define your goals but my first thoughts are what does "fix up/make look nice" entail? And how long will it take? Time to raise funds?

How do you go about finding the next deal? And what do you consider a 'deal'?

Timeline for the turn around is going to be "dynamic". I am fine staying here for the next 6 months or even longer. I would say this is due to covid, but now, in addition to my main business, I just acquired a third party tech support service (without consent really... it's a long story lol.)

"fix up/make look nice" essentially means that I am going to be redoing much of the finishing work (taking down panelling & putting up drywall, painting, taking out some walls, putting in new laminate flooring, putting in new baseboard, redoing the bathroom, and so on.) I have family contractors, a little of my own time and some other local contractors that will be getting this all done. The timeline for this will probably be a couple months.

Next deal I would like to find would be something like a duplex. Maybe a foreclosure, if I can find one that makes sense. Ultimately, I'd like a property where I can basically pay the mortgage/expenses (or at least a good portion of it) by simply having one tenant occupying the second unit.

I'll either find it via realtor, online search, or if I can find a nice little private deal like this first property I'll do it that way. Regardless, I need to see the property first hand before I make any decision. I am not confident to simply buy based on pictures.

And I consider a deal to be anything that will likely generate a nice return or at the very least, be something I can sell to break even on.
 

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