Hi Bob

This is only my second post and I am new at this also, but if I were you I would consider the multiplication by division rule and look for two +ve cf properties priced around the $100 – 150K mark – once you pay a 20% deposit and closing costs for both you should still have a bank of around 20-30K to maybe do a few cosmetic upgrades which will improve the rent return and for contingencies. Remember that when you are borrowing for these IP’s the rent return you are expecting is factored in as your income thereby increasing your borrowing power. I have found the best way to go is look for cheap properties that have been divided into two flats or that you can divide into two flats or that have a studio/granny flat or are in areas where student accommodation is required and you can rent by the room. That way you can substantially increase the rent return. You can either use the cashflow (and the contingency $)or as I do put it in an offset account against the loan so that it is keeping the interest payments down (creating more +ve cf)and effectively paying it off quicker but is also readily available should you need it for some purpose – or there when you are ready to sell so that you can do some more cosmetic repairs or use it towards the cost of the next property.

Hope this makes sense, NolaO