Fat loss vs. muscle building

Hi all,

I started a basic workout program at the Y about a month ago. I'm a total beginner, but I have some idea what to do and how to get to where I want. Here's where I was at:

Male, 34 y/o, 200lbs, 5'8", kind of a a stocky build. Fat distributed pretty evenly. Not athletic, for sure, but I have always felt "strong." Like there was muscle there but flabby. A rough calculation of body fat would be about 20%.

My longish term goal is to get to 10% body fat. Short term goal is to lose 20lbs by the end of March. Depending on how much lean muscle I gain, that would put me about half way to 10% body fat.

I've been eating better, smaller meals. Every other day I do 5 to 10 minutes of cardio before doing the strength training circuit (resistance bands for now, will move to free weights later). And then I do maybe 30 minutes of cardio after that. I lost about 7lbs pretty quickly in the first 2 weeks or so, but then it stopped and I seemed to gain a few pounds back. It has been about steady there. I don't think I changed anything.

So my question: Could the fat loss be offset by muscle gain, keeping my weight about steady? Or is that kind of muscle gain in a short period of time unreasonable without serious effort?

I'm not really too concerned about the net pounds lost if I am gaining muscle. I'm just curious about what could be going on. Is there an initial muscle gain when beginning a strength training program for the first time? Or am I just being naively optimistic here?

I have noticed that jeans which used to be too tight to wear will now fit me. So I am seeing some results. I just need to know if I should get more aggressive. And what is reasonable in terms lean muscle gains.
 
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