Looking for House Hacking Advice

[Envision]

Why not buy a residential property with 4 units? Focus on just getting into a investment property that makes sense regardless of how the market is as long as you set a strict criteria for finding the correct properties youll be fine. Hustle talk to everyone let them know you are an investor and before you know it youll be finding a deal fair better than you would of if you just stuck to traditional methods. As long as you focus on income based properties and remove the necessary expenses I dont think youll have an issue regardless of the market condition. Seems to be a bit difficult finding a good property at the moment but its possible. Think outside the box.

Generally the reason most people cannot get into a 4plex is because the debt to income ratio is too high/ the numbers cant make sense.

Yes, it is ideal and would be great especially for a first time buyer but acting it out in reality is extremely difficult.

 

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[Ksalazar]

Generally the reason most people cannot get into a 4plex is because the debt to income ratio is too high/ the numbers cant make sense.

Yes, it is ideal and would be great especially for a first time buyer but acting it out in reality is extremely difficult.

I see there are deals out there cold calling, flyers, etc just look for people that need a solution solved through divorce cases etc. Although the market is hot and the prices are well over where they make sense there are still a percentage of over the counter deals you can find with a little bit of creativity and effort. Dont let it scare you, waiting for the right time will need to inaction. Make a strong criteria stick to it and dont settle. Im sure youll do great. Just keep working and networking let people know you are an investor deals sometimes come from people you least expect.

 

[DeletedUser0287]

I know I said, I gotta look elsewhere before but now I’m serious. Where else should I look. Duplexes just don’t make sense in Dallas TX or surrounding area.

 

[Dianne Cohen]

Need some tips on house hacking for those that have done it.

My Plan
- Conventional 3.5% Loan
- Location: Leaning towards Dallas Texas (thing I am not sure about).
- Single Family Home for like 150k
- 2 or 3 Beds / 2 Baths
- Most likely Airbnb to start off seems like it is easier to get tenants, I might be wrong.

I decided that I am going to get a lower down payment loan like 3.5% conventional instead of 20% and rent out part of it. I know there is PMI, but when I hit 20% I should be able to get rid of it. Which is why I chose conventional over FHA. I think FHA PMI (MIP) is for the life of the loan. Was hesitant for so long, because essentially taking mortgage like this is essentially "handcuffing me to my job". But I really got to do it, or I will be stuck living in my parents for life.

I ended up choosing Single Family Home just due to the fact that, duplexes/triplexes are too expensive. Condo HOA would be poor margins.

But with the house sales going down, prices should follow correct? Wait it off? I want the large metropolitan areas, but they too expensive for me. So closest I can get is like Dallas, TX or around there.

 

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[Dianne Cohen]

I think you have a great plan. This is a place to start. Air bnb does take a bit more work then straight renting, but the money is usually better if you are in the right location. The beautiful thing about this situation is that if you don't like being an Air bnb host, that you can do a straight rental.

For this first property, make sure you can make the payments on your own without your tenant. If that is the case and it is possible, take all of the money the tenants are paying you and put it toward the principle of the loan. Of course, when you get down the 20 percent, ask the bank to get rid of the PMI. They won't automatically do it for you. If you can keep doing that and quickly build equity, you will soon be ready for property number 2, by using the equity in your 1st property for the second. Keep using tenants money to pay down principle even after 2nd property. The point is to make a snowball effect. But here is a very important point. Do not hold more than two mortgages if possible. This is a form of protection. If the market gets bad for some reason, you should be safe.

Btw...Although I feel the market is a bit extended, if anyone tells you what they think the market is going to do, do not listen to them. There is no crystal ball. Keep yourself educated and use your best judgment.

I am not the best writer in the world, so I hope all of this was clear. If not, feel free to ask me questions.

 

[DeletedUser0287]

Update: So the loan officer and agent work closely together. I like the loan officer a lot, but this agent knows that I got pre approved for over 300k. I said I only wanted homes for 200k and she was obviously upset. She just wants bigger commission. She is just showing me houses above and slightly below 200k. Since I am now doing SFH, I ain't going to be spending that much on a SFH since I will now want two SFH to compensate. Should I tell the loan officer I want to work with a different agent.

So the homes I am interested in for investing are in areas where home owners are way above 60-70%. In other words, not much renters in this area at all. I obviously can't blame them because the houses are large and low price and great neighborhood. Not in Dallas. Should I avoid places where home ownership is high? Tenant turnover is going to be high because people will be buying their own homes and not much customers.

 

[Dianne Cohen]

Update: So the loan officer and agent work closely together. I like the loan officer a lot, but this agent knows that I got pre approved for over 300k. I said I only wanted homes for 200k and she was obviously upset. She just wants bigger commission. She is just showing me houses above and slightly below 200k. Since I am now doing SFH, I ain't going to be spending that much on a SFH since I will now want two SFH to compensate. Should I tell the loan officer I want to work with a different agent.

So the homes I am interested in for investing are in areas where home owners are way above 60-70%. In other words, not much renters in this area at all. I obviously can't blame them because the houses are large and low price and great neighborhood. Not in Dallas. Should I avoid places where home ownership is high? Tenant turnover is going to be high because people will be buying their own homes and not much customers.

Good Morning,

I am a realtor, (No booing please) so am coming from experience. Realtors are a dime a dozen, so if you don't like her, make the switch. You owe nothing to the loan officer, but an explanation would be nice.

As far as buying in that neighborhood is concerned...it sounds quite suburban. If that is the case. Check out what the schools these homes are zoned for. If they are really desirable, you will never have a problem renting them. I hope this helps.

 

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