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Updated over 2 years ago, 06/01/2022
Trying to find first rental
Hi BP community,
I am 22 years old, I have been focused on finding a rental property for 3-4 months and doing research for about a year. I took the state re licensing exam two days ago and will start working as an agent soon. When I think about investing or look at properties, I feel like I don’t know what I want or cannot find it and end up changing my search to another location or property. At the same time, I want to move out of my parents house so i can have more control over my environment, focus and become more productive. However, most multifamilies I come across are fully occupied. Overall, the fustration makes me want to put my head through a wall.
Since I am new I don't know if I am being smart by being patient or stuck in analysis paralysis. I have financing and cash but I cannot find the right property. When I think about investments, I want atleast a 3-4 unit multifamily with a value add opportunity or a single family house hack using FHA to move out for a year. I am searching in the Danbury CT area and listings meeting my criteria in the location I desire are scarce. Any advice to help ease my stress?
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- West Valley Phoenix
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Why start with a 3-4 MF? Way less of them, and more expensive to get into. Why not start with a nice SFH, maybe a fixer so you can get some easy equity built in, let out a room if you can? Then refi in a couple years and get more...or then step up to a MF.
Seems like you're trying to start in the middle instead of the bottom, no wonder you're frustrated.....relax and be patient, you're still really young....
Hey Bryce,
I was in your position 2 yrs ago when I first started. I currently have a few properties and I'm also in the Danbury area. Feel free to ask me any questions and I can even meet up with you if you like.
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Quote from @Bryce Muller:
Since I am new I don't know if I am being smart by being patient or stuck in analysis paralysis. I have financing and cash but I cannot find the right property. When I think about investments, I want atleast a 3-4 unit multifamily with a value add opportunity or a single family house hack using FHA to move out for a year. I am searching in the Danbury CT area and listings meeting my criteria in the location I desire are scarce. Any advice to help ease my stress?
Have you tried looking for off-market deals? Run a search of expired listings to see if anyone tried to sell and failed. Maybe they are still interested. Drive the neighborhoods you are interested in and look for four-plexes that appear neglected or poorly managed. Track down the owner and speak to them directly to see if they are interested in selling (you can sometimes get their contact information from one of the tenants, especially if they are unhappy with their Landlord). Call the property managers in your area and ask if any of their owners are considering selling.
A fourplex is a better way to start. Read "Set for Life" by Scott Trench or "House Hacking" by Craig Curelop to get a better idea of how this accelerates your investment strategy. I would do it myself if I were single, even at the age of 52.
- Nathan Gesner
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@Bryce Muller I can't tell from your post - are you working with lender and a realtor? Or just browsing Zillow?
Quote from @Bryce Muller:
Hi BP community,
I am 22 years old, I have been focused on finding a rental property for 3-4 months and doing research for about a year. I took the state re licensing exam two days ago and will start working as an agent soon. When I think about investing or look at properties, I feel like I don’t know what I want or cannot find it and end up changing my search to another location or property. At the same time, I want to move out of my parents house so i can have more control over my environment, focus and become more productive. However, most multifamilies I come across are fully occupied. Overall, the fustration makes me want to put my head through a wall.
Since I am new I don't know if I am being smart by being patient or stuck in analysis paralysis. I have financing and cash but I cannot find the right property. When I think about investments, I want atleast a 3-4 unit multifamily with a value add opportunity or a single family house hack using FHA to move out for a year. I am searching in the Danbury CT area and listings meeting my criteria in the location I desire are scarce. Any advice to help ease my stress?
Welcome to BP, Bryce! I just want to point out something. You are saying that you will become an agent soon, if you do use some kind of financing make sure you are checking with a lender. Because once you became an agent, you will fall under 1099/self employed... and if you do become a 1099, you have to wait 2 years until you can purchase a property. I would act fast if I were you while you are still in W2 (assuming you are W2 employee). If there's no great MFH deals right now, I would switch to SFH and work your way there too. :) Here is no shame if you go to a SFH first.
Good luck out there and if you have any questions, feel free to message me
@Bryce Muller - It is definitely hard to find deals throughout the country including in CT. My theory on investing is that if you are willing to hold long enough, you will make money on real estate even if you do not time the market well.
The reason is that if you buy at the top of a market cycle and are willing to wait until the top of the next market cycle, you will make money. The big decision point then is to only buy properties and areas that you are willing to hold for long periods - 10 years or longer. If you are, don't sweet the numbers too much unless you are going to have to subsidize it so much.
Happy to talk more about this. Reach out on here.
Hey Bryce, it can certainly be tough searching for a quality house hack. It can be difficult finding a 2-4 unit in which the numbers make sense. In many markets you will have much more luck doing a rent by the room single family house hack. Perhaps less comfortable but it will get you started, out of your parent's house, easier to finance, usually more lucrative, and much more inventory. I don't know much about Danbury but that's the way it is in many markets. Good luck!
Hey Bryce,
My advice is not to wait for a home run deal. While you may not "live for free" if you jumped into a house hack today, there are so many more benefits such as:
* Owning a property and benefiting from the wealth builders (tax benefits, loan paydown, appreciation and maybe some cashflow)
* You get to experience being an investor, but on training wheels. You will learn a lot while house hacking which will prepare you for future investments.
* You save significantly in terms of your personal finances. Again while you may not be living for free, you may be living for half (or even less) of what it would cost to rent. With that saved money, you could save up for another house hack or investment property.
Just about two years ago, I was in your same situation, living in Danbury as well looking for my first house hack. My wife and I decided to take the leap and move out to New Britain CT to house hack a three family. My advice to you is just get started. So what if you do not find that BRRRR opportunity from the the start. Most people never even get started in the first place.
My recommendation, go find a place to house hack, live for cheaper than you would in a rental, learn the ropes of being a first time investor and figure out your next real estate move then.
Reach out if you have any questions and good luck!
Quote from @Bruce Woodruff:
Why start with a 3-4 MF? Way less of them, and more expensive to get into. Why not start with a nice SFH, maybe a fixer so you can get some easy equity built in, let out a room if you can? Then refi in a couple years and get more...or then step up to a MF.
Seems like you're trying to start in the middle instead of the bottom, no wonder you're frustrated.....relax and be patient, you're still really young....
Quote from @Alpha Journal:
Hey Bryce,
I was in your position 2 yrs ago when I first started. I currently have a few properties and I'm also in the Danbury area. Feel free to ask me any questions and I can even meet up with you if you like.
I am new to BP so i do not know how to private message but I am interested in connecting soon. Thank you!
Quote from @Nathan Gesner:
Quote from @Bryce Muller:
Since I am new I don't know if I am being smart by being patient or stuck in analysis paralysis. I have financing and cash but I cannot find the right property. When I think about investments, I want atleast a 3-4 unit multifamily with a value add opportunity or a single family house hack using FHA to move out for a year. I am searching in the Danbury CT area and listings meeting my criteria in the location I desire are scarce. Any advice to help ease my stress?
Have you tried looking for off-market deals? Run a search of expired listings to see if anyone tried to sell and failed. Maybe they are still interested. Drive the neighborhoods you are interested in and look for four-plexes that appear neglected or poorly managed. Track down the owner and speak to them directly to see if they are interested in selling (you can sometimes get their contact information from one of the tenants, especially if they are unhappy with their Landlord). Call the property managers in your area and ask if any of their owners are considering selling.
A fourplex is a better way to start. Read "Set for Life" by Scott Trench or "House Hacking" by Craig Curelop to get a better idea of how this accelerates your investment strategy. I would do it myself if I were single, even at the age of 52.
I need to work harder on marketing and lead generation. That is something i wanted to focus a lot on when i got my license because if it there is not a deal opportunity, atleast i can get listings from people who do not want to sell at a discount.
Quote from @Nicholas L.:
@Bryce Muller I can't tell from your post - are you working with lender and a realtor? Or just browsing Zillow?
All three but i use Realtor.com :)
Quote from @Zierry Eme Carl T. Tagbas:
Quote from @Bryce Muller:
Hi BP community,
I am 22 years old, I have been focused on finding a rental property for 3-4 months and doing research for about a year. I took the state re licensing exam two days ago and will start working as an agent soon. When I think about investing or look at properties, I feel like I don’t know what I want or cannot find it and end up changing my search to another location or property. At the same time, I want to move out of my parents house so i can have more control over my environment, focus and become more productive. However, most multifamilies I come across are fully occupied. Overall, the fustration makes me want to put my head through a wall.
Since I am new I don't know if I am being smart by being patient or stuck in analysis paralysis. I have financing and cash but I cannot find the right property. When I think about investments, I want atleast a 3-4 unit multifamily with a value add opportunity or a single family house hack using FHA to move out for a year. I am searching in the Danbury CT area and listings meeting my criteria in the location I desire are scarce. Any advice to help ease my stress?
Welcome to BP, Bryce! I just want to point out something. You are saying that you will become an agent soon, if you do use some kind of financing make sure you are checking with a lender. Because once you became an agent, you will fall under 1099/self employed... and if you do become a 1099, you have to wait 2 years until you can purchase a property. I would act fast if I were you while you are still in W2 (assuming you are W2 employee). If there's no great MFH deals right now, I would switch to SFH and work your way there too. :) Here is no shame if you go to a SFH first.
Good luck out there and if you have any questions, feel free to message me
Thank you for this information, i will be sure to check with my lender to check if that will be an issue. And i would do a SFH but it needs to be in the right location which is new fairfield bc i want to use fha and live in it for a year so i am letting a little emotion in to make that decision.
Quote from @Bradley Dosch:
Hey Bryce, it can certainly be tough searching for a quality house hack. It can be difficult finding a 2-4 unit in which the numbers make sense. In many markets you will have much more luck doing a rent by the room single family house hack. Perhaps less comfortable but it will get you started, out of your parent's house, easier to finance, usually more lucrative, and much more inventory. I don't know much about Danbury but that's the way it is in many markets. Good luck!