First Post College Investment- FHA 203K House Hack

[Josh Ricord]

Hello everyone! My name is Josh Ricord and I am a recent Biomechanics and MBA graduate and retired student athlete as of 2023. I am currently in my first year of my W2 job (post graduation), and after a year of listening to Bigger Pockets, getting my real estate license, and allocating funds, I have finally decided to dive head first into my first investment. I have 20k saved and plan to use an FHA 203K loan and house hack to net zero/cash flow minimally on my first investment. I am using my newfound access to the MLS as a tool to source good deals and make educated and sound investment decisions. As a college athlete at a smaller D2 School in Georgia, there is a strong market for student housing that has yet to be met in my area. With tons of ex teammates and international students looking for housing in our small town environment, there is a untapped avenue to succeed. My primary goal is to net zero with house hacking, renovate to appreciate, and refinance after a year, pulling built renovation/sweat equity. This in essence to pull liquid cash out for a second investment, and transition the property into a long term rental. I wanted to use my introductory post on Bigger Pockets to prompt feedback and advice on my current foundational plan from industry professionals that can guide me on my journey to success.

- How can I maximize my strategy for investment longevity? How feasible is this plan from the POV of a seasoned investor?

- What is some good general preliminary advice when jumping into your first investment?

- How can I use my real estate license as an advantage to the best of my ability?

Thank you so much for taking the time to read and respond to this post, and I look forward to networking with you all in the future. Thank you!

- Josh Ricord

[Matthew Porcaro]

@Josh Ricord

Hey Josh, congrats on graduating with an impressive degree while also being a college athlete. That’s a lot to juggle and you should be proud of your work ethic.

I’ve seen a big commonality between real estate investors and them being collegiate athletes. I think it’s the fact that college athletes are coachable and execute quickly. They also tend to understand delayed gratification better than most haha.

To answer your questions:

1. The best way to maximize your strategy is to ensure that you build significant equity on your first house hack. Using the 203k will 100% help you with this. Just focus on building as much equity as possible. Ideally you want to be all in (purchase + renovation budget) for less than 80% of the after renovated value of the property.

This will give you the ability to tap that equity later if needed to go purchase additional properties.

2. Best advice about jumping in is just that. JUMP IN. do not make my mistake and consume too much content or videos or podcasts. Just trust the numbers and make tons of offers. Don’t be afraid of rejection. Just go for it. You will learn the most by doing. Not studying. Again, something a college athlete would know well.

3. The way I would use your MLS access is to just peel through the MLS daily looking for distressed assets. Look for properties that need work. Set filters for: as-is, fixer upper, 203k, handyman, motivated, negotiable, TLC, cash, etc.

Those keywords usually mean there’s some motivation there. Motivation to sell ideally will get you into these properties at a lower cost basis which means more cash flow and equity.

Also, look for long days on market, expired listings, etc.

I think you’re definitely on the right track and are definitely way ahead of where I was at when I started.

Just know with something like a 203k, you’re putting such little down, it’s soo hard to lose.

Especially if you stick to your numbers.

Biggest piece of advice I give on 203k’s is just make sure you use the right team and use them in the right order.

Get a DEEPLY experienced reno loan lender. Most will say they can do them, but not many are experts. You want to get the experts.

From there, once you get under contract, get your 203k consultant in the property immediately to do their inspection/schedule of repairs write up. Only then, bring in your contractors to bid that scope of work.

This is one of the biggest mistakes I see people make. They get their one contractor they know to give a bid, and if it’s off, it makes it tricky to solve. Get multiple contractor bids 3-5 ideally.

Then you’ll know that your pricing makes sense.

Hope this clarifies a bit for ya. Best of luck!