STARTING OUT (House hacking, where to invest, advice)

[Freddy Espinoza]

Hi all,

This is my post on this forum. Happy and excited to interact with this community! 

Here is where I stand and this is my question:

Just like us all, my goal is to reach financial freedom. I am a bartender and still live with my parents. I have capital saved but no high salary on a w-2. I have no properties so I would qualify as first time home buyer. 

Should I move out into a house/duplex and house hack? What would be your advice to me to do in my situation?

Thank you for your time!

[Dan H.]

This is a challenging market for real estate.  I am a Dan Diego RE investor and most of my purchases were easy to see that they would make money.  The difficulty was not finding properties that would make money, it was selecting the property that would make the most money.  Unfortunately the market is different today.  

however, a patient house hacker is one of the more likely strategies to work. 

Typically what @Samuel Diouf suggested will not work, unless you also include a significant and successful value add, for a few reasons 1) debt to income requirements likely will provide a means to get a loan on a 2nd property. 2) saving 5% for OO down in Orange County on MF likely means at least $50k with closing costs. 3) the home if purchased rent ready off mls will still be cash flow negative after a year (and 2 years, 3 years, … at some point it will have positive cash flow but I would not expect it in less than 3 years on rent ready property.

If you have questions on San Diego RE market, you can PM me.  I stay north of hwy 8 because I live in north county but I believe the markets most likely to out perform San Diego general RE market are all in South Bay.  West Chula Vista because of the bay front redevelopment and because it is the only market I am aware that near the bay or ocean is cheaper than inland.  Imperial beach because it is cheapest beach RE for ~200 miles for various reasons but a big one is the sewer issue.  The sewer issue has existed for 50 years but with increased population it keeps getting worse.  It has never had as much publicity and clout at solving the problem than now.  Still it will be a long time to fully solve but the RE prices today are based on a severe sewage issue.   It should start improving and as it improves prices are likely to rise faster than the San Diego market.  South Otay near brown field.  Today brown field is one of many secondary airports but it has 2 things going for it.  A multi decade already approved development effort.  An existing CBP for small aircraft.  Combine these 2 and brown field is likely to set itself apart from the other local secondary airports. 

Best wishes