Getting Started - Florida or Texas? 4-Plex or Homestead with ADU?

Question

I’m attempting to figure out my next course of action. I live in Washington State but am looking to move to a warmer climate. Thus far I’ve narrowed it down to Texas or Florida. I have not spent a significant amount of time in either state, but being warm and having cheaper costs of living relative to where I live are very appealing.

If I transfer departments at my place of employment I shouldn't have a problem living anywhere in the continental U.S. so I'll still have a decent income (higher 5 figures). I currently have a SFR 4bd/2.5ba unit in Washington with positive cash flow. There is roughly $150k in equity to work with for funding an investment property via a HELOC (Still shopping for the HELOC I'd want to use). I also have the option to take out a loan of around $25k from my 401k to fund a down payment on a property.

The long term goal is that I want to build a homestead, along with an ADU for rental income. I'm a gardener and would love to live on some land so I can put my hobby farm skills to use, but the homes with land in Florida seem to be in areas where I am concerned about safety. In Texas I'd need to find a place that gets decent water for the farming activities. By trade I am an instructor and would love to be near enough to society to run classes from my property for some additional income, so living somewhat near civilization would be preferred.

That being said I'd also like to take advantage of leveraging. I have a VA loan from my time in the service that still has some entitlement left ($260k at 0%). With my previous landlord experience I can qualify for a 2-4 unit place as long as I live in one of the dwellings. So do I go for a homestead property, or purchase the rental unit and live in one of the dwellings?

I travel a lot for work, so I will need to have a property manager even if I lived on the property.

The good news is I feel like I have options. I’m just confused at which path to take. It’s taken me a long time to get here and I don’t want to mess this up.

I realize I have a lot of goals here that don’t seem to intertwine, and are a little all over the place.

Any advice you can give me on a course of action or recommended places where I could put down roots would be much appreciated as I don’t have someone to bounce these ideas off of.

Thanks in advance!

-Craig

Diana Muresan · Answer

@Craig Ebersole there was a lot info I could not follow, I just picked up one item. I couldn’t understand what you meant by the VA loan, do you currently have a property that’s financed with a VA loan? If so I would refinance it and reinstate the entitlement and purchase a multiunit on a VA loan. I do this all the time, in all states. And since you are moving in a different state you could refinance that VA loan as a second home and not investment since you will be out of state at that point.

Matthew Miller · Answer

@Craig Ebersole, There shouldn't be much humidity when you are here this time of year. Probably highs in the low 70s or mid 60's and 50's at night. Kind of perfect this time of year, can't say the same for the summertime, however. No matter where we live, there is always a season that isn't fun to deal with!

Craig Ebersole · Answer

@Matthew MillerThanks for the response Matthew. I’ll be in FL next week for some volunteer work and I’m planning on seeing if I can handle the humidity. Love the idea of being able to grow food there year round and escaping my current cold climate.

Craig Ebersole · Answer

@David Baier Thanks for the information David. Do you cover the Sanford, FL area at all? I have some friends there who say I'd like it.

Craig Ebersole · Answer

@Jim Cummings Thanks for the reply Jim. I’d be able to work from home so I'm not tied to a specific office or area.That is good to know about the rainfall locations as well as the variation in rules on the ADU’s.I think I may take a road trip through the state to scout out potential areas.

Matthew Miller · Answer

@Craig Ebersole Every market is different so make sure and do your research obviously. If you do need a contact in the Jacksonville area, feel free to message me. I have done work in various areas of Northern Florida the past few years in the investment markets.

David Baier · Answer

Both states are great to target right now, with population and and job growth. I think conventional biases will prevail when speaking to someone in FL vs someone in TX. The Orlando, Tampa, and Jacksonville markets all have opportunity but all are very competitive. If you're leaning towards anywhere in Central FL PM me and I'd be happy to help.

Jim Cummings · Answer

@Craig Ebersole. Texas is a LARGE state. You said in OP "If I transfer departments at my place of employment I shouldn't have a problem living anywhere in the continental U.S" Does that mean you can work from home or it means there are numerous offices open to which you could transfer?1. If you need sufficient rainfall - that probably means East Texas, South Texas, or Central Texas.2. Many towns may not allow an ADU, while others will not have sufficient governmental oversight to even care what you do as long as it's not a house of ill repute. (:>)3. Bottomline: Probably need more insight and definition from you before we can provide any salient advice.