Orlando: Best House Hacking Method?

Question

Hey everybody!

I am looking to possibly house hack in Orlando.  I have seen debate over multi-family and single family homes in terms of which is the better investment in this market.

If the goal is to be cash flow positive on a house hack, should I aim for small multifamily (2-4 units) or for a SFH in which I could rent out the other rooms?

Tyler Gibson · Answer

@Benton Shortridge Right now the Small multi-family market is really hard to make the numbers work. There is low inventory and high demand for these properties. I watch this market closely because I have several clients looking to buy these types of assets. If you want a duplex in a good area expect to pay 350k+ that is just the reality right now. Triplex and quad are even rarer and more expensive. If your true goal is to be cashflow positive then buying a 4 bedroom and renting out individual rooms is probably the way to go. I know a fellow investor here in the Orlando area that had a 5 bedroom house he was left with after a divorce. He ended up renting all the rooms individually and was doing really well. Eventually, he moved out and rented the master bedroom, and the property really cashflows now. If you ever have questions or need anything feel free to reach out.

Alberto Nikodimov · Answer

Hi @Benton Shortridge,I agree with everything that Tyler said. I would also like to add couple of things. It seems like there are 4 ways to househack in Central Florida and Orlando right now:1) Buys MF live in unit and rent the others.2) Buy a single family home and rent out the rooms individually.3) Buy a single family home with a mother-in-law suite and rent the additional space.4) Buy any of the above and do Short term rentals (Airbnb) with the additional space if legally allowed.I know people implementing each of these tactics and some of them have also worked for me. With that being said I also know many people who implemented those strategies and things did not work out because they did not consider all moving pieces.Your success of failure will depend on how well you handle the investment, your preferences and personalities.Here are things to consider before implementing one of the strategies:1) Are you willing to share spaces? Each of this strategies requires you to share either your backyard, living space and some times even bathrooms. Based on your level of comfort you will have to pick an approach that suites you.2) Is your partner/girlfriend/wife willing to share spaces with other people? Believe it or not this is one of the most common factors for failure in my experience. I helped couple of college students to setup a house-hack and everything was going great for few years until their girlfriends moved in with them and they were not willing to compromise.3) Do you have exit strategies in case things don't work out?4) Are you planning to provide cleaning for the common areas? Cleaning issues are the most common cause of conflicts between roommates. I highly recommend investing in that. You will have happier tenants who will pay more because you provide that service and most importantly you will avoid conflicts and reduce vacancy.5) Are you willing to deal with multiple tenants? Having 3-4 tenants and living with them is NOT easy and it is definitely not for everyone.I just realized I can keep going with that list for hours! I will be happy to connect with anyone who is interested in house-hacking, share my experience and even help set it up.Hope this is helpful!

Benton Shortridge · Answer

Thank you so much for your insight Alberto!

I would say for me personally:

1. I am more than willing to share spaces. I think I would be very comfortable with house hacking.

2. I am single so I will not have that challenge.

3.  I need to look more into exit strategies, but I would love to hold if I could find a good property management company!

4. Thank you for that insight!  I never knew providing cleaning could make so much of a difference.

5. I am willing to deal with multiple tenants, I am definitely a people person.

Right now I am living in Dubai and looking to remotely invest in Orlando (possibly house hack in the future).  So I am really looking for a partner in Florida or a turnkey company at the moment!

Elizabeth M Williams · Answer

@Benton Shortridge I also live in Dubai! Have you considered investing in multifamily syndications? I'm an SEC registered rep, specializing in capital raising for MF syndications. Sort of fell into it when looking into investing in a rental in the US. Spent several weeks digging into it and speaking with a ton of people, before investing, as well as getting so hooked that I got involved with introducing investors to these opportunities. We raise for 9 syndicators, and we cover Florida, as well. Happy to meet up for a coffee or have a zoom call to tell you about it, as we are actually listing our rental in Oregon in a month and a half, and will invest proceeds from the sale into syndications.

Also, I know that my CPA, Basit Saddiqi (who for some reason I'm unable to tag), has quite a few rentals in Florida, so he might be able to help, as well.

Benton Shortridge · Answer

@Cameron Braig  Thank you!  I definitely see it as a great market to get into.  That being said, it does not look very feasible to get a good deal on multifamily that would lead to a cash-flowing property.  Do you think it would be more of an appreciation play?

Cameron Braig · Answer

@Benton Shortridge

Congratulations on getting started and welcome to the forum.

Orlando has been a great area for multifamily investment. Job growth, rent growth and population have been amongst some of the highest in the country. Additionally the job diversification in Orlando has grown and is beginning to rely less on hospitality and tourism and making waves in industries like financial services, medical and manufacturing.

Benton Shortridge · Answer

@Elizabeth M Williams Hello!  Thank you for joining the conversation.  That is awesome, I would love to learn more about the syndication opportunities you are referring to.  So far I have been most interested in owning my own properties rather than getting into syndication, but I am open to the option.

Al Banfe · Answer

@Tyler Gibson, Where was your "fellow investor" friends property ? Thanks

Orlando: Best House Hacking Method?

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