New to House Hacking

[Jorge I. Pimentel]

Hello,

I am 24 years old living in San Diego, CA and have around 40k saved up. I’m very passionate about real estate and been educating myself as much as possible (books, BiggerPockets podcast, courses, etc.) to make the best move possible for my first investment.

The money I have saved up is not much in my market for bigger or more complex investments, but is a good amount for house hacking. Also, I have heard is a good start for new investors. I will start checking out properties soon and would like to purchase by end of year or by the beginning of the next. I would appreciate any feedback you might have for me. Anything to look out for or not miss out on. From working with realtors to running the numbers right in properties; anything is welcome.

In advance, thank you!!

[Nicole Holcomb]

Hi Jorge welcome to bigger pockets, and congrats on taking the first steps in becoming a real estate investor. You are correct that house hacking is the easiest way to get into the expensive San Diego market. I would recommend looking at the 2-4 unit multifamily properties available in your target areas as they are most conducive to house hacking. When you purchase a multi-unit property a portion of the rental income generated can count toward your income allowing you to qualify to purchase a more expensive property. 

If you are looking to purchase before the end of the year I would recommend getting pre-approved with a lender as your next step. I suggest shopping around to a couple local mortgage brokers to determine the different loan programs they offer that you will qualify for. My clients have been getting great rates from local credit unions as well (Navy Federal). With $40,000 you are not necessarily locked into a FHA loan. I work with brokers that offer conventional loans with only 5% down. FHA loans come with extra hoops to jump through so keep your options open and work with a lender that will take time to educate you and give you your options. If you are looking for a referral to a lender DM me. I will get you set up with an investor friendly lender that will take the time to teach you about the lending process as well as get you the best deal possible.

I'm sure you have heard that the San Diego real estate market is extremely competitive right now due to low inventory and high demand. Start looking for off market deals by networking with your SOI. Talk to everyone you know and tell them that you are looking to buy in the next few months and what type of property you are looking for. 

Best of luck to you and be sure to update us on your REI journey!