Multi-Family (house hack) or SFR

[Andrei P farley]

Good afternoon BP Family,

Today I sat down and decided that I had really done enough research on potential properties to jump in the deep end and stay afloat.

My wife and I currently own two rental properties but due to being active duty military, We've had to move and living in an apartment can not be anymore annoying than offering on countless homes only to be out bid because the numbers don't work. I'm out of VA loan money and this will be our first actual conventional loan experience and it's because of this that we're thinking of doing a less than ideal home that we can fix up over time while saving for another more acceptable home to raise two growing boys in.

With all this said, I’m really trying to convince my wife to do a multi-family house hack as this would jump start a truly amazing compound effect without having to purchase a forth rental for a while.

Advice or suggestions to this idea or am I being over zealous? Is my wife being to conservative or am I not selling it enough? We’re a military family and we do have two boys so as you all have heard or argued yourself about safety or raising a family while running a rental could be hectic for sure.

Thank you all and Happy 4th of July weekend!

[Taylor L.]

Have you considered a short term rental house hack? Buy a larger house than you need with an inlaw suite, then rent out said inlaw suite to Airbnb type short term rental guests.

Safety boils down to screening your tenants well. Establish rules and standards, have a strong lease, and stick to it. The vast, overwhelming majority of people are not out to harm anyone or burn your house down!

Consider the upside of what your children may learn by watching and participating with you as you run your rental. They'll learn about hard work, making a long term plan, the value of real estate, and so much more! 

Instead of thinking about what could go wrong, think about what could go right! What if your kids get so inspired, they decide they want to become real estate investors as soon as they can too?? What if your success in real estate inspires them to do it too, and they end up being successful real estate investors? What if they become millionaires in their 20s by leveraging skills they learn from working with you? That's not crazy or impossible - there are many stories of people who have achieved that.

One thing that helps a lot of folks get over their early fears is networking with others who started in a similar position and achieved success. Can you get out to local real estate networking events and talk with other investors? How about joining groups for military service members who invest? There are many of those!

It's hard to say what your wife's true underlying concerns may be. As humans we tend to make decisions more on emotions first, rather than on facts and figures. Not a male/female thing, we all do it. That's how marketing works. It's difficult to replace fear, but can you relate using other emotions, such as excitement of the possibilities for your children to learn from you? Just as an example.