Military and moving around... Where do I have investment properties?

Question

I am a college student and I just got accepted into pilot training with the Air Force, this is my dream, but not how I plan on making my money. I am very interested in Real Estate investing and am currently saving up for my first down payment. I have struggled to find ideas from people with military careers and I was wondering if someone has some good insight on this. The question is where I should have my investment properties if I am moving around all of the time, because if I invested in properties at every base, that means finding a new management company every time I leave which would be really tough. I have been told it is a good idea to live near them or have them in some sort of relative cluster... but again, this is difficult with a military career. Any ideas even if you aren't military are greatly appreciated!

Paul Timmins · Answer

@Nathan Singer

Welcome. I have a buddy who closed on 242 units while deployed. You might consider student housing see below.

Locate and attend 3 different local REIA club meetings great place to meet people gather resources and info. Here you will meet wholesalers who provide deals and rehabbers (cash buyers).

Two Great reads, I bought both J. Scott The Book on Flipping Houses,  The Book on Estimating ReHab Costs  http://www.biggerpockets.com/flippingbook

Consider checking out HUD homes for small multi's owner occupied gets first crack.

To find out about an are go to IREM.org search for ARM certified property managers. Call 5 ask them what parts of the city they like/dislike and why. Ask them what they see expenses running per category per unit. What do they see them selling for per unit, what is the market occupancy rate. What are the market rents? Ask them if they know anything coming up for sale. Great way to pick up some good info and possibly a deal.

You might consider Niche or Specialized Housing like student housing. Rents can be 2-4 times more. Remember you don't have to own a property to control it.

Download BP’s newest book here some good due diligence in Chapter 10. Real Estate Rewind Starting over

http://www.biggerpockets.com/files/user/brandonatbp/file/real-estate-rewind-a-biggerpockets-community-book

Good Luck

Paul

Elizabeth Colegrove · Answer

My husband is active duty navy and a pilot! So welcome to the fold!!

While this lifestyle has had its moments (my husband has lived in 5 different cities in 6 years and I 4 in our 5 years marriage  ;) we have been able to turn it into an amazing investment strategy.  Our dreams is to be totally financially independent using the cash flow of our investments when my husband retires (navy/god willing) in 15 years.

We have not been able to make multi plexus work but have done VERY well turning class A single families homes into a viable strategy for us. We invest in both personal properties turned rentals when we are transferred and pure rentals. I had the opportunity to talk about our strategy in podcast 103.

While it has had moments and certainly is NOT how we ever predicted our path to "weave" we have been more successful than I ever imagined. So keep you eyes open, turn roadblocks into keys for success!

PM me if I can help! Its been a CRAZY road but super, fun and alot of financial beneficial.

Tyler Flagg · Answer

@Nathan Singer congrats man. UPT is a blast. Any idea where you're going to be stationed for it?

I second what @Neal Hinson said. VA loan on a multi is a great way to go. Also, remember that pilot training is very time intensive...so it won't give you much free time for real estate unless you're a natural born Chuck Yeager. haha.

As for your question, there's generally two schools of thought on the matter when you're in the military and buying real estate.

1) Buy properties wherever you are stationed.

PROS: Easy access when you live there. Work on them yourself. Self-manage. Find great deals because you can drive for dollars.

CONS: Properties scattered across the country. Multiple property managers/contractors/realtors/banks etc. Hard to intimately know all the markets

2) Buy properties in one or two markets regardless of where you are stationed.

PROS: Intimate knowledge of the market. Good network of PM's/contractors/realtors/wholesalers etc. Easier to manage and organize.

CONS: Rarely able to personally check on properties. Relying solely on your team. Harder to find great deal.

There is no right or wrong answer when it comes to this. I know people in the military who have had great success with each of these methods. There are also people who do a combination of both. It honestly boils down to what your preference is.

Feel free to send me a message if there is anything I can do to help. Best of luck man.

Neal H. · Answer

First, congrats on being accepted to USAF pilot training. Make sure you you stay focused on that until after you get those silver wings. As for your question, anywhere you can find a great property manager with acceptable returns. I could easily see a fourplex in your future with a zero down VA loan.  If you end up at the AF UPT bases, do your homework. You are not the first Lt. Who has wanted to do real estate at that base. Good luck and have fun!

Tim Lindstrom · Answer

You may want to look up the BP podcast with Elizabeth Colegrove.  Her husband is military, and they seem to be very successful investing in different areas as he moves around.

Brian DiBartolomeo · Answer

Nathan,

@Jerry Padilla is correct and you should talk to as many people as  you can.  Don't be fooled into "free" real estate seminars.  Believe me, I have worked with many of those groups and can tell you a lot of stories.

My company, Aspect Properties (www.aspectproperties.com) can also help you find investment properties.  We work in the Metro Detroit area.

James works in the Cleveland area, so between us, I think we could help you tremendously.

Brian DiBartolomeo

248-651-2700

Jerry Padilla · Answer

@Nathan Singer

exactly as @Brian DiBartolomeo

Find an area you are comfortable with and a top notch property manager to work with. A property manager can make or break your business.

@James Wise

works with a lot of out of state investors and can give you some insight.

Kerry Baird · Answer

That's what we have done.  We've bought near Air Force bases, starting with our first owner-occupied house in England.  We sold that, and bought a couple of houses with the money we earned on that first house.  We bought another owner occupied house in England, and we bought a couple from a distance while overseas.  We continue to buy houses in Florida, where we are stationed now.  We've used the tax-free savings from deployments, you know, the 10% on your funds, as down payment money.  We have borrowed from TSP for down payments.  We have used bonus money for houses.  We've seen young airmen get huge bonus money and buy Audis...we buy houses instead.

Ryanchase Balthazar · Answer

Hey! I am also in the Military (Army) and that question has crossed my mind. What I plan on doing is continue to save for the down payment. Find a property around base so it can be easy to manage if you decide to live there or not.

(Side note) Having property near the base would likely be rented out easier due to the constant turn around of servicemen.

Brian DiBartolomeo · Answer

Nathan,

It completely comes down to finding an area you are comfortable with and working with a reputable property manager in that area.

If you decide to invest in more than one property, you can always go back to that property manager and ask for investment properties they know are available.  This way, you don't have to have managers spread across the country and you can enjoy a fairly passive income without headaches.