House-Hacking with FHA loan – strategy question

[Chris Platis]

Hi BP! Thanks for reading my post. Looking for any thoughts, opinions, guidance on my first purchase and subsequent path: 

I have a decent chunk of money reserved, enough to buy and renovate a true fixer-upper. 

I'm looking for a 3-4 unit building and will be financing with FHA, probably 3% down.

I was just about ready to pull the trigger on a property, but started thinking that AFTER the renovation, my newly depleted liquid funds will keep me sidelined. I am now thinking it would be better strategy to buy a home in better condition, even if it is priced considerably higher, to leverage the FHA money at a friendly 4% rate, stay liquid, and fast-track the next purchase within 1 year.

The market I am looking in seems pretty fast but stable – I had just always had it in my head to NOT buy move-in or close to move-in ready condition homes, but given this scenario I'm sort of thinking paying a premium on the house at the benefit of staying liquid to purchase (and renovate) a subsequent second home may be a better strategy. 

I'm happy to provide more details, home costs, etc. if that helps better paint the picture. Essentially the question boils down to whether or not tbe community feels that leveraging an FHA loan as much as possible (by buying an expensive, close to move-in ready home) in order to keep liquid funds (which would have been used to renovate a more moderately priced home) ready for another purchase in the short term is a wise strategy. Any thoughts? Any comments or feedback is very greatly appreciated. Thanks again for reading. Best of luck and success to all.

Chris