Starting My Investing Journey - Looking at San Antonio
Member since 2021 · 12 posts · 6 votes
Starting My Investing Journey - Looking at San Antonio
Most Popular Reply
Wale LawalBusiness Member
Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votesSan Antonio has a solid demand for rentals in addition to attracting its fair share of tourists. Because of this there are many great strategies we can employ to find a good deal house hacking in this Texas city.
Here are five of the best house hacking strategies for San Antonio.
Look at Multi-Unit Properties Like Duplexes
The mean prices for properties in San Antonio show a cheaper price for multi-unit properties like duplexes, triplexes, or other similar multi-unit properties. This is great news if you’re looking for a house hack because it makes it easy to have your slice of privacy while also having units ready to rent.
Based on the average monthly mortgage payment for a low down payment FHA loan, the mean rent from one unit would cover all but approximately $100 of the mortgage payment.
Keep in mind there are taxes, repairs, etc, but that’s true of any house and if you have a triplex, a 4-unit property or manage a better than average interest rate, or put down a down payment of more than 3.5%, then the deal starts looking very good.
Check out our free house hacking calculator to work with more precise estimates.
Location Matters in San Antonio
Neighborhoods can vary greatly in San Antonio. This is in regards to school quality, average income, quality of the housing, crime rates, and more. This is a city that tends to be neighborhood heavy – meaning there are a lot of different areas considered neighborhoods that have the population of small towns.
So a lot of 3,000 person neighborhoods versus 15,000 person neighborhoods. The quality of neighborhood is important, but location also matters because San Antonio is a prime area for Airbnb which really opens up the cash flow potential from house hacking.
Pay attention to the potential properties that are close to sites like The Alamo, Six Flags, or within a reasonable distance of UTSA. These have an even higher short-term rental potential.
Know All Your House Hacking Financing Options
Explore all your options when looking at how to finance a house hack. As we've covered before, many specialty loans are allowed for investment properties as long as the person is also living there. This is why ideas like VA loans for house hacking are worth exploring.
VA loans for veterans
FHA first time home buyers’ loans
Conventional bank loans
Fannie Mae & Fannie Mac housing loan programs
Seller-based financing
Some of these are very easy to get approved for while others require more paperwork, steps, or negotiation.
Don’t settle just for the easiest route. If the easiest route gets you the best rates that’s great, but it’s important to do all the work to see what your options are and weigh the pros and cons of each.
Keep Short-Term Rental Possibilities in Mind
Don’t limit your options. While you may like the security of a long-term rental for a house hack, because of the large amount of tourism it’s worth looking at short-term rental opportunities. Especially if the best property you find is close to a touristy area.
A reasonable number of monthly rentals can often earn more than a full-time renter, and with short-term rentals you always have the ability to put rentals “on pause” when you will be out of town or just need a break.
Look at “Upward Trend” Neighborhoods
Some neighborhoods might not look great now, but have clear signs of improving. Talking to locals and figuring out what places are better than they were five or ten years ago, which areas are seeing a drop in crime instead of a rise in crime, or where several properties have been bought and renovated can lead to neighborhoods that are actually undervalued because they are setup to improve and grow over the next few years.
Those neighborhoods showing “upward trends” are worth a look when they’re on the borderline of what you were considering.
It is worth noting that depending on the overall situation in the city, local investment, economy, etc., that there isn’t always a clear neighborhood that is turning around or moving upward versus not.
However, there’s almost always some blocks, some areas of neighborhoods, or blocks targeted for expansion by businesses or colleges for expansion and those areas are prime places to invest.
Because even if you’re bought out after a few years of house hacking, if you do this right it’s almost always for far more than you owe and often more than the current retail value of the property.
All the best!
NETWORTH BUILDERS5236 Reviews
14 Replies
- Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes3y
Your main focus should be to have your tenant cover your mortgage. Downtown San Antonio is affordable and doable.
- 3yHamp Lee IIIPro MemberReal Estate Agent · San Antonio, TX · Member since 2019 · 1k+ posts · 832 votes
Welcome to BP!
Many of the areas you listed are great for house hacking, and you can find a good deal, but some of them are not in ideal areas.
I would love to chat further about your desire to house hack in San Antonio.
I wish you all the best!
- Member since 2022 · 75 posts · 42 votes3yHouse hacking is one of the best strategies for investing right now. I think it makes a lot of sense for the San Antonio market.
Quote from @Todd Thompson:
Hello BP Community!
I am just starting my investing journey, but I have been listening to BP for almost 2 years now, doing a lot of research, and getting myself into a better situation financially. I've narrowed down the cities I am looking to invest in, and San Antonio is at the top - specifically I am looking at zip codes 78205, 78215, 78202, 78212, 78209, and parts of 78204 and 78210. I am going to house hack as my strategy, and my goal is to buy within the next 6-9 months.
Is there anyone with any experience house hacking in San Antonio? Can anyone speak to these specific submarkets/zip codes?
I have yet to speak with an agent or a broker, but will be looking for ones that are investor friendly.
Background that may be useful:
- Currently have a remote W2 job, with no intention of leaving it
- Ideally looking for an area that provides 60/40 appreciation to cash flow, if such a thing exists
- Happy to provide more info or details about my situation/buy box/strategyThanks in advance!
Todd
Another form of house hacking is rent by the room. There’s new construction here that qualifies for USDA no money down AND they are buying down the interest rate.
I’m an agent on the Investment Team at PMI Birdy properties. Let me know if you would like to schedule some time to talk more - Member since 2021 · 12 posts · 6 votes3y
Quote from @Eliott Elias:
Your main focus should be to have your tenant cover your mortgage. Downtown San Antonio is affordable and doable.
Thanks Eliott! At this point I'm more interested in appreciation than cash flow, but if it cash flows great. You think I should be looking more for cash flow?
- Member since 2021 · 12 posts · 6 votes3y
Quote from @Hamp Lee III:
Welcome to BP!
Many of the areas you listed are great for house hacking, and you can find a good deal, but some of them are not in ideal areas.
I would love to chat further about your desire to house hack in San Antonio.
I wish you all the best!
Thanks Hamp! I may take you up on that!
- Member since 2021 · 12 posts · 6 votes3y
Quote from @Tiffanie Figueroa:
House hacking is one of the best strategies for investing right now. I think it makes a lot of sense for the San Antonio market.Quote from @Todd Thompson:
Hello BP Community!
I am just starting my investing journey, but I have been listening to BP for almost 2 years now, doing a lot of research, and getting myself into a better situation financially. I've narrowed down the cities I am looking to invest in, and San Antonio is at the top - specifically I am looking at zip codes 78205, 78215, 78202, 78212, 78209, and parts of 78204 and 78210. I am going to house hack as my strategy, and my goal is to buy within the next 6-9 months.
Is there anyone with any experience house hacking in San Antonio? Can anyone speak to these specific submarkets/zip codes?
I have yet to speak with an agent or a broker, but will be looking for ones that are investor friendly.
Background that may be useful:
- Currently have a remote W2 job, with no intention of leaving it
- Ideally looking for an area that provides 60/40 appreciation to cash flow, if such a thing exists
- Happy to provide more info or details about my situation/buy box/strategyThanks in advance!
Todd
Another form of house hacking is rent by the room. There’s new construction here that qualifies for USDA no money down AND they are buying down the interest rate.
I’m an agent on the Investment Team at PMI Birdy properties. Let me know if you would like to schedule some time to talk moreThanks Tiffanie! I'm pretty much looking for small multifamily, and a couple other options - I'm not really interested in renting out by the room. I thought USDA loans were more for rural areas?
- Member since 2022 · 75 posts · 42 votes3yYou are correct. In San Antonio they are building new construction neighborhoods just outside the city limits that qualifies for USDA. It is also near a large training air force base which would work great for rent by the room or just house hacking in general. Renting by the room is certainly not for everyone. Even “traditional” house hacking is great considering todays interest rates and then if you use one of the units as an STR it’s an equation for success. House hacking a 2-4 MF unit is definitely a great strategy that would work in SA
Quote from @Todd Thompson:
Quote from @Tiffanie Figueroa:
House hacking is one of the best strategies for investing right now. I think it makes a lot of sense for the San Antonio market.Quote from @Todd Thompson:
Hello BP Community!
I am just starting my investing journey, but I have been listening to BP for almost 2 years now, doing a lot of research, and getting myself into a better situation financially. I've narrowed down the cities I am looking to invest in, and San Antonio is at the top - specifically I am looking at zip codes 78205, 78215, 78202, 78212, 78209, and parts of 78204 and 78210. I am going to house hack as my strategy, and my goal is to buy within the next 6-9 months.
Is there anyone with any experience house hacking in San Antonio? Can anyone speak to these specific submarkets/zip codes?
I have yet to speak with an agent or a broker, but will be looking for ones that are investor friendly.
Background that may be useful:
- Currently have a remote W2 job, with no intention of leaving it
- Ideally looking for an area that provides 60/40 appreciation to cash flow, if such a thing exists
- Happy to provide more info or details about my situation/buy box/strategyThanks in advance!
Todd
Another form of house hacking is rent by the room. There’s new construction here that qualifies for USDA no money down AND they are buying down the interest rate.
I’m an agent on the Investment Team at PMI Birdy properties. Let me know if you would like to schedule some time to talk moreThanks Tiffanie! I'm pretty much looking for small multifamily, and a couple other options - I'm not really interested in renting out by the room. I thought USDA loans were more for rural areas?
- 3yWale LawalBusiness MemberReal Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
San Antonio has a solid demand for rentals in addition to attracting its fair share of tourists. Because of this there are many great strategies we can employ to find a good deal house hacking in this Texas city.
Here are five of the best house hacking strategies for San Antonio.
Look at Multi-Unit Properties Like Duplexes
The mean prices for properties in San Antonio show a cheaper price for multi-unit properties like duplexes, triplexes, or other similar multi-unit properties. This is great news if you’re looking for a house hack because it makes it easy to have your slice of privacy while also having units ready to rent.
Based on the average monthly mortgage payment for a low down payment FHA loan, the mean rent from one unit would cover all but approximately $100 of the mortgage payment.
Keep in mind there are taxes, repairs, etc, but that’s true of any house and if you have a triplex, a 4-unit property or manage a better than average interest rate, or put down a down payment of more than 3.5%, then the deal starts looking very good.
Check out our free house hacking calculator to work with more precise estimates.
Location Matters in San Antonio
Neighborhoods can vary greatly in San Antonio. This is in regards to school quality, average income, quality of the housing, crime rates, and more. This is a city that tends to be neighborhood heavy – meaning there are a lot of different areas considered neighborhoods that have the population of small towns.
So a lot of 3,000 person neighborhoods versus 15,000 person neighborhoods. The quality of neighborhood is important, but location also matters because San Antonio is a prime area for Airbnb which really opens up the cash flow potential from house hacking.
Pay attention to the potential properties that are close to sites like The Alamo, Six Flags, or within a reasonable distance of UTSA. These have an even higher short-term rental potential.
Know All Your House Hacking Financing Options
Explore all your options when looking at how to finance a house hack. As we've covered before, many specialty loans are allowed for investment properties as long as the person is also living there. This is why ideas like VA loans for house hacking are worth exploring.
VA loans for veterans
FHA first time home buyers’ loans
Conventional bank loans
Fannie Mae & Fannie Mac housing loan programs
Seller-based financing
Some of these are very easy to get approved for while others require more paperwork, steps, or negotiation.
Don’t settle just for the easiest route. If the easiest route gets you the best rates that’s great, but it’s important to do all the work to see what your options are and weigh the pros and cons of each.
Keep Short-Term Rental Possibilities in Mind
Don’t limit your options. While you may like the security of a long-term rental for a house hack, because of the large amount of tourism it’s worth looking at short-term rental opportunities. Especially if the best property you find is close to a touristy area.
A reasonable number of monthly rentals can often earn more than a full-time renter, and with short-term rentals you always have the ability to put rentals “on pause” when you will be out of town or just need a break.
Look at “Upward Trend” Neighborhoods
Some neighborhoods might not look great now, but have clear signs of improving. Talking to locals and figuring out what places are better than they were five or ten years ago, which areas are seeing a drop in crime instead of a rise in crime, or where several properties have been bought and renovated can lead to neighborhoods that are actually undervalued because they are setup to improve and grow over the next few years.
Those neighborhoods showing “upward trends” are worth a look when they’re on the borderline of what you were considering.
It is worth noting that depending on the overall situation in the city, local investment, economy, etc., that there isn’t always a clear neighborhood that is turning around or moving upward versus not.
However, there’s almost always some blocks, some areas of neighborhoods, or blocks targeted for expansion by businesses or colleges for expansion and those areas are prime places to invest.
Because even if you’re bought out after a few years of house hacking, if you do this right it’s almost always for far more than you owe and often more than the current retail value of the property.All the best!
NETWORTH BUILDERS5236 Reviews - Real Estate Agent · Emerald Coast, FL · Member since 2016 · 820 posts · 486 votes3y
Don't overlook Homes.mil as a place to list your STR, MTR, or LTR. The huge military presence in SAN makes that very attractive as a source of tenants. I currently rent to a military police officer.
- Member since 2021 · 12 posts · 6 votes3y
Thanks for the super detailed response! Going to dig into this.
- 3yJordan MoorheadBusiness MemberReal Estate Agent · Austin, TX · Member since 2015 · 5k+ posts · 3k+ votes
We have an amazing contact in San Antonio for an agent, property manager and also a good contractor!
The Moorhead Team5140 Reviews - Rental Property Investor · San Antonio, TX · Member since 2017 · 61 posts · 32 votes3y
Quote from @Jordan Moorhead:
We have an amazing contact in San Antonio for an agent, property manager and also a good contractor!
Jordan, can you send contractor and agent info please?
- Member since 2022 · 19 posts · 1 vote3y
Quote from @Jordan Moorhead:
We have an amazing contact in San Antonio for an agent, property manager and also a good contractor!
Could you share your referral for a contractor?
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