Newbie Question on Renting & Number Crunch

[Alex Royster]

Hello All,

I am relatively new to BP, have been doing a lot of research on investing and all the different routes that are possible. I feel that I am ready to jump in and get started, but had a few questions. 

Little background, I am active duty military and almost finished with a deployment. Which has led to a lot of time to learn the ins and outs as well as save a nice chunk of money to start things off. So as of now my plan is to use the VA Loan in order to house hack as soon as I make it back. I have been doing research on the usual sites (Zillow, Truilia, Realtor, etc) and believe to have a pretty good grasp on the numbers so far.

Except one section... which would be determining what rent you would charge your tenants. For example say that there is a SFH 3BD/2BA, the rent (with everything included) is said to be 869 a month, mortgage 658 so a total of 1527. Would that mean that in order for this to be a logical cash flowing investment the rent would have to be 600-800 for the two other tenants? I understand that the idea is to have the income higher than that number to cash flow. Also considering that I would occupy one of the rooms for a year to fulfill my VA Loan Requirements, what would be the ideal monthly rent to make this work? After the year requirements, the third room would be available for rent which could bring the rent of the other two rooms down a bit, but would allow for more income.

 I am stationed out of Ft Bragg NC, so I would most likely be renting to other military members. With that being said, majority of the tenants would roughly have an income of 2000/month. Considering the ballpark amount of income from potential tenants I feel that this would not be a sound investment to make.

All in all, when considering the rent to charge tenants for doing a house hack of a SFH (or even MFH), how would I go about figuring our a ball park estimate? Ive heard to look at what other houses are renting for, but if they are all SFH and are listed to rent for 900, do I divide that and the mortgage amongst the rooms?

My apologies for such a long post, just wanted to be as clear as possible. 

Any insight is greatly appreciated in advance, thank you for your time

[Kevin Bonner]

Hey Alex! First off, thank you for your service. Second, I'm pretty new to the site and to real estate investing, but have been studying how to look at some of these numbers for awhile now. I have a couple of additional questions.

1. Do you have a purchase price in mind

2. Property tax in your area (what city are you looking in)

3. Condition of the building

4. Are you saying the average rent for a 3Bed/2Bath is $869?

Without some of that info, it looks as if it may not be the best investment if you're looking for a long-term property to provide cash flow. Taking into account the other expenses associated with the SF house, it would be pretty tough to charge enough rent to cover all of the operating expenses. Looking into some multi-family homes may provide more opportunity, but I'm unsure exactly how the VA loans are set up.

I can give you a better break-down of the numbers with a little more info.