New to Bigger Pockets - Looking to Make 1st investment

Chicago, Illinois
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New to Bigger Pockets - Looking to Make 1st investment

Jacob Nevarez
New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes

Hello, 

Nice to meet everyone! I am a new listener to the channel and looking to make my first investment. After years of saving, I finally have enough for a nice downpayment on a multi-unit or SFH. I'm looking to get pre-approved sometime next week or potentially by the end of the week. I'm excited to start this real estate journey, which is entirely new to me. Everyone I have met in my profession and/or family are either renters or SFH homeowners, so my only guidance on investing has been from the podcast and YouTube, LOL! Always open to connecting with experts, especially in Chicago, or even people starting their journey.

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Wale LawalBusiness Member
Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
1y

@Jacob Nevarez

To make a successful real estate investment, get pre-approved by a lender, consider multi-unit or single-family home options, research the Chicago market, and network with local investors. Building relationships and learning from others can help avoid costly mistakes and ensure the property will cash flow or break even in worst-case scenarios.

Good luck!

[email protected]832-776-9582Podcast Guest on Show #469
NETWORTH BUILDERS5236 Reviews
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  • Andrew SyriosPro Member
    Moderator
    Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
    1y

    Welcome to BiggerPockets Jacob! If you're open to moving, house hacking is the best way for most people to get started in real estate investments. If that's what you're looking for, you should definitely check out @Craig Curelop's book The House Hacking Strategy: https://www.amazon.com/House-Hacking-Strategy-Achieve-Financ...

    Podcast Guest on Show #121
    0Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    Hey Andrew,

    I have considered house hacking before. The only dilemma is that my fiance and I have a one-year-old daughter. So, trying to convince her to have a stranger share a bathroom might be the most challenging feat I've faced. 

    I have heard some stories of people starting out by house hacking. Is that how you started out investing?

    0Reply
  • Craig Warner
    Lender · Nationwide Lender / Novus Home Mortgage, a division of Ixonia Bank / NMLS #423065; Craig Warner / NMLS #129642 · Member since 2024 · 78 posts · 15 votes
    1y

    Perhaps purchase a duplex living in one unit and renting out the other. FHA 3.5% downpayment, but other options available too.

    0Reply
  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    1y

    @Jacob Nevarez

    To make a successful real estate investment, get pre-approved by a lender, consider multi-unit or single-family home options, research the Chicago market, and network with local investors. Building relationships and learning from others can help avoid costly mistakes and ensure the property will cash flow or break even in worst-case scenarios.

    Good luck!

    [email protected]832-776-9582Podcast Guest on Show #469
    NETWORTH BUILDERS5236 Reviews
    WebsiteView Page
    2Reply
  • Jonathan KlemmBusiness Member
    Moderator
    Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
    1y

    What's up @Jacob Nevarez!  Welcome to BiggerPockets and the Chicago Real Estate Community!

    It is amazing to hear that you are breaking the chains and doing something totally different than anyone around you - THAT IS NOT EASY - Kudos to you sir!

    Is there any specific neighborhoods of Chicago that you are thinking of investing in?  What is your price point?

    Consider linking up with @Zack Karp or @Landon Hoon both great local Chicago lenders.

    I'd also consider checking out some in-person meetups...they are usually a great way to build a strong network.   Here is where BP has some local events listed:  https://www.biggerpockets.com/forums/521-real-estate-events-...

    [email protected]
    Quality Builders4.966 Reviews
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  • Paul De Luca
    Real Estate Agent · Chicago, IL · Member since 2018 · 1k+ posts · 1k+ votes
    1y

    @Jacob Nevarez

    Welcome! That's great you're taking action and ready to get your first investment.

    It depends on your buying criteria and situation, but my general advice is to house hack a 2-4 unit property rather than a SFH. A SFH could make sense as a house hack if you found one that has an in-law arrangement but otherwise I'd say 2-4 units is the way to go.

    If house hacking doesn't make sense for you & your family, you'll likely need 20-25% down for an investment loan to buy & hold a property you won't be living in. It takes a lot more capital than house hacking.

    1Reply
  • Paul De Luca
    Real Estate Agent · Chicago, IL · Member since 2018 · 1k+ posts · 1k+ votes
    1y
    Quote from @Jacob Nevarez:

    Hey Andrew,

    I have considered house hacking before. The only dilemma is that my fiance and I have a one-year-old daughter. So, trying to convince her to have a stranger share a bathroom might be the most challenging feat I've faced. 

    I have heard some stories of people starting out by house hacking. Is that how you started out investing?


     You wouldn't be sharing a bathroom with a stranger since you would occupy a separate apartment. You live in one unit and rent the others out.

    0Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Craig Warner Buying a duplex and renting the other unit is the route I'm planning on taking. I'm trying to stay away from FHA and get a conventional to avoid the FHA insurance.

    What other options are available? 

    0Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Wale Lawal
    Thank you for the tips! Do you know any investors in Chicago that are willing to connect? 

    0Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Paul De Luca

    Thank you for the insight! I had thought house hacking meant living in a SFH and renting out the bedrooms. But yes, my wife and I plan on investing a du/triplex and living in one unit as a primary residence. Just trying to find the location to invest in is the tricky part.

    1Reply
  • Craig Warner
    Lender · Nationwide Lender / Novus Home Mortgage, a division of Ixonia Bank / NMLS #423065; Craig Warner / NMLS #129642 · Member since 2024 · 78 posts · 15 votes
    1y
    Quote from @Jacob Nevarez:

    @Craig Warner Buying a duplex and renting the other unit is the route I'm planning on taking. I'm trying to stay away from FHA and get a conventional to avoid the FHA insurance.

    What other options are available? 

    Owner occupied conventional purchase to 97%, but depends on income and or 95% conventional, USDA 100% income and are restrictions, or VA, no money down, if a veteran?
    But typically any conventional loan with less than 20% down payment you'll have mortgage insurance, but can either be borrower-paid or lender-paid.
    It's always good to review your situation with a lender, so you know your qualifications and budget. 
    1Reply
  • Mackaylee BeachPro Member
    Real Estate Agent · Kansas City, MO · Member since 2020 · 1k+ posts · 492 votes
    1y

    Welcome to Bigger Pockets, and congratulations on your decision to invest in real estate! Are you considering out-of-state investment opportunities? I would be delighted to assist you and provide insights into the current Kansas City market.

    [email protected]
    0Reply
  • Zack KarpPro Member
    Lender · Schaumburg, IL · Member since 2015 · 833 posts · 774 votes
    1y

    @Jonathan Klemm thanks for the tag!

    @Jacob Nevarez I agree with others here, the 2-4 unit house hack is the way to go. Some of the other financing info here is a little off though. You can buy a 2-4 unit with a Conventional loan with 5% down. Have you gotten preapproved yet to know what you can qualify for? That may determine or sway your location. Let me know if I can help you with that, I am local here and my niche is working with investors and house hackers, I have worked with hundreds of other BP members with their financing. Feel free to shoot me a DM if you want to connect.

    847-387-5513
    2Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Jonathan Klemm

    Yes, breaking the chains is super different especially in this realm. My parents and relatives are always shooting down the thought of multi-families. 

    I’ve been researching North and Northwest suburbs to invest but haven’t had a chance to research lenders.  Thank you for sharing contacts! 

    1Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Mackaylee Beach

    Thank you for reaching out! Currently plan to invest in the “backyard” Chicago. But been hearing that out of state has its advantages. If I find myself researching Kansas City, I will be sure to reach out. 

    0Reply
  • Paul De Luca
    Real Estate Agent · Chicago, IL · Member since 2018 · 1k+ posts · 1k+ votes
    1y
    Quote from @Jacob Nevarez:

    @Paul De Luca

    Thank you for the insight! I had thought house hacking meant living in a SFH and renting out the bedrooms. But yes, my wife and I plan on investing a du/triplex and living in one unit as a primary residence. Just trying to find the location to invest in is the tricky part.

    No problem! Living in a SFH and renting out the bedrooms is typically called the "rent by room" strategy. Once you're pre approved, you'll be able to hone in on the specific areas that make sense for your budget.

    1Reply
  • Samuel DioufBusiness Member
    Real Estate Agent · Columbus & Cleveland, OH · Member since 2023 · 1k+ posts · 1k+ votes
    1y

    Welcome to Bigger Pockets Jacob!

    SFH typically have lower cash-flow and higher appreciation while MFHs have higher cash-flow and lower appreciation.

    If you’re looking to invest in your backyard, it helps to network with as many local investors as you can. A great way to start is by attending RE events and joining a local investors association. You can usually find some events by doing a simple google search.

    [email protected]614-662-1652
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  • Riley Poppell
    Lender · Chicago · Member since 2024 · 88 posts · 24 votes
    1y
    Quote from @Jacob Nevarez:

    Hello, 

    Nice to meet everyone! I am a new listener to the channel and looking to make my first investment. After years of saving, I finally have enough for a nice downpayment on a multi-unit or SFH. I'm looking to get pre-approved sometime next week or potentially by the end of the week. I'm excited to start this real estate journey, which is entirely new to me. Everyone I have met in my profession and/or family are either renters or SFH homeowners, so my only guidance on investing has been from the podcast and YouTube, LOL! Always open to connecting with experts, especially in Chicago, or even people starting their journey.


    Hey Jacob! I read a few of the posts and would recommend talking with a lender in regards to the multi unit property since so far you have only watched videos on YouTube or podcasts. Understanding the investment in regards to how it will work long term is key in this case since you will likely be the owner for awhile (30-40 years is where you will see a huge increase in value if it is in the right location). The most important thing to focus on is the location (one that will be booming with new stores, increased home values, etc. because this will do great for your property). It's a long journey but I know it likely will be the most important investment and best money making investment of your life so congrats!

    1Reply
  • River SavaPro Member
    Lender · USA · Member since 2022 · 1k+ posts · 1k+ votes
    1y

    Hey Jacob -

    Welcome to BP and congrats on getting ready to make your first investment! Having a solid team around you agent, lender etc.—will be key as you navigate your first deal. Good luck and happy to connect and help where I can!

    [email protected]
    1Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Samuel Diouf

    Thanks for the tips Samuel! That's a good way to think about SFH and MFHs in terms of appreciation and cash flow. Right the goal is get a couple a hundred in cash flow with the first deal and then build upon there.

    I will be sure to check out some REÍ events in the area

    1Reply
  • John Mason
    Member since 2024 · 1k+ posts · 351 votes
    1y

    Welcome to Bigger Pockets ! You have come to the right place to begin your investing journey.

    Have you looked into attending local meetings and joining Facebook groups?

    Having a solid team around you agent, lender etc.—will be to success!!

    Awesome board with many smart people having own suggestions and ideas to grow wealth!!

    I wish you all the best in your investing journey!

    1Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @Riley Poppell

    I appreciate your honest feedback Riley! I’ve started at looking at different lenders this week and noticed that some offer grants that cover some cost to close.

    As for researching for different markets, what’s a good indicator that new stores will be opening up? 

    0Reply
  • Riley Poppell
    Lender · Chicago · Member since 2024 · 88 posts · 24 votes
    1y
    Quote from @Jacob Nevarez:

    @Riley Poppell

    I appreciate your honest feedback Riley! I’ve started at looking at different lenders this week and noticed that some offer grants that cover some cost to close.

    As for researching for different markets, what’s a good indicator that new stores will be opening up? 

    I'd be in touch with a realtor who knows the market well if I were you. They will be able to choose which market would be best to invest in. I have a referral for a good lender in your case that could help with the closing costs and a realtor as well. Let me know and I'll send it your way.

    0Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @River Sava

    Hey River, 

    Thank you for reaching out! I'm currently trying to build a team and find the right lender first. But in the meantime, I will be happy to connect with you!

    0Reply
  • Jacob Nevarez
    OP
    New to Real Estate · Chicago, IL · Member since 2021 · 21 posts · 16 votes
    1y

    @John Mason

    I started to look at local meetings, and I see that some coming up this weekend. I haven't thought to look at Facebook groups, but I will look into those. Would you recommend joining one that is a niche market (SFH, MFH, BRRRR etc.), or one that covers REI as a whole?

    Thank you of course for reaching out!

    0Reply
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