Professional · Dallas, TX · Member since 2016 · 8 posts · 3 votes
Hey Bigger Pockets Nation,
I'm actively searching to buy a 4-family in the Dallas area
-I have about 30k-50k for a downpayment ready to go
-1st property
-looking at off market deals
-I would be living in one of the units (owner occupied)
-Updating the units: kitchen, bathrooms, and adding in unit laundry
-Would refinance after a year
For financing purposes should I go through a small bank or a loan officer? Should I just put 5% down or what would you recommend? Also for those that have done off market deals do you just bring a contract with you when you meet? Do you put anything special in the contract? OR what would you have done differently?
Lender · San Antonio, TX · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Matthew Cassidy@Ronald Rohde has good suggestions. One thing I would add is that looking for 'off-market' properties can sound like the sexy thing to do in real estate, but the reality is unless you are 1) buying in cash or some near cash loan equivalent and 2) planning to look for off-market properties on a large scale, I think you will be spinning your wheels. The reasons that owners let properties go for below-market value rather than listing them with an agent is the speed and ease with which the transaction will be closed. There is nothing fast or easy about closing an owner-occupied 4 unit property with 5% down. You will have more luck looking at what the MLS has to offer and going from there.
Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
6y
I think you need to clarify, most people don't consider 4 units multi-family. From a lending perspective its 1-4 unit residential. That said, whats your monthly cash flow from your job? I'd put as little down as possible and plan to renovate the worst unit (the one you live in). As the leases expire, move into the worst units and keep rehabbing until all 4 are renovated and getting top rent. I posted your exact scenario on my YT channel :)
Lender · San Antonio, TX · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Matthew Cassidy@Ronald Rohde has good suggestions. One thing I would add is that looking for 'off-market' properties can sound like the sexy thing to do in real estate, but the reality is unless you are 1) buying in cash or some near cash loan equivalent and 2) planning to look for off-market properties on a large scale, I think you will be spinning your wheels. The reasons that owners let properties go for below-market value rather than listing them with an agent is the speed and ease with which the transaction will be closed. There is nothing fast or easy about closing an owner-occupied 4 unit property with 5% down. You will have more luck looking at what the MLS has to offer and going from there.
Lender · Fort Worth, TX · Member since 2016 · 8k+ posts · 6k+ votes
6y
@Matthew Cassidy since you are buying this as your primary home you will find a lot more options. Buying off market multi-family properties in DFW is really difficult. But you could certainly find a good 2-4 unit property and just use a standard FHA loan with 3.5%. Using a conventional loan would require 25% down. It's a big difference for sure. Feel free to ask anything additional if you need. Thanks!
If you will be living there, your best option is to get an FHA (203)k loan which will only require 3.5% down and you can roll the cost of the remodel into the loan.
@Justin Webber-Blackwell I am also having the same issue. I've been pre-approved for an FHA loan but the duplexes I've seen in class A and B neighborhoods do not cash flow. I also haven't seen anything more than a duplex in the Frisco, Plano, Carrolton, Richardson, McKinney, Celina, and surrounding areas.
You could try Craigslist but it's a gamble. I've seen 2+ units in the Arlington area but haven't investigated further. I'd be interested in hearing any recent successes buying in the 2-4 unit range in the Dallas area.
New to Real Estate · Dallas, TX · Member since 2020 · 94 posts · 20 votes
6y
Hello guys
I have one house in a very nice neighborhood in N.Dallas. 4beds 4baths Duplex $450k. If this fit criteria, and you want more details, please let me know.
Real Estate Broker · Coppell, TX · Member since 2011 · 5k+ posts · 4k+ votes
6y
@Matthew Cassidy This is a tough find. #1 we don't see a lot of off-market multi-family. I always say there is not a lot of multi anyway in most desirable areas of DFW. More and more of what I see is pricey, but that's not to say it is impossible, just rare it seems. Don't forget on-market properties. Those will probably be much easier to find.
These days the better house hack seem to be buying a 4-5 bedroom 3bath house and rent rooms vs buying multi, so consider that option too.
It's been 3 months since your post....so how is the search going? Finding what you want yet?