House Hacking My First Investment Property!

[Sophie Grizzle]

Hey Everyone! 

I'm super excited that 2023 is going to be the year I buy my first investment property. I just relocated to Pensacola, Florida and I'm on the hunt for a deal. I'm planning to use my FHA loan to buy a small multi-family property (2-4 units), or a single-family with the potential to rent out a bedroom or ADU.

As a first-time homebuyer & house hacker - I need all the tips! 

What do you wish someone told you when you were buying your first investment or house hacking for the first time? 

[Noah Bacon]

Hey Sophie,

2023 is going to be YOUR year! 

When I was buying my first investment (which was a house hack!), I wish I would've started the leasing process sooner. I bought my property entirely remotely, and once I physically moved in that is when I started to look for leasing resources. If I had started looking for leases or an attorney to draft the leases while I was under contract, I would've been able to market the property sooner, and ultimately get my first rent check!

It slowed down the process by about 2 weeks, which isn't the end of the world! My second time around, I was much more prepared for this with professionals and leases in place. 

[Khudee J Lawrence]

Hello everyone,

Good luck Sophie!!! I’m a new investor and also trying to get started in 2023. I’ve learned so much from this thread already, thank you all for sharing your experiences and knowledge. Keeping my eyes on this thread to see where things land.

Best,

Khudee

[Matthew Kwan]

Congratulations Sophie,

You should always look into single family houses or multifamily, as there is an actual land that you own and potentially build ADU/DADU in the foreseeable future. Also, the beauty of FHA is that it allows you to put 3.5% down payment to invest in 1-4 units and rates tends to be lower than conventional. However if you plan on buying 3-4units, there is a trigger rule for FHA, it is called the self sufficiency test. In order to past this SS test, your market gross rental income at 75% has to be more/equal to your monthly mortgage payment (PITIA). These are something to be considered. Feel free to DM and we can talk more about it @Carlos Valencia @Albert Bui
As for conventional, there are no specific tests to pass but down payment would require more than fha depending on the unit. Usually 15%-25% down payment for 2-4 units and 5% down payment for single family. Also, the mortgage insurance is slightly lower than FHA private mortgage insurance.