Kinda House Hacking

[Kathryn Bond]

So I know this isn't really "house hacking", but I wasn't sure where to put the post. My husband and I are currently buying another house (2300 sqft, 4/2), and plan to rent out our current house (1800 sqft, 4/2). I'm a veteran, so we are using the VA loan with 0% down to buy the second property. I plan on buying a third property and renting out the second, after the 1 year occupancy requirement, but am wondering what should be in the buy box?

Is 2300 square feet is on the bigger side of what we should be targeting? The main issue is, since I'm using VA benefits to purchase these properties, I have to live in them, and because of this, they have to meet a threshold of what my family is willing to accept. I have a husband and two small children. Should our third property be something more in the 1800 sqft range again? Or am I just over thinking this? The area is growing tremendously, both houses are in great school zones.

[Jackson Ebersole]

Hi Kathryn,

It sounds like you're on an exciting journey with your real estate investments! Given your plans to use VA loans for multiple properties, it's important to consider a few key factors when deciding on your next purchase.

Since you're already using a VA loan for the 2300 sqft home, it's understandable to think about the size of your future properties. While 2300 sqft is on the larger side, it's not necessarily a drawback, especially since you need to live in the property for at least a year. The space should accommodate your family comfortably, so if it meets your family's needs, it could be a good fit.

When considering your third property, think about what works best for your family. An 1800 sqft home could be a great option again, especially if it’s in a desirable area with good schools. It’s not uncommon to feel like you’re overthinking it—finding the right balance between investment potential and family comfort can be tricky.

Since both your current and future properties are in a growing area, focus on the overall market trends and the amenities the neighborhoods offer. Look for properties that are likely to appreciate in value, as this can benefit you when you decide to rent them out.

Ultimately, your buy box should include properties that meet your family’s needs while also having strong investment potential. Don’t hesitate to reach out to local real estate professionals who can provide insights into the market and help you find properties that align with your goals. Good luck with your investments!

Jackson

[Joey Banasihan]

Hey @Kathryn Bond!

I would definitely say this is house hacking, as you are purchasing and living in a home with the intent of making it a rental. What you are doing is what my wife have been doing, as to why we are also on rental number 3. 

Focusing on areas that will appreciate well is super important, as equity down the line becomes a huge game changer when growing your portfolio. As it was mentioned before, I would reach out to local investors, folks who have property management companies, and find out the market rents, vacanies, and demand for the type of homes you are purchasing. For example, here in Boise a 4/2, 1800sqft+,3 car garage will offer the highest amount of market rent, is the most popular home to rent, highest quality tenants and they average staying there for 4+ years. 

The difficulty is always going to be whats "most comfortable" for your family and what property will provide the highest return/ROE to help build a life of financial freedom for your family. Hopefully this helps and good luck with your next steps!

[Drew Sygit]

Jump on Zillow and look at the rental listings in your area.

The data should allow you to do a rough comparison of price/sq ft.