All Forum Posts by: Aaron Owen

Justin,

I am currently working through a new build deal with one of my family members in SW MN. The property that makes the most since when looking at the numbers is for the property to be 2-4 units. We choose to build a duplex due to the smaller lot size. However, my suggestion would be to speak with a local RE agent and see what the price and supply/demand are for certain bedrooms and bathrooms. I'd use that info to roughly plan out how many bedrooms/baths you can get into the property that would make sense based on the lot size and your budget. 

We choose to go down this path because we are in a similar position as you are. We can get interior/exterior finishes at discount due to myself being a PM and my family members owning and/or working as a contractor/design business.

Let me know if you want to chat sometime. 

Thanks,

Aaron

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $174,000
Cash invested: $18,000

I purchased this property as my 1st real estate deal and house hack with a FHA loan. I currently live in the house and list my the additional bedrooms and bathroom on Airbnb, VRBO & Booking.com to help offset the expenses. Thus my property brings anywhere between $1,000 to $2,000 each month allowing me to actually make money! While I am living here I plan to make value add renovations such as add a bedroom and a bathroom in the basement to increase the equity $20k - $25K.

What made you interested in investing in this type of deal?

Listening and learning around the BP community. House hacking is a great way to get into real estate by lowering my monthly expenses and allow me to slowly renovate the property over the course of one year.

How did you find this deal and how did you negotiate it?

I found this deal via my local agent Andrew Adam. We negotiated it down from $179k to $174k.

How did you finance this deal?

Financed this deal via a 3.5% down FHA loan.

How did you add value to the deal?

I plan to add value to the property by adding an additional bedroom and bathroom in the basement making it a 5/bed 3/bathroom home. Updating one of the existing bedrooms, kitchen counters, kitchen appliances, water heater, and updating the curb appeal with new landscaping, DIY shutters, staining/painting the existing fence and decks. The goal is to make the property attractive to a larger tenant base, once the property is stabilized I plan to refinance and pull out the created equity.

What was the outcome?

Currently in process of completing the renovations

Lessons learned? Challenges?

Spend a lot of time up front to establish processes and system for Airbnbing your property ensure the guests are not going to damage/steal items from your home.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I would highly recommend working with Andrew Adam, who is also a local REI. The lender I choose to go with is Plains Commerce Bank who were incredibly helpful throughout the loan process!

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $174,000
Cash invested: $18,000

I purchased this property as my 1st real estate deal and house hack with a FHA loan. I currently live in the house and list my the additional bedrooms and bathroom on Airbnb, VRBO & Booking.com to help offset the expenses. Thus my property brings anywhere between $1,000 to $2,000 each month allowing me to actually make money! While I am living here I plan to make value add renovations such as add a bedroom and a bathroom in the basement to increase the equity $20k - $25K as well as increasing the potential long term rental income. I am also updating the kitchen, bathroom, landscaping and exterior of the home to make it more appealing and add value prior to placing long term tenants and refinance out of the property.

What made you interested in investing in this type of deal?

Listening and learning around the BP community. House hacking is a great way to get into real estate by lowering my monthly expenses and allow me to slowly renovate the property over the course of one year.

How did you find this deal and how did you negotiate it?

I found this deal via my local agent Andrew Adam. We negotiated it down from $179k to $174k.

How did you finance this deal?

Financed this deal via a 3.5% down FHA loan.

How did you add value to the deal?

I plan to add value to the property by adding an additional bedroom and bathroom in the basement making it a 5/bed 3/bathroom home. Updating one of the existing bedrooms, kitchen counters, kitchen appliances, water heater, and updating the curb appeal with new landscaping, DIY shutters, staining/painting the existing fence and decks.

What was the outcome?

Currently in process of completing the renovations

Lessons learned? Challenges?

Spend a lot of time up front to establish processes and system for Airbnbing your property ensure the guests are not going to damage/steal items from your home.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I would highly recommend working with Andrew Adam, who is also a local REI. The lender I choose to go with is Plains Commerce Bank who were incredibly helpful throughout the loan process!

I have recently been looking at relocating to Honolulu for work. I have been doing research and it looks like Airbnb and other short terms rentals have really been cracked down on in the state. How hard is it to obtain a short term rental permit? Is it worth the hassle to enter the lottery? 

Thanks,

Aaron!

I appreciate everybody's advice and recommendations! It's super helpful in guiding me towards which route I want to go forward with when considering the different lenders out there. 

Thank you!

@Jordan Moorhead I guess I wasn't necessarily looking for a portfolio lender specifically for a FHA loan, but more for establishing relationships once I start looking for more deals using the Brrrr method.

In your experience have you seen any lender who offers better terms to FHA buyers?

@Randy Bloch I compiled the list from previous forum posts on BP.

Hey Everybody!

As I've been doing my research and reading through posts here on the forums I have found that the following are the best banks and/or credit unions in the Minneapolis, MN area to work with.

• Sunrise banks
• Firefly credit union
• Anchor Bank
• TCF Bank
• Highland banks
• Drake bank
• Bridgewater bank
• US Bank
• Eagle Valley
• First American Bank

My investment strategy is to start out by house hacking a duplex/triplex in the Minneapolis area. I will have enough cash set aside in approx. 8-12 months to buy my first property. I plan on getting a FHA loan or if possible a 203k loan I know they can be extremely difficult to qualify for but I have a brother who is a licensed contractor and I work for a major construction company in the area I'm hoping that would make the process a little more easier. Since, I have some time between now and then I'm looking to establish a relationship with a portfolio lender and hopefully get more favorable terms or even just an easy lender to work with.

So given my situation what portfolio lender would everybody recommend in the Minneapolis area? 

Hey BP,

Does anybody know of a good Real Estate Agent in the Battle Lake and/or Fergus Falls area in Minnnesota? Any recommendations would be great!! I've found a couple of houses that I'm really interested in.

Thank you in advance,

Thank you for your quick replies!