All Forum Posts by: Andrew Powers

Have you run numbers with PMI and low down payment vs no PMI and high down payment? Depending on how much your PMI would be, your required margins, and your long term strategy... it can make sense to pay the PMI if your out of pocket cost is low and your returns are acceptable.

Given the market uncertainty in the near future and for you just starting out, it is often recommended to conserve cash.

Hey Xavier, I still think having an in house manager even if it's a year or 2 could be worth it. You probably cant expect the in house roommate manager to be as professional as an actual PM but if they get discounted rent and you have a lot less management overhead, it can be a win win as long as it is structured right. This also plays into making sure tenant screening brings in solid roommates.

Depends on your risk tolerance and your drive to get the first deal done. Is 7% return based on being conservative with the numbers or not? Without being able to see into the future, are you willing to buy at a lower return based on the information you have about potential market growth? Can you justify this first deal as a property to learn with and have the cash reserves to cushion you in case things go bad in the market or with the property? Just some things to think about as everyone and every situation is different.

if theres a PM company in your area that is OK with or specialized in cheaper rentals in the range of how much it costs to rent a room, try to find that.

I started to house hack recently with renting rooms and wont be living in the house forever. When I move out I have a couple of strategies. A. Rent the house as a single family, which is often less returns but less management. B. Rent the rooms, and have one of the roomates manage that 1 property and give them a rent discount. They will be the point person to you, and they are responsible for enforcing the lease, and potentially finding new roomates and fixing the small things depending on how much you discount their rent. Structure the lease to have EVERYTHING in it including roommate duties like keeping things clean, doing dishes within xx time, payment, etc. Having the in-house property manager is incentivizing for that person to keep your property (their living space) in good order.

Ask them if they want to renew... seems like the logical next step. If they dont want to renew, look at Zillow. People are doing virtual showings on their houses. If your tenants dont feel comfortable having you in there take pics or video, have them do it and give them a few bucks I'm return. If they dont want to do that, use old pics from when you rented it out to the current tentant. If dont have old pics, provide something on else of value that a potential tenant would want to see or understand when looking at a house.

Analyze the property like you would a normal rental. If the numbers work well for that, then it should be fine to house hack... consider things like property taxes, utilities, loan rates, etc are different if you live there or don't. But you never know if/when you living situation will change and if you need to move and rent out the house instead of house hack. If you don't know how to analyze a property then continue to read, go to BP podcast, go to YouTube for Brandon Turner videos to show how to use the BP calculators. 

In terms of other stuff, make sure it's a place you want to live. I just started to house hack a few months ago and it is awesome. Just know your numbers.

I recommend using the bigger pockets calculator... seems like you have many of the numbers to input to the calculator... it's really easy to use. Use the calculator, be conservative with the numbers, and see what you get. If the returns (cash flow, COC ROI, etc) are aligned with your goals, then keep it. If not, then investigate modify the numbers you put in the calculator if it makes sense, or if you could do something different with the property (ie more updates to get more rent $?).

If you are strapped for cash, then sell it?

Hi Jenelle,

In my case, my realtor is an investor but has different investing goals so we are not after the same things. 

Even if you/your realtor were after the same properties, depending on if the realtor sees value investing their time into you, or even if you could help them out in some way with their properties, maybe an opportunity could arise that they would pass along a deal to you that doesn't exactly meet their plans or you could partner, etc.  

All this being situation dependent but hope this helps.

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Anyone is welcome to come to the meetup tomorrow in Troy, just outside if Detroit:

https://www.biggerpockets.com/forums/521/topics/71...