All Forum Posts by: Ben Firstenberg

If you're in LA, finding a house hack is going to be tough. A realtor may be able to help, but likely they would just help you find locations where prices are lower and closer to your budget. They don't have access to "special deals" or anything. 

Have you considered buying just a single family home and renting out extra rooms? Multi family buildings in competitive markets like LA (and here in Atlanta) are typically expensive, hard to come by and competitive. Making them not so great options for house hacks. Single family homes with extra bedrooms, however, are much more common and typically can be found cheaper. 

Hope that helps!

I could be wrong, but by Northern VA, I assume you mean the DC area?

If so, I'm not surprised. Real estate in DC is sometimes just as competitive as New York or Chicago. Due to the government presence, your investment is incredibly secure compared to other cities and as a result, cap rates and cash flow will be lower. 

My advice would be to pursue a rent by the room model. Maybe something like FurnishedFinders. That's the "only" option, really, in these super competitive markets. It's what we do here in Atlanta too. After you've owned it for a few years, maybe paid down the mortgage, maybe rates come down... then you can refi and maybe make it work as an LTR.

Furthermore, your price point may be too high. I know it's a competitive market, but with the numbers you gave I calculate a purchase price of around $550k for a 1 bedroom? I have no idea what a typical 1 bedroom sells for in that area, but $550k for a 1 bed won't work as an investment anywhere outside of Manhattan

I think I would hire help when you get to the point that you're missing out on great deals because you're too busy working on existing deals.

Furthermore, if your flipping strategy relies on you and your husband doing almost ALL of the labor, your business model may not be very strong. Or maybe the deals you're finding aren't very good. I'm sorry, I don't mean to criticize. What you're doing is admirable. All I'm saying is, you may need to work on finding better deals so that you can afford to pay a GC and other contractors while still turning a profit. Unless, of course, you WANT to be doing the work yourselves and enjoy doing so, which would be very different. 

Hope that helps!

Hey AJ, I'm no expert in the Austin market, but I think you could accomplish a house hack without taking on a partner. Remember, you don't want to buy the median home. Not even close! If you're serious about a house hack, you want to buy something ugly and in the suburbs. You're in the business of bargain hunting now. 

Furthermore, my guess is you're not going to be able to make it work with a multi family house hack. That strategy doesn't work here in Atlanta and I assume the markets are similar. 2-4 unit properties are going to be really expensive and your cash flow won't be good when you're trying to live in one of the units. I would recommend pursuing a rent by the room model OR looking for a home with an in law suite that you can live in while renting out the rest of the house. 

I don't know anything about the neighborhood or anything else, and I only looked for about 30 seconds, but something like this looks like a great house hack. https://www.zillow.com/homedetails/6405-Moonglow-Dr-Austin-T...

Probably your best bet would be some kind of hard money or asset based loan. You could try a DSCR loan, but they wouldn't count your rent by the room leases, they would look at "market rents" as if you were leasing the entire property to one tenant.

For hard money and asset based loans, they only check your credit score. They don't much care about your income or personal finances. Of course, the interest rates will be higher, which may destroy your cash flow, but buying another house solves that pretty quickly. 

Good luck!

Hey David, 

I agree with what others have said. I've never asked a buyer to sign an exclusivity agreement. I don't think an agent is a "bad person" or anything for asking you that, but it's also not really necessary. 

From an agent's perspective, It's necessary when working with owner occupants buying a home to live in, because they might buy 1 home in 30+ years. If the agent gets screwed on that deal, they might never get another chance with that client. But investors tend to buy multiple properties over the years, so there's no pressure to make sure the agent gets paid for that one particular deal. 

For my part, it doesn't much matter to me. I like to let my work speak for itself. If you want to work with other agents, that's fine. I just ask that you be upfront and honest about what's going on. And if I bring you the deal, I do expect to get paid on it. Most investors are fair and reasonable people, so I don't worry about it

I own property in Cleveland and grew up there. One nice thing about the city is, there's a lot of mid level housing. 4-50ish unit apartment buildings. And they're not super expensive either. Cash flow is also pretty solid in most parts of the city. 

Couple of tips:

- Keep an eye out for property taxes. The city overall has pretty high taxes, but some suburbs are much higher than others. My property taxes almost doubled in my first year. 

- Your comment about "house quality" is somewhat interesting. The city is rather old and definitely "rust belt" territory. You'll find a lot of old, but solid homes. Maybe that's what you're looking for?

- If you want to be in the "trendy" parts of town, check out Ohio City and Lakewood. If you want to speculate on a location that could have really big growth, check out Opportunity Corridor (yes it's really called that, gotta love it!)

- Don't get too excited about appreciation. You buy it for $X in 2023, it'll probably be worth $X in 2033. The city is not growing. 

Hope that helps! Good luck

Agree with @Jaron Walling here

Situations like these are how investors get put into corners and bad things can happen. You only want to make an investment if it's "Hell yeah!". You buy a property you don't really want, that's cash flow negative, in a city where you no longer live... that does not sound like a hell yeah to me

There will be other opportunities

Hey Kino, 

I personally would recommend checking out Padsplit. This is a MTR, rent by the room platform that is very long distance friendly. Essentially, Padsplit will source and screen the tenants for you, then another property manager will handle day to day logistics. 

We've worked with a lot of long distance investors with this model, and it works quite well. 

With $100k, I'd look to buy a property for around $200-250k (20-25% down) and use the remainder to add extra bedrooms to outfit for a MTR, rent by the room model. 

We've done this a lot and typically you need about $125k or so, but it could be done for $100k