All Forum Posts by: Bradley Abramson

Hey William, I just posted a new update. I did most of the reno myself and was able to get renters in one by one as I improved areas within the house. I took their suggestions and was able to find a relatively good house without much major renovation. 

I am now fully rented out and have a good cashflow while also living for free! My next dillema is the 2nd and third home lol 

best, 

Bradley

Good morning! 

I am a relatively new investor that purchased my first house hack about 2 years ago. I bought in a great area (South of Denver) and have seen a significant appreciation on my property already. I have refinanced and removed the PMI I had initially, bought down to a lower interest rate (2.75%). I am now looking at getting a second within 3 months and third home within the year.

The second home will be out of state and will be used to help family, while also investing in a developing small town. The third home will be a primary residence in which I will house hack again and turn my current primary residence house hack into a full rental. 

I have gotten a preapproval and should be good for the second home. Instead of removing money from my long term stock investments, I am utilizing the appreciation and taking out a HELOC on the first home.

I reached out to a local credit union and got a good rate offer. Here is where my question comes into play. I got an initial HELOC offer of about 75k based on an online estimate. This estimate seems low (510k), especially when the appraisal when I refinanced (1 year ago) was 497k. The part where I get caught up, is that the redfin estimator is showing nearly the same value as the online appraisal (510k) and Zillow is showing nearly 575k. I know zillow is a little exaggerated and that redfin is "closer"

The appraisal however is going to cost me 700$ to get done. Currently there is a same sized house with newer exterior paint on my street for 550k, and others that have sold from 540-570k. Looking a price/square foot, the current appraisal is approximately 230, while homes are going/sold for 240-250 a square foot. 

Is it worth the extra 700$ and additional time to try to capture an extra 25-50k in HELOC?

Currently the 75k would be tight, but doable to purchase both homes in the future with roughly 5-10% down and closing costs. 

Any feedback or items I haven't thought about would be much appreciated. 

best,

Bradley

Thank you all for the responses. I have decided to move on from the house. It was to pricey with all the renovations needed and the numbers were being forced. I got excited and thought I wasn't going to find a better deal. I saw some more houses today and have found more prospects that work way better with numbers. Taking your suggestion, by buying more house I end up not needing to do any work and rent almost immediately. I am looking at about 5 bedrooms finished and about 385k. The loan would be more expensive, but with 4 roommates and myself "paying rent" I will be at 500+ cash flow after all expenses and cap ex savings. I am testing the market at a higher rate as some have suggested and still am getting a good response rate which would make this even better. I would save almost all of this until I have a good safety net. I have also changed to a more experienced realtor and spoke with multiple lenders to have a good understanding of the numbers I will be paying. Thank you guys for the responses. I have realized that by actual going out on the market I am quickly finding what is good value and what isn't. I am learning something each day and excited for the future. 

Hey Guys, 

I wanted to see if you guys could let me know if I am doing anything not advised for my first house hack.

I am currently looking at a single family house. It is a 3 Bedroom 2 bath house South of Denver (Columbine Area) for 350k. I was pre-approved for a loan and with all the interest, insurance, and principal the loan will be about 2250 a month. This loan is a conventional loan 3% down and can have the PMI removed after I hit 20%. I want to also do some renovations and make the downstairs basement extra room and turn it into a room by adding a wall and closet. I am estimating 30k for renovations of the whole house and will be 30,000k. The AVR's for a similar 3 bedroom house fully finished is 400k and 4 bedroom around 420k.

I have conducted a  dry listing to see if I could get interest and was able to 8 applications in 24 hours before I removed the listing at a rate of 700$ per room. I am employed and can definitely afford the mortgage by myself. I want to get a renovation loan out and fix the place up and potentially turn the garage into an apartment where I live and rent the full house out.

Is there anything I am missing? I am currently paying 700$ in rent. The loan would be 35% of my before tax income and roughly 60% of my after tax, health insurance, and retirement account. I have enough for the down payment and will have at least 3 months of mortgages payments by the time of closing. I know that for a typical rental this would be 

Thanks for the help and if you need anymore information I would be glad to provide.  

Hey Guys, 

I wanted to see if you guys could let me know if I am doing anything not advised for my first house hack.

I am currently looking at a single family house. It is a 3 Bedroom 2 bath house South of Denver (Columbine Area) for 350k. I was pre-approved for a loan and with all the interest, insurance, and principal the loan will be about 2250 a month. This loan is a conventional loan 3% down and can have the PMI removed after I hit 20%. I want to also do some renovations and make the downstairs basement extra room and turn it into a room by adding a wall and closet. I am estimating 30k for renovations of the whole house and will be 30,000k. The AVR's for a similar 3 bedroom house fully finished is 400k and 4 bedroom around 420k.

I have conducted a  dry listing to see if I could get interest and was able to 8 applications in 24 hours before I removed the listing at a rate of 700$ per room. I am employed and can definitely afford the mortgage by myself. I want to get a renovation loan out and fix the place up and potentially turn the garage into an apartment where I live and rent the full house out.

Is there anything I am missing? I am currently paying 700$ in rent. The loan would be 35% of my before tax income and roughly 60% of my after tax, health insurance, and retirement account. I have enough for the down payment and will have at least 3 months of mortgages payments by the time of closing. I know that for a typical rental this would be 

Thanks for the help and if you need anymore information I would be glad to provide.