All Forum Posts by: Brandon Dumbuya

@Montez B. I self manage. That’s the best way to learn management. It’s also like PM with training wheels since you live there already. 

Hey @Bill Hampton is that recommendation still available? I have a property in Decatur and I'm looking for referrals.

@Robert Ciaramello

You’ll want to spend some time researching the different strategies. I agree with Nicole that house hacking is a great place to start. The risk is relatively low because, if you’re already spending a good amount of money on rent, a mortgage would be reasonable in the worst case of long term vacancy. You’ll also build confidence and experience managing a property.

That being said, make sure that you’re well-educated before purchasing anything and set long term goals. The biggest hurdles to getting your first investment are typically capital and knowledge. I’d recommend spending the next few months building both(if needed) and you’ll have a better idea of which type of investment you should make.

Even if you start with a househack, having knowledge of where you want to go, will help you make decisions now. For example, my first house hack had a value add component so I’d be able to build that skill. You can do the same and make sure your first investment will accelerate your long term goals.

Feel free to reach out if you have any questions.

Hey Brayden. Great job getting started at such a young age. By getting in here and asking questions, you're on the right track. For a solid resource on house hacking, I'd recommend reading Craig Curelop's book on the subject. Brandon Turner's book on landlording will also be a valuable resource if you will be self-managing (I'd recommend self-managing since you'll be living there already). Feel free to reach out if you have specific questions.

@Montez B. I'd recommend the east metro area (Decatur and some parts of Stone Mountain where development is moving) and the upper westside

Hey Patrick,

There's an unavoidable tradeoff between initial equity and NWROI. If you use a low down payment, your initial equity will be low (as low as 3.5% with FHA) and it wouldn't be feasible to get that up to 20% after the first year if you have a 30 year mortgage. The lion's share of your payments will go to interest, barely affecting equity.

If you put more down, your equity would be higher, but the increased cash invested would adversely affect NWROI. 

If you're really set on being able to refinance in a year, you'll need to either buy equity (buying at a deep discount compared to retail) or build equity (do a value-add project to force appreciation). Otherwise you just need to put 20% down because you won't be able to create that after year 1. 

There are also other low down payment loans you can take advantage of that don't have a owner-occupancy requirement if that was your concern. Look into Fannie Mae Homestyle.

@Anthony Dooley is right in that finding a duplex may be difficult depending on your market. I'd add single family houses with a guest house or mother-in-law suite to your search. If you're having a tough time locating one that meets your criteria, consider renting a SFH with 4 or more rooms and renting out the rooms individually.

Also, learn how to manage a rental. I'd recommend Brandon Turner's book on landlording to give you a good idea of what you're getting yourself into.

House hacking a good idea but make sure you're educate on how to be successful. Craig Curelop has a great book on house hacking and Brandon Turner wrote a great book on being landlord. I'd recommend reading at least one of these to know what you're getting yourself into. Those books along with the BP forums will give you a good idea of potential headaches. Most importantly, make sure you know how to analyze a potential deal and screen tenants. 

You can get a PM if you want but most people recommend self-managing your first couple of properties, especially if you'll already be living there. Your PM doesn't have to tell the renters you own the property. That's up to you.

I agree with @James Bradin that house hacking is a great way to start. Like he said, you can take advantage of low down payment loans so saving up for your first property may not take as long as you'd think. You'll also learn a lot about managing a property with lower risk. Check out the book on house hacking by Craig Curelop.

Also, nothing against wholesaling, but people often make it seem a lot easier than it actually is. Like any other real estate strategy, you need to know what you're doing. That's not meant to discourage you, just a heads up that it's not a cake walk.

@George Barboza

I agree with @Jaysen Medhurst in using a conventional low down payment loan over FHA for the reasons he mentioned and no requirement to occupy the property. To take it a step further, you can include the renovation in the loan amount and increase the value. That gives you hands-on experience performing a value add. Just don't bite off more than you can chew with the rehab. Fannie Mae HomeStyle may be a financing option for you if you go that route.