All Forum Posts by: Damon Bodine

hi @Jose F Castillo it sounds like whats going on here is that you're looking for an FHA loan. In a FHA loan there is a provision on 3-4 families that the building needs to pass the self sufficiency test. This is specific to the FHA loan product and one of the things that makes it challenging to get closed in 3-4 units with the current rate environment. If you were to do a 2 family with FHA the self sufficiency test is not required.

Search FHA self sufficiency test on Youtube. There are a ton of great video content there. Specifically (Justin Brown or Win The House You Love).

If you opted instead to get a conventional mortgage the self sufficiency test is not required.  However there is a higher down payment required.    

Hope this helps.  

Hey @Andrew Northcutt .   

Manhattan can be tougher because of the housing stock.  A lot of times NYC house hacking  is doing a 2-3 family purchase.  Then doing a combination of strategies (airbnb rooms, long term rent by room, and then traditional long term lease in unit 2) to maximize the buildings income potential.   Manhattan a significant portion of the inventory is condo/coop.   In a condo of course you can rent rooms but the math ends becoming less favorable with the higher taxes/common charges.   Co-Op can be difficult because of rental restrictions.  

That said i've had some success with clients in Harlem. You may not be completely zeroing out expenses on a monthly basis  but doing significantly better with rent.  Additionally amortizing loan at a pretty good clip.    

A lot of times these properties are going to be priced beyond the FHA and conventional high balance loan limits. That said often need to opt for different products (for example 80-10-10 jumbo loan etc). Also depending on what and where you buy it can be useful to look for community bank first time home buyers loan programs. They're often going to be superior to FHA in rate, lower or no monthly MI, and occasionally closing costs credits).

PM cost is going to vary significantly based on what you're buying.  10% is not unreasonable. Vacancy and maintenance I generally budget   5% but will depend on what you end up purchasing.  

Hope this helps always happy to brainstorm if ever helpful. 

 Hey @Annie Tolochinski
Thanks so much for reaching out.   So we hit capacity on this event .  So unfortunately we can't open up more tickets.  However we do this event every month.  I also host two others.   I'll connect with you and we can get you on the list for the next event now.     

Thanks so much 
Damon

What is house hacking? “House Hacking is a strategy that involves renting out portions of your primary residence to generate income that is used to offset the cost of your mortgage and other expenses associated with owning a home. When done correctly, it allows people to live in expensive areas completely for free, or even generate positive income through home ownership”-David Greene

Savvy homeowners have been using this approach for decades to offset or in some cases completely cover their living expenses.

Join us for our the March edition of House Hackers Happy Hour. Here you will meet other house hackers and industry experts who are taking advantage of this strategy to dramatically improve their savings and investing goals.

Damon Bodine Investor Friendly Real Estate Agent is your host. Damon has worked in the New York City since 2014 and is also an active investor. He has worked all over the 5 boroughs helping buyers achieve the dream of home ownership.

Date - Wednesday, March 1, 2023
Time - 6:00PM
Location - Online -RSVP on eventbrite for Zoom Link
Ticket Link -

https://www.eventbrite.com/e/n...

Cost- Free

Any questions feel free to reach out to Damon. If you think anyone could benefit from this event please feel free to share with them. Open to everyone!

Brooklyn, Queens, Manhattan, Bronx, Staten Island, and beyond.

Hi Everyone,

Hope you're doing great. Back with the second  Network=Net Worth event of 2023. This month we'll be partnering again with our friends at the Multifamily Breakfast Club and Invest Up to bring you a great networking event. We couldn't be more excited.

Location: Mchales Bar and Grill
251 W 51st St (& 8th Ave.)
New York, NY, 10019
Time: Saturday February, 11, 2023
10:00AM- 12:00PM
Cost: FREE

RSVP: Please RSVP at the link.   Please note all tickets were claimed in advance last time.  So if you do plan I encourage you to RSVP early.  

https://www.eventbrite.com/e/m...

Our meetup traditionally draws a mix of investors and real estate professionals of all experience levels. Our group is about positive encouragement and low pressure good vibes. Open to everyone Manhattan, Brooklyn, Queens, Staten Island, Bronx, New Jersey and beyond.

Please help us build this up and tell anyone you know.

Any questions please email [email protected] or text (347) 581-2058.

A few things that could be happening here.   

#1. Divorce Sales - properties in which a  married couple is deeding one portion of their share to the other who will now be the sole owner.   

#2. Partial deed sales.   Lets say someone is bringing a partner or something into the existing ownership structure. or vice versa.  

#3. If you're looking at 3rd party sites like zillow, red, trulia etc. the can be wrong a lot more than people think. Have to always follow up tax records to verify sale. Broker in the area with MLS access should know how to do this as well.

#4. Foreclosure sales .   In all serious foreclosure sales can sometimes can take multiple years to close.   Especially in a state like NY with the slower judicial process.   So you may very well see things. that were contract in 2018-2019 that are just closing now.  

#5 Recording delays/mis-recordings. - Deeds are generally recorded within a couple of the sale.  However at times things do slip through.   You'll probably see some deeds every week that were actually sales from a number of years ago but were improperly recorded. So they're doing corrections now.   

Hope this helps! 

 House Hacking for a few reasons.   
#1 As a true first time home buyer you could be eligible for community bank/CRA loan programs that are based on property census tract. These can be better than FHA for a few reasons A) Traditionally lower rate normally 0.75%-1% lower than the average FHA 30 year fixed . B) Some of these loans the lender will exclude PMI from day 1. C) Down payments can be similar to FHA on a 2 Family. . Take in you don't need to be a true first time home buyer to get an FHA loan but you almost always do to get a community bank loan.

#2. You'll get your own management experience.   There are plenty of people in NYC that work full time + but still manage to deal with the common tenant issues.  Can always hire a building super to offset some of the workload.   To me this will make you infinitely better at hiring down the road if you want to expand your portfolio.  

#3 You're hedging against rent which for most is their highest expense.  You do pay a higher portion of interest in the beginning of a 30 year fixed loan but that said you're still amortizing every month.   

#4 Often times investors write off as many rental property expenses as they can. While this is great for your tax return its not always great for qualifying for future mortgages . One of the things lenders use to approve you is debt to income ratio. If you're showing losses on yoru taxes consistently that will hurt your DTI if when you decide to buy primary.

Theres many more but i think those are some good considerations to start with.   Always happy to brainstorm with you if ever helpful.   We also host NYC house hacking happy hour every month if that was ever of interest.   

Cheers  

Hi Everyone,

House Hacking is really taking off this year in NYC.   I've been speaking and working with prospective home buyers every single day who want to take advantage of this amazing strategy.    I try to post a good amount on BP about different things to consider with your house hack.    Today I wanted to focus on 5 common questions i've been asked over the years.   Obviously this is not meant to be legal  advice and of course one should always do additional research. Just trying to provide good information that you might find useful.   

#1. If you are to take on roommates as an owner  they must maintain a 'common household'. 
This essentially means roommates must have access to the common spaces of the apartment.   This also means that you cannot install external locks on doors to separate living areas.  Heres is a good article to reference for more information.  

#2 Landlords cannot collect more than one month security deposits when renting.  
One piece of misleading advice I've seen many times is the idea that landlords can collect multiple months of a security deposit when renting to tenant.   That is not legal in NYS under almost every circumstance.    Here is an article on this .  
https://www.nysenate.gov/legis...
https://rentguidelinesboard.ci...

#3 Renting out rooms in a basement.   
This is generally not permitted.   There is a way to legalize some basements in NYC but before making making assumptions  I would read the sub section. 'basement and cellar occupancy law' here. https://nyc.gov/site/hpd/servi...

#4 Adding more kitchens 
I see this a lot in buildings around the city.  Situations in which the owners have installed extra kitchens, put up pressurized walls etc to add more rentable space in house.  Most of the time this was not done legally.     Here are some articles that are hopefully valuable on illegal conversion and non conforming bedrooms.  

https://www.brickunderground.c...
https://www.nyc.gov/site/build...

#5.  What is a legal Bedroom 
This is a very common thing in NYC.  The general definition is that a legal bedroom is a  minimum of 80 square feet total and no less than 8 feet in any dimension.  There are some carve outs for units with more than 3 bedrooms.  Fontana has a great article on this.  
https://fontanarchitecture.com...

Hope you find these helpful.  Will do more soon.  

hey @Joseph Villanueva. it depends on your long term goals.  If you're looking to simply stabilize your housing cost than a co-op could be a good idea.  Take in mind most co-op's do require 20%+ down , have subleasing restrictions, and higher maintenance.   

Condo to the above poster also occasionally have renting restrictions although thats not always the case.   Condos can be attractive to a first time home buyer because you can usually get to them with a much lower down payment.  

Single Family -There won't be as much inventory as most of our housing stock is 2+ units.  That said in a 2 family scenario its a great opportunity to earn rental income day.   

A lot of your strategy should be based on your longer term goals, budget, down payment, and location preferences. An often overlooked part of the NYC housing market are community bank loans which are designed for first time home buyers. They can offer lower rates, closing cost credits, sometimes will eliminate the need for PMI etc.

I'm happy to brainstorm with you if helpful.  If we could go a little deeper on your unique situation than you can build your buying strategy from there.  NYC housing market is complex but very doable.   

What is house hacking? “House Hacking is a strategy that involves renting out portions of your primary residence to generate income that is used to offset the cost of your mortgage and other expenses associated with owning a home. When done correctly, it allows people to live in expensive areas completely for free, or even generate positive income through home ownership”-David Greene

Savvy homeowners have been using this approach for decades to offset or in some cases completely cover their living expenses.

Join us for our the February edition of  House Hackers Happy Hour. Here you will meet other house hackers and industry experts who are taking advantage of this strategy to dramatically improve their savings and investing goals.

Damon Bodine Investor Friendly Real Estate Agent is your host. Damon has worked in the New York City since 2014 and is also an active investor. He has worked all over the 5 boroughs helping buyers achieve the dream of home ownership.

Date - Wednesday, February 1, 2023
Time - 6:00PM
Location - Online -RSVP on eventbrite for Zoom Link
Ticket Link -

https://www.eventbrite.com/e/n...

Any questions feel free to reach out to Damon. If you think anyone could benefit from this event please feel free to share with them. Open to everyone!

Brooklyn, Queens, Manhattan, Bronx, Staten Island, and beyond.