All Forum Posts by: Daniel McDonald

This is where having an investor friendly agent is going to be key. They should be able to give you an idea of what needs to be done vs. what can wait and rough estimates/recs for contractors. You can also get a contractor to go look for you and give you a verbal estimate but not everyone will do that. Or do it for free.

Looking forward to it. Grab a free ticket here! Meetup is at Backbeat Brewery! 

https://www.eventbrite.com/e/beverly-real-estate-meetup-tick...

I’m a 2x house hacker just north of Boston and an agent. I get it. Truthfully even when I bought my first one at 3% IR I thought this is risky. The rate was good but I thought I was overpaying a ton. But like you mentioned appreciation is on your side here. That property is cash flowing now and has built a nice chunk of equity. 

I agree I would not buy anything that would cost  1000$ a month AFTER you move out. That’s telling me you need to keep searching. In that time you aggressively save and consider different options meaning co living, MTR, etc. what will make those properties work? 

hey @Ben Burgess welcome. I am just north of you in Beverly, MA. I am on my second house hack here and that's been really huge for me and my family. Have you thought about that doing that first? I know Medford prices are no joke but the appreciation in that area has been insane. I can attest to doing it with a wife and small child; it's worth it for sure. 

Quote from @Mike Levene:

Quote from @Daniel McDonald:

@Mike Levene I am a 2x house hacker in Beverly, MA, just north of Boston, and yes, the cost is brutal, but the appreciation is worth it. Cash flow is a myth. You're investing in RE for long-term wealth, not a few hundred a month that can be wiped out with one CapEx item. Boston in particular is a strong market with great appreciation, a great tenant pool, and rents being as insane as they are it's nearly impossible not to pay less when you house hack vs. rent. It's a challenging market but I say if you can pay less then you currently are renting then it's a win. That alone can free up so many avenues for you.

 Thanks for the local input, this aligns with what we are seeing. I agree, its easy to say oh I want cash flow, but ultimately, most of the gains are made with appreciation and principal paydown over long periods of time. 

We certainly have found some deals that would reduce our living expenses compared to renting. In the short term this is great, but after moving out of the property, these units would be ~ -$500/month in cash flow. I'm all for an appreciation play, but this seems like the reality of the current rates and the market in this area.

Just curious, how did you find your househacks?

 Yes, I definitely see a lot of situations that break even or go negative. I wouldn't go negative unless i was so confident I could take on that amount like maybe 50-100$ a month. Because if you think about it if it appreciates 400k over 15 years that's a long way off of eating 9k in cash flow. And that's a very simple example but you get the point. 

I didn't do anything crazy. I worked with a solid agent who understood house hacking in general. He did it himself in Quincy. Both mine were off the MLS. The biggest key was understanding that It was more important to get on base then it is to hit a home run. Especially for the first one.

@Mike Levene I am a 2x house hacker in Beverly, MA, just north of Boston, and yes, the cost is brutal, but the appreciation is worth it. Cash flow is a myth. You're investing in RE for long-term wealth, not a few hundred a month that can be wiped out with one CapEx item. Boston in particular is a strong market with great appreciation, a great tenant pool, and rents being as insane as they are it's nearly impossible not to pay less when you house hack vs. rent. It's a challenging market but I say if you can pay less then you currently are renting then it's a win. That alone can free up so many avenues for you.

Quote from @Elias Azo:

Quote from @Daniel McDonald:

Never too late to get started @Elias Azo. Everyone always wishes they got started earlier, what matters is you start. 

I am a 2x house hacker outside of Boston and it’s been the decision I’ve ever made. It’s by far the most forgiving strategy and you don’t have to hit a home run for it to change your life. ThTs my biggest piece of advice. Don’t obsesses over finding the perfect deal, just get on base.

always happy to connect and talk about my experiences. Best of luck!  

 Hey Daniel

Thanks for responding man! And that goes for everyone else who took the time to welcome me or send any positive words of encouragement. I apologize if I didn't tag you. But it really does mean more than you know. All of this can be pretty scary for a newbie, so just hearing from people who have been successful is very motivational and inspires me to keep going.

Your story sounds very similar to where I'd want to be in the not too distant future. Can I pick your brain a little? 

What's the biggest mistake you made?

What's something that happened which was unexpected or you didn't anticipate (good or bad)?

How quickly were you able to jump from House #1 to House #2?

Thanks again!

-Eli 

My biggest mistake (so far) and unexpected, cost me about 15k. I knew there was water in the basement and the inspector recommended I get someone specific to look at it. I didn’t because it was either going to be a very cheap expense or very costly but I was blinded by actually getting my offer accepted. So I ignored his advice. Sure enough had to spend a ton of money on a drain, pump, and mold removal. On top of that I went with the most expensive of the 3 quotes I got because I just assumed you get what you pay for. That wasn’t the case. They were totally unprofessional and I’m already getting mold again. I’m not sure how I would have don’t that part differently but I will say the hardest part of real estate (in my eyes) is dealing with contractors. If you find good ones hold on to them for dear life. 

Quote from @Brody Trott:

Hey Ron! I’m a firefighter up in Massachusetts and I’m looking at getting started in real estate investing too. I’m in the same boat as you are with a safety net incase something happens in our career. I worry of injuries as I have a re-occurring injury from the academy, so I want to start something to let me get out of this career early and defer the pension. How’s the investing been going for you?

I am in MA myself. Been house hacking in the north shore. Love connecting with other MA investors.

Never too late to get started @Elias Azo. Everyone always wishes they got started earlier, what matters is you start. 

I am a 2x house hacker outside of Boston and it’s been the decision I’ve ever made. It’s by far the most forgiving strategy and you don’t have to hit a home run for it to change your life. ThTs my biggest piece of advice. Don’t obsesses over finding the perfect deal, just get on base.

always happy to connect and talk about my experiences. Best of luck!  

@Osvaldo Guerra, there are too many nice places to house hack. I think you'll get stuck in analysis paralysis if you think about it like that. I would instead focus on where you ACTUALLY want to live. Because even if it's a more expensive market, you're house hacking, so you're going to be subsidizing your living expenses anyway. I am a 2x house hacker just north of Boston. I love it. It's not cheap, but it's totally worth it for me.