All Forum Posts by: Dev Paul

Thanks everyone. Really appreciate your input.

@Erin Estes Thanks. Ideally im looking for a peaceful and safe neighborhood. Not very far from daily essentials and places to enjoy life. I grew up in the mountains, so have a special affinity for that. Any place/town near the Shenandoah valley you wanna recommend?

@Brett Walker I liked your suggestions, thanks. Bealton looks like a very small town, but might be just right for what Im looking for.

Any thoughts?

Greetings everyone! Im looking to move close to Loudon county (Virginia) where my brother lives. I dont want to be more than 1-1.5 hrs away from him, but dont want to buy in and around his expensive area either. My budget is max 350k for a single family or a townhouse. Idea is to put 20-30% downpayment, so that the total mortgage including taxes is around 1500-1600 dollars.

Which towns/areas will you guys recommend? Schools dont matter, but want to live in a decent neighborhood. Charlottsville, Richmond etc are in my radar but looking for more suggestions!

Thanks in advance!

Hope everyone is looking forward to the long independence day weekend! While discussing my options on another thread, i was introduced to the idea of some non-traditional lending which i had no idea about earlier. To give a context- im primarily interested in a beach front condo in destin, PCB, Miramar beach area. Since i already have an existing mortgage on my primary home which kind of maxes my mortgage based on my income, i was hoping to buy investment property with 20% downpayment. But my traditional lender told me that with some new rules coming in effect early this year, they wont be able to finance condotels or in other words most investment condo properties in this area. Some of the nicer folks here put me in touch with non-traditional lending options where rate of interest is 4.5 - 5.5% compared to in early 3's if i go with traditional loan mortgage. 

So my question to all you wise folks here is, is it worth it to pay much higher rate of interest or its better to invest my money in townhomes or SFH where i can still get traditional mortgage? Ofcourse in the latter case, i have to most likely start looking at other locations as my sub 500 budget wont give me much options in terms of non condo- homes in the destin/pcb area.

Thanks @Matt "Roar" Gardner and @Amanda Ferguson. So you guys are saying it is possible to get an non-traditional loan with someone in my situation? (Income pretty much used to pay monthly mortgage on primary home). I will reach out to you guys seperately.

@Donna Hampton thanks. Please DM and we can chat privately. 

Thanks @Amanda Ferguson. 

I have found out that the new rules which came in effect early this year, makes it impossible to get traditional funding for most condos in the areas Im looking at. I was counting on traditional investment property loan through Loan depot which financed my primary home. My officer had told me that as long as i can put 20% downpayment, have 6 months of mortgage payment cash reserves, i can get mortgage where the rental potential of the property matches my monthly payments. But loandepot wont finance ever present condotels in florida panhandle which are mostly unwarrantable in their books.

My one option is getting non-traditional loan from local lenders in Florida. I spoke with one and it seems there rules are different as they will mostly count my income to give me the loan rather than rental potential as with traditional loans. The issue there is that my income is mostly used for my current mortgage and i wont have much capacity left to finance another mortgage with my current income. Unless i rent out my primary home and move to rental place with significantly less rent than my mortgage payment (something which i was going to do anyways, but wont do just for this reason)

Another option is stick with only townhomes and SFH as nothing has changed there. Im more inclined toward this option. Only issue is it will make it impossible to get anything nice near the beach in the areas im looking at- Destin, PCB, Miramar beach, 30A etc. So perhaps time to look at another places/states where i can get a place for short term rental near the beach with my 550k and less budget?

Any thoughts? I wonder how are most investors financing their condos with these new rules?

Thanks Villy, Matt, Blake and others for chipping in. 

@Mark H. Porter I agree. 
Its confusing most of the times what ROI means for different people. When I say ROI, i mean total net cash flow minus all the expenses (HOA, mortgage, taxes and other expenses in running the property). I know some people dont subtract the principal part of the mortgage in expenses calculation. Also, many a times ROI is calculated assuming all is paid in cash.

Thanks everyone for your responses. 

@Luke Carl Understood. Will check more on this.

@Dan Johnson Thanks. Yes, but in terms of appreciation, it is no where compared to Destin/PCB. 

@Zachary Beach 
"that return seem's super low for STR's for me. I wouldn't run a STR for that return if it was totally or mostly passive sure but STR's are a business and that work stress and return ratio is pretty bad in my opinion. There are better markets out there in my opinion."

 Which markets you feel are better than that? Apart from good return, i feel that having minimal airbnb restrictions and history of airbnb is important as well-which these markets have.

@Kevin Gunn . Thanks. Will surely get in touch with you.

@Matt "Roar" Gardner  Nice to hear from you. I agree with you, but considering i have zero experience in managing airbnb earlier and the fact i will be remote managing, i feel prudent thing to do will be to have some hybrid management model-not a full management company which you rightly said changes the equation significantly. Do you feel there are enough cleaners and maintenance workers in these areas to have a robust management system to do it all on your own? What about certain hybrid management companies which take only 10% of the revenue and you do some work yourself? No, I havent been to gulf coast before, but planning a trip before i buy. For my first property, i would rather stick to tried and tested areas- whether PCB or Destin or nearby beach towns.

@James Byrd Thanks for confirming. Yes, the annual calculation makes sense. I was looking at July rates and they were phenomenal in these areas, but not much less in Myrtle beach too.

@Blake Hernandez Oh I didnt know that LTR market is good as well there. What kind of ROI can one expect in LTR there? Stress of managing a LTR is surely less, but then extra cash flow and experience earned in STR's can go a long way too.

Also, what is the issue with non- warrantable thing? Arent most in that area non- warrantable anyways?