All Forum Posts by: Drew C Grossman

Hi @James Shuster

With a 20% down payment you are looking at a purchase price of $300k. It’s with noting in this rate environment you will get better terms by putting more down. With a 25% down payment you are looking $240k purchase price. It’s not impossible to get a 15% down as I’ve done it in the past but it’s increasingly harder to do. 

As @Shawn McCormick correctly identified… small mutli family in Orlando at the price point of $240k-$300k is non existent …let alone new construction anywhere within 45min of Orlando. Any decent resale duplex is going to start closer to $500k in Orlando …higher for NC

Finding a quality single family resale home in this price range and also in a good area is going to be extremely challenging. If you are dead set on Orlando, then you may want to look into a townhome or condo that will pay for itself and cash flow (depending on area)….or if you want single family you will likely need to increase your budget to find something worth investing in.

You will have a handful of solid options within 30 min of Disney if you go with a condo /townhome and your goal is to stay around $300k

Like mentioned above, parts of Haines City and Davenport are the places you will find new construction under $300k and depending on your expectations these could be decent. A better alternative in my opinion with more cash flow and upside for the same price point would be to look into Ocala. The new construction in Haines city /Davenport is about 1hr from downtown Orlando and Ocala is about 1:15hr so they are comparable but I am not as bullish on Haines City and Davenport for many reasons. I Don’t see as much money / jobs flowing to those areas as it’s more sprawl from Orlando outward which brings the lower income individuals/ lower rents further from the center of Orlando. 

Another area to check out would be palm coast however it still may be a stretch for your budget and I know your goal is to be closer to Disney. I saw there was some new construction duplex deals selling there in high $400’s. Ocala has some new construction Duplexes in the high 300’s. 

Hi @Vincent Lattuca - I grew up in the Jacksonville area and it’s unique because it covers over 800 square miles making it the largest city land mass wise in the county!

There are an handful of counties and individual  sub mark that make up Jacksonville and with that being said… price points, rents, returns, appreciation will differ tremendously from location to location. 

For example, you can get a 2,000 sqft new construction duplex in 32205 (Duval County) for $400k that rents for $1350 a side. Let’s assume you bought it at 400k and put 10% down…your mortgage would roughly be $2,850 with a 7% interest rate…renting out one side at $1,350 would leave you with paying $1500 a month and coming out of pocket 40k for a down payment vs if you just rented and saved the money!!! For these reasons, this is NOT a good house hack. The only play in this case would be banking on appreciation which is super risky and I personally wouldn’t want to invest in this area 32205 rather look towards the beaches or St John’s County. 

St John’s County is a MUCH better market overall … and with that comes much higher prices….the same product here in this county will cost double …however I don’t have any examples because there isn’t that many small multiple family 2-4 units that exist. Mostly single family on the residential side. 

What attracted you to Jax and what areas have you researched? 

In the ideal world…what are you trying to get out of this house hack?

What are the financial goals associated with this project?

House hacking a small single family or townhome and renting out by the room may be more feasible but I am not sure your comfort level / expectations / quality of living !

I just read another post who said “The more profitable the house hack, the more uncomfortable the living situation”. 

Thanks @Tanner Pile, this is super insightful to expectations in the Colorado market!

I agree with “more profitable your house hack the more uncomfortable the living situation”. My original plan when I started investing was to house hack a property in Orlando to young professionals /grad students but I switched gears and bought long term rentals instead when I moved to North Florida. It’s still a goal of mine to house hack as I don’t own my primary …but I’ve found it to be difficult to find something that works numbers wise AND and area you want to live in! The goal for me in the house hack is to pay less than I would have somewhere else with the same quality of living and then having long term appreciation…with immediate cash flow potential year 2-3 when I move out. 

@Griffin Pratt the furnished rental approach or rent by the room (short or long term) may also be a good strategy for a house hack in St Pete like Tanner mentioned above. 

Earlier this year closed on a 3/2 new construction single family home for $138,900 with a 25% down payment of $34,725 and $2,200 in closing costs at 3.25% interest rate. The price was locked in since early 2021 with builder. 

The property is currently rented at $1,650 And has a mortgage of $575 a month. 

It provides $1000+ a month in cash flow and 35%+ annual cash on cash not including depreciation or principal pay dow

Today they are selling $220,000+

@Theresa Harris - Good point....you can also deduct the window expense from her security deposit upon move out. I would just make sure you are in compliance in your state with notice to tenants on returning security deposit ect...

One scenario I could see being in the gray area is if the house was broken in to causing the window damage……the lease you have would really determine the outcome of who pays for it to be fixed…although it doesn’t sound like this is the case. 

@Vanessa S. - Yes! You aren’t misleading them because you self manage your properties and it changes the dynamic of the relationship for the  better. 

I noticed that tenants treat you way different and hold you to a different standard if in their mind you are the property manager  ….who has other properties to deal with vs a “landlord” who only have one to deal with.  

If I ever have a tenant that explicitly asks if I am the owner, I tell them I have interest in the property and my role and relationship with them is as a property manager and it’s simple as that.

Regarding proving causation to the window…I would aim to figure out what happened on a  phone call and then recap the conversation over email so there is no room for miss interpretation. This should not take more than 5 minutes, at the end of the day, the window broke and something happened. If she didn’t cause it herself and denies it …she should know what happened. Did a guest accidentally break it? Did some ones kid throw a baseball? Regardless, outside of an Act of God event, she is responsible as the tenant to what happened to the window and if she says she doesn’t know…it’s on her. If someone else caused the damage, she can coordinate having that person pay for the damage ect… 

Hi @Vanessa S. - sorry to hear about your window problem! I would approach the tenant extremely professionally and be upfront with them about the situation and give them a chance to explain what happened. How long ago did this occur? Since they didn’t tell you immediately (red flag) My advice would be to call them on the phone first and then to relay that information back from your conversation via email for written documentation. Leave the emotions out of it and follow the lease…in my lease the tenant or tenants guest would be responsible for replacing the broken window within 30 days if they were the cause. 

Side note: Does your tenant treat you as a landlord or do they treat you as a property manager? I have found that tenants will treat you very differently if they assume you are the owner! Even for the properties I own, I represent myself as the property manager and it has been noticeable different in a positive way…it takes a lot of the back and forth, emotions and personalities out of the equation.

Have a happy new year and good luck with the new tenants when you turn over the property. 

@Matthew Hollister awesome to hear!

Knowledge certainly plays a role but it’s not always the deciding factor in success….doing the simple things day in and day out is what creates results..sticking to a plan 

Thanks for sharing 

@Corey Stibbe - this is awesome! 

Where in the country are you finding a 60k duplex that rents for $1,600?! The cash flow is great..are you sacrificing appreciation upside or did you just buy so much under market value? 

What is the the property constructed of..? block..wood..is this a modular home? What type of things came up in inspection? How old is the property ect..? What is the plan to manage maintenance. 

Is this in an area with no growth or what does the area look like?