All Forum Posts by: Eric Dietrich

Distribution from the 401k would be about $15k.  So, I would assume tax implications would be minimal.

I am considering using my 401k available loan to purchase a smf that will be used as my family's primary residence.  As I am about to change employers, I am strongly thinking about taking out the loan and then not paying it back so it is treated as income as I have tax losses from the BRRRR of our current duplex. The other option I have is to use a bunch of the cash we have sitting in our bank account from the refinance. I'd prefer to stay as liquid as possible in today's market.

Thoughts?

My wife and I are working towards moving across the country to be closer to family. We BRRRR'd a duplex and seen crazy appreciation in the last two years since we purchased. We refinanced, however, due to the crazy politics of where we live, the idea of long-term cross-country ownership seems foolhardy. As we have some reserves and where we are moving to, we could potentially buy multiple properties with said reserves, even before doing a 1031 or 121, what do you believe is better of the following scenarios:

1) Wait for a remote or local job in the area and then buy a small-multi as owner occupied, then sell our current duplex and 1031 that with all of the proceeds into more small multi-family units?

or

2) Buy a non-owner occupied now, once I have a remote/local job there, purchase the small multi-owner-occupied with a 3.5% down FHA and then sell the duplex where I currently live and 1031 that into more units.

Or...what is another way of thinking/planning that comes to mind?  In all of this we do not want to keep our current duplex as the homeless industrial complex is aggressively trying to eliminate small property owners where we currently live and I want out before our local market is destroyed.


 

My wife and I recently did a 203k to purchase a duplex in the Seattle, WA area and it was a fantastic learning experience and amazing ROI.

We purchased a duplex for 300,000 with a 203k loan of 335,000, then because it was a learning experience, another 20-30k out of pocket...a lot of that due to supply chain issues.  Rents were 900/mo for 700 sqft 2 bed / 1 bath units.  We are doing owner-occupied as that is a requirement for at least 1 year with these loans (unless other extenuating circumstances come up that you can document). We have come out the other side with a refinance value of 525k, which we did a cash-out refinance on. Also, rents went to 1350 for the first year (self-managed) and the second lease we have shifted to a PM and getting serious interest in the vacant unit at $1695/month.

A few things I would say to watch out for are:

1. Get multiple contractor bids.  Our bids ranged from 30k-50k for the things included in mortgage.
2. Use your FHA inspector for everything - we made the mistake of not communicating enough as he is the one that can really crack the whip on the contractors.
3. You typically have 6 months from when the loan closes until the construction is supposed to be all buttoned up.
4. Try to get as much of the construction complete before you even consider moving in.  We didn't get enough done and had to live in the construction of two units with a 2 year old.

We ended doing the following:

• Roof 
• Electrical
• Windows
• Repipe of supply lines
• Crawl space clean-out
• All new landscaping, fencing and a retaining wall
• Paint inside and out
• Gutted bathrooms and kitchens

Personally, I would love to keep using this method when my wife and I move to the Philly area in a few months as being able to include all those expenses into the loan over 30 years was less expensive than if we did the project piecemeal due to inflation.  I would just do a lot more of the project schedule management myself to make sure my life isn't chaos.

@Dan Powers and  @Jesse L. Weaver

Thanks for the confirmation of what I was thinking/seeing off of Redfin and Zillow.  I've also been wondering about Coatesville.  It's far enough from in-laws to be have the space, but close enough to still get all the help we need.  I really like the numbers.  

However, having driven through there a couple times, it seems pretty rough.  In the Puget Sound area, I would call that a "D" community for the downtown area.  Is that a legitimate assessment overall? Or is it just the downtown area like that?  

It is your money and your time.  He's already been stringing you along, he'll keep doing it.  If you can, cut the dead weight.  The question that it would come down to for me is, "Are his missed promises worth my money and anxiety?"

Pottstown PA is the primary area we are looking at right now.

I am looking at buying property outside the state I currently live in.  Specifically, I am wanting to do two purchases, depending on funds.  At least one multi-family, but optimally two multi-family units (the second being owner occupied in about 6 months).  We currently have an owner-occupied duplex.

For those that have purchased out of state, what recommendations do you have?  

Me and my family are planning to move to the area. to be near my wife's family, in the next 6-ish months, from the Seattle area, where we own a duplex.  Our goal is to purchase a multifamily non-owner occupied in the next 1-3 months then a multifamily owner-occupied that will be turned into an investment in a year or two.  

Our first duplex was a 90% rehab (only the sheet rock and drainage/sewer pipes weren't replaced).  So, we aren't afraid to get our hands dirty.  But not as dirty this time.

Any recommendations, wisdom, guidance, recommendations for an out of stater?

My wife and I purchased a duplex in Washington State at the beginning of the Covid lockdowns in 2020.  Knowing that we purchased fixer upper (basically a full gut job) done on a 203k loan, which is now complete.  However, there are some outstanding repairs that I am unsure if the *need* to be made or not and would love some wisdom from the community.  The biggest remaining items pertain to the crawl space and the parking situation.

Here is an itemized list of repairs:

1. Big roots cracking our asphalt driveway directly in the way of people walking into the units
2. Crawl space vents broken/missing
3. Crawl space vapor barrier
4. Mold on support post(s) in crawl space
5. Insulation hanging down in crawl space
6. Rodents in crawl space (hire a professional or crawl the tiny space and bait stations?)

If you were us and this was your first rental unit (owner occupied), would you do the repairs yourself or not?  And why or why not?

Thanks