All Forum Posts by: Greg Pasquale

Thank you for your detailed reply.  And for quality info.  I suppose the first thing I need to do is build a team once I find some areas that interest me.  I prefer to be as hands off as possible.

About a year and a half ago (with much less knowledge than I have now) I made an impulse buy and purchased a 3b condo out of state.  It wasn't even built yet. I got lucky.  It was right before material costs exploded and home prices in the area also increased.  I also found a fairly priced PM and had it rented immediately.  Granted it is only a condo, I am getting good cash flow for a first property and being clueless.

Fast forward to now.  More info.  More opinions from people.  Paralysis by analysis.  I suppose I could keep getting these type of properties but it can turn into a grind and eventually I will not get the finance I need.  Basically run out of cash.  Unless their are lending gymnastics lenders can do I don't know about.  

Would going for a 4 unit make more sense?  A multi family?  Does the condo give me any leverage?  Would it make sense to sell it this quickly?  I'm waiting to speak with my PM to see if they have experience with multi-units?

I guess what I am asking is, I want to get my money into assets by long distance investing (I live in an area where housing prices are insane as is the competition). Should I take is slower? a duplex? a SFH? another condo? 4 unit? (This is assuming I did my due diligence on the area and get the financing).

Thanks in advance.

Full disclosure: I am weighing and researching two different investing strategies at the moment.  This is one of them.

I am looking for a short term rental investment in Florida within the next 4 to 5 years I'd like to live in.  Doesn't have to be by the water but great if it is.  Also not in a retirement heavy area.

I have disposable income at the moment I do not want to go to waste.

I am still in the fact finding stage but if the numbers work - it is something I seriously will consider.  Again, the caveat is, eventually it will be a property I would live in so not exactly looking for a tourist area.

Thanks

I'll give an example of what I am thinking of doing and if this is a viable strategy.

Full disclosure I am relatively new and learning and taking my lumps as I take action as well as I speak with more and more people.

I've mentioned this in a few other posts, but I am sort of stuck on Long Island for another 4 years or so.  Then I am certainly moving out of state.  I pay outlandish rent, like $3k a month. I want to at least cut this in half.  By the fall I will have disposable income. Probably about 90k worth.  In lieu of house hacking, or any other strategy is the below doable?

I have an acquaintance who bought a home in Florida (by the water) and sort of AirBnb's it throughout the year blocking off times she wants to live there while still "living" in NY until she can permanently move.  According to her...by renting in a desired area for weeks at a time she is able to cover all her expenses in only a few months and allows her to support lots of her living expenses in her current property in NY.

I am well aware, that there are variables such as how much she bought the new property for, how much she put down, how much rent is she getting, where she currently lives now, etc.  But is this a strategy of sorts?  Is it sort of a buy and hold with the intention of living there at some point while covering all costs of the property and then some.(And no, it doesn't have to be Florida, I am still weighing my options on where).

Anyone do something like this?  Or have clients or associates who have done this?

@Jason Aro - I am in the same boat as you.  Live on Long Island and looking to house hack here for about 4 more years as well as invest in other areas.  Currently in search of a savvy, investor friendly, creative real estate agent in the area who is seasoned investing and house hacking on Long Island.

If I come across anything that I think could help you, I'll pass it along.

@Craig Curelop

Thanks for the reply.  Yes. I am a very new investor.  I am actually about 3/4 through your book and will probably finish it later.  Between your book and Brandon Turner's "rent" book and "no money down" book...total paradigm shift for me when it comes to RE investing.  Was always intimidated by it.  Stocks, gold, bitcoin, day trading, side hustles - been doing these for years and rather successfully - never once wanted to touch RE.  But this year I am looking at, on the low end 70K (after tax) from my side gig and 100K+ if things continue the way they have since the start of this year. (I try not to include anything from my W-2 career in any of this)  The problem has been "wasting" my side gig cash on $3000/mo rent.  Need the space for my two teenagers.  Hence, the reason I am tied to my expensive area for another 4 years or so.  I just can't see another 12 months of paying 36K in rent.  So being I am in an expensive area for both homes and rent...my best case right now is to house-hack and cut my monthly payment down to let's say $1000/mo.  That would make my reserve cash (ie side gig cash) go farther. For instance - if I get to $1000/mo - to cover that, I use only $1000 of my side gig reserve cash instead of $3K of it. More for emergencies and investing.

I have been analyzing using your NWROI formula (with very conservative and worse case numbers) and I am still coming out ahead with 60% NWROI's in these expensive areas (side gig reserve cash to cover the offset).  I'll take it.  (Assuming I am doing this right)

Renting bedrooms will not work for me however.  I suppose I could buy a 5 bedroom 1 family and make a 2 bedroom apt out of it.  But now I am getting into 1. spending lots of money to convert and 2. getting into a gray area in this town zoning wise.  Although I know there are "2" families in my town - I highly doubt they are legal (I've yet to get a straight answer out of residents or the town) or there are probably variances for "family" members.  So, for a noob - this would be tough for me.  Unless I am missing something here as well.  I plan on reaching out more to the town on this.  And also find a local RE agent I like and explain my situation.  There is pretty much NEVER "multifamily" homes listed in my town.

Other option is to try B to B- neighborhoods - where 2 family homes are a little more common and work the process there for 2 to 4 years.  No matter how bad the market gets - living on Long Island - I should be able to squeeze out some appreciation over 2 to 4 years.  Lots of moving pieces. But I am thankful I can even entertain this situation.

@Matthew Cassella

Thanks.  All you listed are things I am considering.  I have a novice question though and I can't seem to find a straight answer, since there probably isn't one.

If I bought a SFR and converted to a 2 family - permits needed? Is it always "illegal". Even my neighbors who rent either won't say (probably illegal on the books) or "don't know" since this is how they bought the house.

And is that even allowed in certain zones. For instance in certain towns in LI, AAA, AA, A, B zones always say SFR only. But do they just mean the type of structure? I can't see not being able to purchase a SFR that is legally a 2 family - if that makes sense.

Also, let's say all the work that needs to be done is inside the home to make it a 2 family and I still wanted to legally make it a 2 family, what is the cost (of the permitting process, not the construction), is it a hassle?

When I search purely residential areas on LI for "multi-family" - there is never if any multifamilies available.  Is that demand or because they are technically "not allowed"?

I know, lots of rookie-ish questions.

@Ben Kappel Thanks for that link.  While I can't necessarily move for the next few years, my plan is to move west when the time comes.  With that said, North Dakota is not out of the question for remote rentals as I have been researching ND and Wyoming.  Would need boots on the ground and some networking before I can go that route.  It is still on the table.

@Brady Grohne Yes - this is something I didn't even think of and the towns I am looking at are walking distance to the Fire Island Ferry which attracts lots of STR.

@Pedro Jean That's the goal in a few years.  For now I am going to have to cobble together other solutions, which apparently isn't as daunting as I first thought.

@Noah Gregory This is the conclusion I came up with this morning as I ran more numbers. I will have enough disposable income to grab an FHA (if they will still exist after this pandemic), force some appreciation on the home, maybe live and flip in 2 years, cut my monthly payments 2/3s while in the home (would be a realistic goal), maybe even break even if I get creative, still have enough to cover that other 1/3, AND start remote investing. Lots of moving pieces.

Thanks All - it's answers like these I was looking for.  So many options and angles I didn't see at first.  Now my mind is spinning again.  I appreciate everyone taking the time to reply.

@Shae Green

Yes. If I can find something that trims 2K off my current rent, I may consider it.  Currently paying 3K (its almost embarrassing to tell people who don't live in the tri-state area, lol).

And will definitely check out that  House Hacking book.  I just finished Brandon Turner's Rental property one and No Money down one back to back.

Yes. I have STR by me. Fire Island and the Hamptons. Lol. Student housing is also off the charts.