All Forum Posts by: Irene Low

Have you tried a Triplex or 4-Plex? 

I found this one that might cashflow. 

https://www.redfin.com/TX/Killeen/3405-Victoria-Cir-76543/ho...

Usually if you can't make a duplex work, you can make a triplex or 4plex work. 

When your searching for property, use the county so you get some of the suburbs included in the search. I prefer Redfin as its the most professional grade property search from my experience as a Landlord Real Estate Agent.

Have you considered investing out of state? Here in Columbus, Ohio we come by deals everyday that cash flow for the start. It sounds like you're not finding the right deals. Ideally, you'd find pocket listings or off-market deals to ensure that you're getting a good deal off the bat. Many of these deals meet or beat the 1% rule. They also offer the opportunity to utilize the BRRR strategy to maximize gains.

This is a difficult question to answer because it's so specific to your goals and risk tolerance. Generally, I'm not a fan of buying a deal that a) doesn't make sense today and b) doesn't have a viable exit strategy. However, you have a variable that makes it less cut and dried, which is that you're purchasing it to fulfill your own housing needs. Presumably you need to live somewhere. You don't necessarily have to cash flow if you're receiving the benefit of free or a significant offset to your housing costs along with all the other benefits of owning real estate (tax deductions, mortgage paydown, etc.) It's very difficult to make anything cash flow putting so little down. If you have the $ you could consider putting more down, but most first time buyers don't have that option. If you're ok coming out of pocket X amount each month (you determine what that is), if you feel like you're going to own an asset that will appreciate enough during your holding period or you're willing to hold it for the long term, and if you want to get started in real estate with a relatively low risk strategy (house hacking) then I'd say go for it. But only you can fill in those numbers for yourself. One thing to keep in mind is that TX is one of the states with significant property tax increases pretty regularly. You can talk to someone in the Tax Collector or Assessor's office to find out what's in store for 2024, but you'll want to factor a certain % increase in your PITI each year given the tax environment there. If not, you could find yourself even more under water if rent increases don't keep up with insurance and property tax increases. Good luck to you!

Make an apt with an accountant.  You need to know how the purchase will affect your personal taxes and deductions.  Create a budget, now, before you buy.  What would living with that budget be like?  Miserable?  Easy?  If / when you do get something, I encourage you to get a second job, sell stuff, what ever to create a minimum buffer of a one month mortgage payment in cash.  Good Luck.

where are you looking? You might have to give up your own back yard and invest where it makes sense. 

 Check this website out to get a sense of appreciation: https://map.reventure.app/dashboard

Are you saying that you will break even if you live in one unit and rent the other. That sounds like a pretty good deal.

@Irene Low - If you are renting now, you will have equity accumulation by owning even if values stay the same and don't increase.  You always have the option of refinancing if and when rates go down.  If you are looking to build a portfolio and the property cashflows when fully rented you have a chance of holding and moving to another down the road.

@Irene Low 

Congrats on beginning your journey in real estate, and no better way than with a house hack of a multi family property!

With elevated home prices, and interest rates positive cash flow is hard to come by BUT not impossible. 

Let me paint a picture of what i did for my own property. We utilized a conventional loan at 5% down to avoid the FHA self sufficiency test, purchased a 4 unit property. We opted to negotiate a max seller concession and big over asking price to the seller the same amount. We used those funds to complete a 2-1 temporary buydown. In year one our interest rate is under 5%.. which allowed us to actually cash flow quite a bit on the property! Now, the rate will go up after years 1, and 2.. but by then what you bank on is that rates will be in a better position, you refi, permanently reduce the rate, you have principal paydown by your tenants, and with average appreciation conservatively at 4% annually, it always makes sense to purchase a property if the payment makes sense for you, and you can afford to do so..

Once rates drop, there will be much greater demand and therefore greater competition which will inevitably drive prices higher. Imagine missing out on that appreciation... People who owned during the pandemic saw their equity fly through the roof. We're gearing up to see more of the same! If you have any questions or would like to connect further, feel free to shoot me a message! Best of luck and go get em!

Hi Irene! Your Realtor should be able to pull historical averages for the specific areas that you are interested in. The data is available through MLS listings looking at historical closed transactions. You can always snoop around on some of the well known real estate websites to look at historical data on each property you're interested in as well.