All Forum Posts by: Jordan Spaans

Zachary,

You do awesome work at Premiere! I think house hacking is an awesome way to go. You can now get a conventional loan for a 2-4 unit and put as little as 5% down if you live there. I did it with a 4 unit several years ago using an FHA loan. I put 3.5% down and lived there for a year, then I moved out and now all 4 units are rented out. You also can get a better interest rate using 30 year owner occupied conventional than most investment loans.

Andre, normally I would say getting and FHA loan (3.5% down) and buying a multifamily to owner occupy would be a great option. You could live there for a year and then buy your forever home. In your case, I am not sure your wife would go for it. However, I would say that just because you purchase a home to live in does not mean the banks wouldn't lend to you for an investment property. They most likely will still allow you to get a loan on rental property.

Jonathan, Long Beach is an expensive market so you are probably correct with your calculations. However, while it may not cashflow now, in the long run this property may be a great investment since rents will likely rise faster than most markets and it is likely that this area will have much more appreciation than many other areas. Cashflow is great to have, but Long Beach may be more of an appreciation play, which is great as well if that aligns with your investment objectives. 

 Bryce, sounds like a neat deal! If you can refinance the loan the balloon payment can be avoided. 

Antonio, you can househack by purchasing up to a 4 unit property with an FHA loan for as little as 3.5% down. You are also able to add some of the projected rental income (70% I believe) towards your income to help you qualify for a higher loan. You would be required to live in one of the units for at least a year. Typically, an FHA loan will also have a better interest rate as well since it is owner occupied.

Lucas, buying a multifamily is a great way to go. You are probably eligible for a VA loan, or definitely an FHA loan. This would allow you to put a a low amount of money down and have a lower interest rate since you are owner occupying, you will be required to live at the property for a year. I was able to purchase a 4 unit a few years back with 3.5% down using an FHA loan, I lived there for a year and now have moved out and rent out all four units. Househacking is one of the best ways to go with a lower down payment so you are thinking along the right lines!

Ahmed, those are some great numbers, nice work! Any reason in particular you didn’t want to refi instead of sell? 

Zac, Grand Rapids/West Michigan is a great area! I currently own a few rentals in West Michigan. My opinion is one of the best ways to get into real estate is househacking. I was able to use househacking to purchase a 4 unit in Rockford, MI with 3.5% down (FHA loan) and I lived in it for a year. I now have moved out and rent out all 4 units. It was a great way for me to purchase a property with a lot less money down and also you can get a great interest rate if you owner occupy it. Would be happy to chat and answer any questions!

My first deal was a 4 bed 2 bath single family in Grand Rapids, MI. I searched for a few months using a local realtor and eventually purchased the property for $41,500 (this was in 2014). After about 3k in renovations it rented quickly for 1k a month. I remember the home inspector (inspections were still a thing back then) trying to talk me out of buying it because he had a bad experience with rentals. I was young at the time and almost didn't make the purchase. Last year, after 25k of renovations, I sold the property for 200k. Real estate can be a phenomenal investment over time and I am thankful I made this purchase. I am still new to this and finding a deal never gets old :) 

Was the vacancy due to renovations? That seems like a long time for a unit to be vacant. I would say look at the numbers comparing what you would reasonably expect future performance on this property to be vs. an investment in Ohio for the next several years. Then, do what makes the most sense financially without getting too much emotions involved, numbers don't lie :)