All Forum Posts by: Keira Hamilton

Do you have an idea of how much funding you're looking for? Do you have any experience in ground up construction? Would the house be income producing?

As far as rental income, you can look for comparable homes on Zillow for rent. You'll need to look at a range and find the average. You can also contact local agents in the area and ask what they're seeing in the market.

For determining rehab costs, are you planning to do a fix n' flip as your first investment? It can be done, but it might be a lot to take on, especially if you're considering out of state properties.

It would depend on how the rates you qualify for on an unsecured personal loan compare to the rates of a cash out refi. Keep in mind lenders often have minimums for cash out refis, so depending on the ARV you might not even qualify. Either way, you're going to end up paying to get capital. Also, you mentioned that you're not necessarily looking for a 20/30 year loan. Conventional lending is going to tend to be in this range, while a personal loan would be more 5-12 years.

Whether or not it's better to save and make an investment later or invest with what you have now really depends on your goals and what markets you're looking at. Generally speaking, real estate investments will appreciate over time, so any time that your money is not invested is time that it's likely not appreciating at the rate it could be were it put into real estate. Of course, that doesn't mean just throw all of your capital into one deal, especially if you want to make multiple investments in the next few years.

Have you done any research into particular markets yet? Do you have a sense of how much capital you would need to get your foot in the door?

Lenders usually have minimum value requirements (often $100k), so it may be difficult to secure traditional funding, although I understand not wanting to lay down all of your cash. For a purchase of that dollar amount you may consider an unsecured personal loan.

If it's not going to be your forever home, then another thing to consider would be how long you would plan to be there. Real estate does continue to appreciate over time, but we're also in a period right now where home values in many areas are going down. My property has dropped about $100k in the last year. Of course, no one can say for certain what's going to happen over the next few years, but you wouldn't want to be in a position where 3 years from now you want to sell and the value is too low to make that a good option.

Many lenders won't let you use a loan as a down payment. You have a few options: 1) You can purchase a property as your primary residence and likely see better loan terms. 2) You can create a savings plan to build up the needed capital. 3) You can invest in a less expensive market where your capital will go further.

I would ask yourself what your reason is for wanting to own the home you live in. People tend to have an (understandable) emotional connection to their home and often feel more autonomous when they own it. While there's validity to that, those feelings can get in the way of making the best financial decision. If I were in this position, I would just focus on the numbers. What is the rent you're currently paying in SoCal and how would it compare to a mortgage payment should you choose to buy a home? How do those payments compare to the potential rental income of another investment property? There's not really a right or wrong answer here as every investor has different goals, but I would just see what situation would result in the highest monthly NOI.

Hey Jenn! A "higher amount of capital" is really relative. What type of investing are you looking to do? 

There are certainly private lenders who can fund 5+ units. I would be happy to get you connected with some!