All Forum Posts by: Pablo Cuevas

Hey Mateo, hope you're doing well! REI is great, I went down this exact path, got into REI in college, and I ended up getting a house hack a little under 2 years ago. The property I got is in the medical center, a $260k, 4 bed, 2.5 bath house, newly replaced roof, 20 year old AC, 20 year old water heater, all old appliances basically, high water pressure, and yeah overall outdated house that needed some touchups. I got it at 5.5% interest, monthly mortgage of $2000. I rented out the other 3 bedrooms to my college friends and only paid $200/month toward my mortgage, while they paid the rest. So you will have to consider all these things and their costs, along with any other renovations you will need to make for your potential property, and the prices that go with those as well. I, as a newbie, didn't know much about any of these things until I had already bought the house and there was a lottttt to learn as time went on and things broke, or I discovered things that didn't come up in the inspection, that later needed fixing.

So that being said, it depends on you, and how much risk you are willing to take on. Do you have the capital to take on all these renovations and potentially more? If you do, then go for it, but conduct your due diligence thoroughly, you don't want to get stuck in a flip that you can't afford to rehab, because of bad planning. And if you later on realize it's too risky for you, then a simpler house hack would probably be better to get you started in REI with less risk than a flip.

As to the location, its hard to say which is better to invest in. Both areas can be good, you just have to find the right deal and find out whats best for you. For example, I got my property in the medical center bc its close to UTSA for my tenants, and when they move out I can rent it to travel nurses, UTSA students, or medical students. So if you live in your househack, where do you want to live by? Do you want to live in a nice neighborhood, up and coming neighborhood, bad neighborhood? I would look at both areas everyday on realtor or redfin, check out the houses run numbers on them, and over time you will start leaning more towards an area while also zeroing in on what youre looking to buy. 

There is a lot more that should be said, but I would say figure out your time horizon for buying a property, North or West SA, find what purchase price you can afford, how much you can put towards a rehab, how fast can the rehab be done, and your exit strategy for when it is flipped. Exit strategy being, once flipped, will you continue to live there and rent the other bedrooms out? Take your money out with a refinance and get another property? STR? Sell it? etc

Reach out to me if you have more questions.

Quote from @Joseph Cacciapaglia:

Quote from @Pablo Cuevas:

Quote from @Joseph Cacciapaglia:

Quote from @Pablo Cuevas:

Hello John!

Canyon Lake STRs seem to underperform STRs in San Antonio, based on what I've seen. We manage several properties in the greater San Antonio area, but not a lot in Canyon Lake. The seasonality makes it a riskier endeavor as well. I spend a lot of time helping clients find STRs as an agent, and have rarely found great deals in Canyon Lake compared to San Antonio. The thing to really lookout for there is that Airdna is pretty unreliable, because it fails to take into account lake views and water access. It's really easy to make a bad buy there, compared to San Antonio, where you don't have that same nuance.

They underperform SFH STRs in the city is what you're saying (correct me if I'm wrong)? I am looking to get a waterfront lake house, so I would imagine it wouldn't be booked as much as a SFH STR because of the seasonality of a lakehouse. I also want to be able to use this lakehouse for myself a few times a year. I want to be able to have my own escape that pays for itself through those 7-8 months, and either just go for a weekend during those peak months or when demand dies down. Have you seen other lakes near SA that perform better than Canyon lake, and perform closer to SA STRs? 
I was just thinking with those 4 cities close to Canyon Lake, it would be great location. 

Thank you for your response!

Yes, I'm saying that they underperform SFH STRs in the city. The waterfront homes are so expensive relative to the ADR, and the occupancy tends to be worse than in the city, because of the off season. I believe most of the STR investors in the Canyon Lake area are similar to you, in that they want to use it for themselves as well. This leads to a market where prices are higher than they would be from a pure investment standpoint. However, the additional benefit of personal use may make it worth it to you.

I don't think it's much different near the other lakes in the region, but Canyon Lake is the one I'm most familiar with.

 Perfect thank you so much Joseph! I think this information and other information from my other research is telling me not to take this one on just yet, but build a better foundation for before I do. 

I only have a house hack going for me right now, and just got out of college, so I think a STR with less risk and more for sure cash flow is what I should go for right now. Maybe use those to pay for the lakehouse's losses down the road.

I will keep you in mind for when I'm ready for my next SA property, and first STR! Forecasting that time to be in around 1.5 to 2 years. Again thank you for all your help!

Quote from @Michael Baum:

Hey @Pablo Cuevas! Lake houses are great rentals and ours does very well.

Like @John Underwood said, there are a few things different than in the city.

Bugs, bugs, bugs. Seeing as ours is pretty far out there we get a ton of bugs. I call it out in our listing so people aren't freaking out about 60 ladybugs inside the house in the spring or all the spiders.

You will want to make sure you have dock insurance and upgraded overall insurance. Seeing as you are the water with a beach, risk goes up.

Like John said, good views and water depth are the most important. Also, access to the water. Too often you see a lake house with a beach is tough to get to.

One other thing if it is rural, getting a good cleaner can be a bit tougher. If you have a large yard, maintenance folks will have to drive out there so it can be more expensive.

 Hello thank you for responding! 

Yes! I went to a lakehouse a few days ago, and there were so many little bugs flying around, I think screening the back porch, like John had mentions is such a good idea to help with this problem. 

Yes when I am looking at lake houses right now, the first thing I have been looking for is the water access, which will tell me if this is the kind of house I am going for or not and the numbers connected to it. And the cleaning I can understand how that can add up. 

So the expenses of a lake house are that of a normal STR + special insurance and possibly more expensive cleaning expenses depending on amenities? Is the difference much larger, or is it $200-300 more a month roughly?

Quote from @Joseph Cacciapaglia:

Quote from @Pablo Cuevas:

Hello John!

Canyon Lake STRs seem to underperform STRs in San Antonio, based on what I've seen. We manage several properties in the greater San Antonio area, but not a lot in Canyon Lake. The seasonality makes it a riskier endeavor as well. I spend a lot of time helping clients find STRs as an agent, and have rarely found great deals in Canyon Lake compared to San Antonio. The thing to really lookout for there is that Airdna is pretty unreliable, because it fails to take into account lake views and water access. It's really easy to make a bad buy there, compared to San Antonio, where you don't have that same nuance.

They underperform SFH STRs in the city is what you're saying (correct me if I'm wrong)? I am looking to get a waterfront lake house, so I would imagine it wouldn't be booked as much as a SFH STR because of the seasonality of a lakehouse. I also want to be able to use this lakehouse for myself a few times a year. I want to be able to have my own escape that pays for itself through those 7-8 months, and either just go for a weekend during those peak months or when demand dies down. Have you seen other lakes near SA that perform better than Canyon lake, and perform closer to SA STRs? 
I was just thinking with those 4 cities close to Canyon Lake, it would be great location. 

Thank you for your response!

Hello John!

Thank you for your reply! Definitely gave me more to think about with this kind of property! 

I was specifically looking in Canyon Lake, since it is between Austin, San Antonio, New Braunfels, and San Marcos, I think that could draw in a large amount of potential renters.

If you don't mind me asking, what is the size of your lake house, and how does the income vs expenses playout? Does the lakehouse prove to be better than an urban rental?

Thank you!

Hello BP!

I got into the idea of real estate about two years ago, and I just got my first property a few months ago, as a house hack. I have been working hard on it, fixing up a bunch of small things, and I couldn't help but look towards what's next. I went on a getaway to clear my mind a bit, and I went to a lake house. It was super nice relaxing and I loved it. That sparked the idea of getting a lake house, and doing what the hosts are doing.

So I started researching a lakehouse as a short-term rental, and I haven't been able to finnd all the information I have been looking for. I don't know anything really about what goes into getting a lakehouse, or the upkeep of this kind of property, the different costs of it, etc. 

I was just hoping to get help here, get some first hand experience advice from someone with this kind of real estate experience. I proposed this idea to a friend of mine to partner up and take this beast on. If it does turnout to be what I am thinking of as a good investment, I am planning on taking it on in 1.5-2 years. For the mean time I am going to save up and research this as much as possible. 

So if I can get a little help with this, that would be greatly appreciated! Looking forward to hearing back from you BP! 

Thank you!

-Pablo

Hello BP,

So I had planned to house hack (live-in flip) over a year ago, and I planned on talking to lenders and getting the whole loan process started in March and hopefully done by May, to put offers on houses and close in June/July. After talking to this one lender for a month now, he is just now telling me that I won't qualify for a loan because I am a part time worker, and I had a two month gap in my work history over a year ago. 

I am having my parents as cosigners on this property, as I don't have enough income to get a house of my budget on my own. I thought the cosigner would help out with the low income and work history gap. Is there no way around this? I had been talking to this lender for a month and I just feel like he wasted so much of my time only to tell me that until I work two years without a gap and as full-time, we can't get a loan. Is that going to be a problem with all lenders, or was that just this lender that didn't want to take on that risk? 

If anybody in the San Antonio area knows of a lender who can help me out with this, that would be great!

@Kyle Ly

Yes the location has been my priority since I had started thinking about getting into house hacking! Thank you for the push!

@Anthoney Hanks

Hey thank you Anthony, I will definitely have to take a look at it tonight!

@Dan Guenther

Hey Dan thank for responding!

So I have the location down already I have been checking zillow multiple times a week to see how fast the houses sell and prices. I know where I want to buy the house the ideal location, and also the next area if the ideal doesn’t work out.

I have also decided that I do want this to be a long-term rental for students in the college area and even for those in the medical center area. The first two years will be for my current roommates and then I am planning on moving out. I want to hold it as a full rental after those two years and then get another property, starting the process over again.

So my main question is how do I search and find a good investment property, what numbers to crunch and look at, which will then tell me whether this property will be a good investment in the long run or whether I will end up earning very little or losing money when I turn it into a full rental?

The location and the time horizon are set it is just the numbers that I am not totally knowledgeable on, and seeking advice on.

Thank you for your help Dan.