All Forum Posts by: Zachary Jensen

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $525,000
Cash invested: $80,000

Househacking this duplex. We’ll need to do some work still, but it will cash flow when we move out a few years down the line.

What made you interested in investing in this type of deal?

I have always been interested in buying a small multi family home for our first home purchase. It is also the only way we were able to afford a home in San Diego.

How did you find this deal and how did you negotiate it?

Found it on the MLS. We were able to put it under contract before it was officially on the market though by coming forward with a conventional loan offer instead of an FHA offer.

How did you finance this deal?

Conventional loan with 15% down. We had to borrow from a 401k loan and from my parents in order to come up with the down payment.

How did you add value to the deal?

It appraised for 35k over our offer price, so that was a good start. We also plan to replace carpets, add A/C, and remodel the kitchen at some point.

What was the outcome?

We just barely closed on it, so I’ll have to let you know!

Lessons learned? Challenges?

I learned how valuable it is to have quick access to capital from a loan. I intend to open a HELOC as soon as I'm able to in order to purchase future properties.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I worked with my brother Chris Jensen who is a real estate agent here in San Diego and Marty Brumfield was our loan officer. Both of them were excellent to work with and very knowledgeable.

@Sam Wilson I really like the idea of timing the rent increase with home improvements.  The unit they are in could use some updating, so maybe that would be a better way of couching it.

I'm just about to close on my first rental property (house-hacking a duplex in a small town outside of San Diego, CA).  The previous Landlord raised rents 3-5% every year on this property, so it is currently rented for market rent to some great tenants who have taken good care of the place.  My wife is a wonderful person and very generous.  As a result, she doesn't want to continue increasing the rents on a yearly basis.  I could really use some help making the case for the importance of yearly rent increases.  I understand that property taxes increase on a yearly basis and that any maintenance costs also go up on a yearly basis.  What are some of the other reasons for maintaining regular annual rent increases?

@Arnie Abramson thanks for your reply! So is it possible? How does it work? Maybe we could set up a time to talk?

It sounds like usually you have to be at the auction in person.  Is there a way to do it without being there?

I'm trying to buy my first small multi to house-hack with an FHA loan in Utah in the area around Hill AFB (Ogden, Clearfield, Riverdale, etc.). A lot of people when they talk about house hacking say you should make your offer such that your portion of PITI plus expenses is less than what you would pay to rent a similar unit. However, the issue that I'm running into is that if I price my offer that way, I will have negative cash flow when I move out. And if I make my offer such that it cash flows after I move out, my offer is too low to compete with any other buyers. Any recommendations?

@Cason Acor For now, the plan is to flip individual units.  I think it would be great to do do entire parks at some point, but I'm not quite there yet.

@Caleb Rigby That's great!  Sounds like an awesome deal!  Thanks for the suggestion!  Have you ever heard of individual homes going for less than that here?  I'm just not sure what to expect to pay for a mobile that needs some help here.  Sounds like a great deal though!

@Susie Lowe That's great!  I don't know of anything, but good luck!  I hope it works out!

@Rachel H. Thanks for the tips!  I'll definitely try that.

I'm thinking I would really like to start investing in Mobile Homes/Manufactured Homes in Utah preferably in the Ogden area (mostly because that's where I'll be living starting this summer).  Is there anyone here who has done it?  I'm looking to buy from motivated sellers at a discount for cash and then sell on seller financing at market rates.  I'm just beginning my research for this strategy so I would love to talk to someone who has done it.  Any tips?

I haven't been on BP in the last week or so and am only just seeing this.  How did it go?  Are you going to do another one at some point?  I'd be interested in attending.

@Caleb Rigby First off, great info. I'm looking to start using the BRRRR strategy in Ogden area and I had one clarifying question for you about the numbers you mentioned. Are they based on you doing the work yourself or using contractors?