Conventional financing with a construction loan.

The often quoted cyclical nature refers to MF properties, as developers respond to demand, build inventory until there is too much etc..The residential market does no go through cycles, just google homes values over the last 60 years.

We need a healthy down payment, but luckily with the shift in pricing we appear to have a lot of room between what's left on the current mortgage vs. what the property will most likely appraise for...The main problem I am trying to tackle in my head right now is if refinancing in July when we close in October/November (and we will need/use conventional financing for that home) really a good idea?

I do see a lot of inventory down there. 

The opportunity to make money might be their its just not obvious or conventional. 

@Mark Vesu I see your thread got highjacked a bit, I have a recommendation for a broker for you if you cannot do a conventional loan but I am actually working on a cash out refi for that same loan size in San Jose right now on someone’s primary home if you don’t have problems with DTI like many investors and can do a conventional loan, reach out to me and I can give you some numbers or pass on the broker

Maximum loan amount for preapproval would then most likely be 95% of an appraised value of 440k for a conventional loan, or if you've gone > 3 years without buying a home you'll qualify as "first time" so 97% LTV would boost your appraised price range to 733k. 

With the foreclosure forbearance hopefully coming to an end soon, that will bring in a lot more inventory in the future which may make it easier for us but I think our goal is to focus on building capital.

With the foreclosure forbearance hopefully coming to an end soon, that will bring in a lot more inventory in the future which may make it easier for us but I think our goal is to focus on building capital.

Commercial C-1 zoning may allow mixed use or retail on the frontage but this is a hard stop to gaining conventional financing.