First Time Buyer, Potential House Hacker / Out-Of-State Investor

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First Time Buyer, Potential House Hacker / Out-Of-State Investor

Destiny Malloy
Member since 2022 · 4 posts · 2 votes

Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!

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Steven Foster Wilson
Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
4y
Quote from @Destiny Malloy:

Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


 Hi Destiny, 

The majority of my clients here in Columbus and other parts of Ohio are out-of-state investors. The price-to-rent ratio makes for great investments. Not to mention our appreciation has been 8% higher than the US national average, because of the high demand for affordable housing. Thus, we have a lot of OOS investors flocking here. I think you have to trust your team and work on building your core 4 https://www.biggerpockets.com/... in order to make the investments work. 

If you want to stay local then I would start to cold call. Go to as many networking events as you can! The more you get out there the more likely you are to find great deals. If you are worried about safety and considering an SFH then rent out your rooms. That will also bring in more cash. My wife and I live in a duplex and we still rent out a room in our house because we love living with people.

I would get used to running more numbers https://www.calculator.net/ren... I like to use this calculator. By doing that you will be more familiar with when you find a good deal. 

Keep listening to the bigger podcasts, I even recommend listening starting at the very beginning. 

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  • Cassidy BurnsBusiness Member
    Investor · Alexandria, VA · Member since 2016 · 861 posts · 460 votes
    4y

    In Washington DC, if you can qualify, I believe the duplex is the best house hacking situation.  

    Rent out the lower level unit. And then if you are able , get roommates to live with you in the upper level (try to buy a unit with at least 3 bedrooms upstairs).

    This is the ultimate house hack in the DMV, but will be around $1million-$1.2million purchase price.  

    Good luck! 

    [email protected]540-960-1507
    0Reply
  • Jason Piccolo
    Real Estate Agent · Arlington, VA · Member since 2014 · 78 posts · 37 votes
    4y

    Hi Destiny,

    I house hacked my first property in Kingstowne (Alexandria, VA). I bought a two bedroom townhouse style condo with a garage and rented the second bedroom to a friend of mine. The situation worked out well and I was comfortable with the living situation. These same condos are selling for the high 300's. It is a great way to get your foot in the real estate door and build some equity.

    0Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    4y
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


     This ultimately comes down to price. What's your price point?

    [email protected]301-893-4635Podcast Guest on Show #192
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    0Reply
  • Destiny Malloy
    OP
    Member since 2022 · 4 posts · 2 votes
    4y
    Quote from @Russell Brazil:
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


     This ultimately comes down to price. What's your price point?


    I don't have much money to start out with (so far I have about 30,000 saved for down payment+closing costs), but I am continuing to save (and learn!). I know most of the duplexes in this area will be near $1mil, so I am also considering buying a larger SFH and renting out the rooms either in the northern VA or MD area.

    0Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    4y
    Quote from @Destiny Malloy:
    Quote from @Russell Brazil:
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


     This ultimately comes down to price. What's your price point?


    I don't have much money to start out with (so far I have about 30,000 saved for down payment+closing costs), but I am continuing to save (and learn!). I know most of the duplexes in this area will be near $1mil, so I am also considering buying a larger SFH and renting out the rooms either in the northern VA or MD area.


     A single family where you can rent out the rooms is an option many in the area use if they cant get into a legal multifamily. Keep in mind each state here has different occupancy limits. Virginia allows 4 unrelated people, Maryland 5 and DC 6.

    [email protected]301-893-4635Podcast Guest on Show #192
    District Invest Group545 Reviews
    WebsiteView Page
    0Reply
  • Destiny Malloy
    OP
    Member since 2022 · 4 posts · 2 votes
    4y
    Quote from @Russell Brazil:
    Quote from @Destiny Malloy:
    Quote from @Russell Brazil:
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


     This ultimately comes down to price. What's your price point?


    I don't have much money to start out with (so far I have about 30,000 saved for down payment+closing costs), but I am continuing to save (and learn!). I know most of the duplexes in this area will be near $1mil, so I am also considering buying a larger SFH and renting out the rooms either in the northern VA or MD area.


     A single family where you can rent out the rooms is an option many in the area use if they cant get into a legal multifamily. Keep in mind each state here has different occupancy limits. Virginia allows 4 unrelated people, Maryland 5 and DC 6.


     That is great to know! Thank you!

    0Reply
  • Joaquin Camarasa
    Real Estate Agent · Springfield VA · Member since 2018 · 480 posts · 400 votes
    4y
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


    I househack a single family home in Springfield VA.

    When you are starting out it is better to start househacking, you'll learn to manage tenants, fix small repairs and reduce significantly your mortgage in the process. Focus on what you can control to start out. Unless you are a pretty high income earner, multifamilies are out of reach. 

    In order to be more specific with what might specifically work out for you, we would need to know which area you work in (reasonable commute times) and budget as mentioned above would be also key to narrow down options. Talk to a lender so you get a feel of what you might qualify for with your current financial situation.

    In the meantime as you prepare yourself to buy in the next few years, get familiar with different types of property and regulations for each county, when the moment comes you'll know exactly what is the living situation that suits you the most. 

    0Reply
  • Matt Solis
    Real Estate Agent · Dallas - Fort Worth Metroplex · Member since 2020 · 66 posts · 57 votes
    4y
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!

    House hacking a SFH would be the best way to get started IMO. High leverage investment, high potential for cashflow, live for free, great way to get started. I don't know your market, but if you say multifamilies are rare/expensive, you could be waiting for a long time before you get one. I'd look for something with at least 4 bedrooms. Look for properties that you could easily add additional bedrooms (an office or game room that could be a bedroom, an area of the house that could become a bedroom with a couple of walls, etc.).

    As far as finding tenants, remember that you can be REALLY picky. Fair housing laws are more relaxed if you’re living in the house, FYI. Use roomies.com or spareroom.com to advertise your rooms. I would recommend having a list of must-haves in a potential roommate and screen out the tenants via messaging first, then graduate to a phone call, THEN a tour of the house, and only then do you send them the application (if you like them). Make sure the application includes a background check, credit check, eviction history, etc.

    Feel free to reach out if you want, I have two house hacks and manage 9 tenants currently.

    1Reply
  • Steven Foster Wilson
    Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
    4y
    Quote from @Destiny Malloy:

    Hi All, I am currently living with my parents and hoping to be able to move out in the next 1-2 years. I would like to buy a duplex in my area (DMV), but there are not many multifamily properties in the area (and the few that are in the area are very expensive), so it would be hard to find a deal I can afford. I am worried about trying to house hack a single family home for safety/security reasons. I have not done much research on out-of-state investing as I am worried about getting out-smarted by professionals who know that area better (I would also really like to find something that I can move into for at least the first year so that I can get out of my parents hair). 

    I am looking for advice on how I can get started as a first time home hacker in a tough market? Are there other factors that I can consider that would make house hacking in the DMV more doable? Are there safety measures that others have used in SFHs when house hacking to make it feel more secure? Is there anyone in the same boat who tried out of state investing as a beginner and was able to generate some cash flow? All articles/books/podcasts you can recommend for me to learn more about my options are appreciated!


     Hi Destiny, 

    The majority of my clients here in Columbus and other parts of Ohio are out-of-state investors. The price-to-rent ratio makes for great investments. Not to mention our appreciation has been 8% higher than the US national average, because of the high demand for affordable housing. Thus, we have a lot of OOS investors flocking here. I think you have to trust your team and work on building your core 4 https://www.biggerpockets.com/... in order to make the investments work. 

    If you want to stay local then I would start to cold call. Go to as many networking events as you can! The more you get out there the more likely you are to find great deals. If you are worried about safety and considering an SFH then rent out your rooms. That will also bring in more cash. My wife and I live in a duplex and we still rent out a room in our house because we love living with people.

    I would get used to running more numbers https://www.calculator.net/ren... I like to use this calculator. By doing that you will be more familiar with when you find a good deal. 

    Keep listening to the bigger podcasts, I even recommend listening starting at the very beginning. 

    1Reply
  • Aj Parikh
    Rental Property Investor · Centreville, VA · Member since 2019 · 1k+ posts · 799 votes
    4y

    Hi @Destiny Malloy I am also an investor in the Northern Virginia area and since the prices are too high for getting into rental properties in our area. I chose to work with a couple of turnkey companies in Cleveland and build my portfolio. I started in 2020 with this strategy and I have been able to scale to 8 units now in Cleveland so definitely recommend going out of state. Let me know if you want to connect and chat about it.

    0Reply
  • Jarreau Jackson
    Rental Property Investor · Atlanta, GA · Member since 2021 · 28 posts · 13 votes
    4y

    Great post and I welcome your hesitancy because you’re utilizing a great platform to offer multiple POV’s!

    I have some suggestions/comments:

    1. If you get started in this process, you will likely discover a clearer path

    2. Find a lender (maybe start with BP’s search) or a dope agent (BP’s agent finder). 
    3. Get pre-approved to help you refine your strategy 

    4. Based on your liquid cash and pre approval amount, start experimenting with BP's mortgage Calc when viewing MLS listings to get comfortable with the inputs for monthly fixed costs. Add this exercise to your daily deal analysis practice.
    5. setup subscriptions for small multi’s above 3,000sqft with Zillow etc to see what hits your inbox and keep running the numbers

    6. Check out Craigslist as well

    7. Drive to the neighborhoods where some of these deals are that you’re analyzing to test your appetite for “safety” or feel. Could you live in this hood for a year?

    8. Continue to network with agents, wholesalers, and top property mgrs - you never know they may throw you some deals!

    9.research lending programs like FHA to build your biz plan - talk to your lender about your options

    10. Perhaps seller financing deals may better serve you

    11. Visit sites like city-data to research market trends to refine your buy box

    These steps are to build your confidence in analyzing deals and the market. Through this journey, you will start to build a realistic criteria/buy box and you’ll be jumping in taking action. Good luck!  

    0Reply
  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    4y

    @Destiny Malloy

    If you are new to real estate investing, you should partner with an experienced agent or investor.

    I recommend you to get in touch with an agent or investor as they have access to more resources and financing options.

    You can start by joining local real estate clubs, attending meetups and connecting with local agents and investors.

    Do a thorough local market research and analysis.

    A local Investor-Agent can help shorten your learning curve and save you a lot of headaches as they tend to understand the market better.

    Here are steps for getting started as a real estate investor.

    1. Determine your investment strategy
    2. Become an expert in your field
    3. Understand the market
    4. Have access to plenty of working capital
    5. Learn the local real estate rules and laws

    Read this article for more information https://learn.roofstock.com/bl...

    Good Luck!

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