I am still new to the BP community and real estate investing in general, but I have heard multiple times that house hacking a 4 plex is the best way to start out. I have an opportunity in Jacksonville, NC to do just that. It is a VA foreclosure so it is somewhat discounted, but it needs a considerable amount of repairs (water damage, mold, door frames rotted). Even with these additional expenses, I can get the BP multifamily spreadsheet to turn out a positive annual cash flow (though only about 1k for a 30yr).
My question is, is this actually a good idea? I have the money to put down for the down payment and repairs, but that does spit out a low ROI. Also, I am using a 95% occupancy rate. The similar units around this one are all rented. I am about halfway through the due diligence period and this information about repairs is coming from the inspector I hired. I suppose I am just suffering the first time investor anxiety, but i thought perhaps some those smarter than me might have some insight.
Thank you for your time!
Even though it will have low ROI for the near-term future, it may be worth it for the appreciation. Have you figured out what the ARV would be once you finish the repairs? Have you taken into consideration how much you'll be able to increase rents after repairs?