What you think about my game plan ???

Question

Hey !

So currently I’m in the military and my credit score is 670. I don’t have any multi family houses near me the closest ones are 1 hr of a drive. So I was thinking to house hack a single family home using a VA loan. Buy a house around 100k live in it and  collect the extra income in  my BAH. Then save up money to invest in one of the multi families a hour  away.

Chance Brookins · Answer

@Charles Carillo yeah I have , I’m from Panama City Florida and have a lot of boots on the ground there. But that place just got hit hard by hurricane Michael so the houses are in pretty bad shape , but I guess that could be a good thing 🤔

Bryan C. · Answer

Chance, as a fellow military investor the biggest concern i have is education.  Educate yourself first & take action second.  Maybe you buy a property and live it in with roommates (others from your unit etc).  Having roommates can cut down on your costs and possibly enable you to live there for free (depending on how much rent you collect).  At the same time you then become the landlord which means ensuring things are fixed properly & promptly.

Using your VA loan you can buy up to a 4 unit bldg as long as you live in one unit, or you can buy a SFH and rent out rooms to people.  Great way to get started.  Another option is investing in another area you are familiar with (you mentioned near Tyndall AFB).

Mike Roy · Answer

@Chance Brookins - Thank you for your service!  Very good idea to save that BAH money.  My brother did that for four years, and that set him up for a nice post-military path.

The VA loan is a great option for those who intend to hold their house for a long time, as equity is build very slowly on zero-down.  If you go in with zero-down on a $100k house, it needs to appreciate about 6%, or about $6k,  just to break even on a sale.  Definitely some risk there if this will be a shorter term hold.

If you're planning on having roommates anyway, why not just rent a 3-4 bedroom apartment with them?  I see plenty of 4BD houses for $1,600 on apartments.com, enabling you to save $1,100 of the $1,500 BAH if your share is $400.

So you might pay a little more to do it this way, but it could be a good way to go if you want to guarantee that you will not be stuck with the headache of a potentially underwater starter home in Dover when you decide to move on.

And if the lure of a zero net mortgage continues to pull you toward a purchase, just keep in mind that the $400 you pay on the rental scenario can become a $400 or more payment on a purchase when the roof, HVAC, foundation, etc. start to fail, which are all near-term possibilities at that price point..

Adam L. · Answer

That is not a bad idea at all and I always recommend people save money from their BAH. It may be hard to find, but almost every location has du/tri/quadplexes to choose from. You can even look for a house with an in-law suite that you can rent out as well. If you do buy a traditional house, make sure you can get rent it out with some cash-flow when you PCS. If you are buying a house when moving around you should always try and set yourself up for cash flow when you leave.

Sure, you may end up just buying a house because you want to live in that house. Just remember you are buying that as a liability not an asset.

Howard Todd · Answer

@Chance Brookins. When I was still in the navy I rented the biggest affordable place I could.  Then I rented the rooms out(I was lucky I was able to turn the living room into a master bedroom.). By renting you can stay mobile and not worry so much about the risks of short term home ownership.  (Pick an arch type for who you want to live in your apartment.  I choose engineers and geeks.. the just wanted the best Internet and they were shut-ins.

Take the time to study the market you want to invest In when you get out.. it sucks trying to decide wether to sell at a loss and move home or stay away from family even when your out.

Chance Brookins · Answer

@Tahiv Grantham it’s how much he military gives me for rent,utilities . It’s 1500 a month for my BAH

Adam L. · Answer

Are you working with a real estate agent by chance? They may be able to help find other things to go after and find those in-law suites as well.

Tahiv Grantham · Answer

@Chance Brookins what is BAH?.

Charles Carillo · Answer

@Chance Brookins

Thank you for your service.

Have you ever thought of investing further from your home or in another area where you have boots on the ground?

What you think about my game plan ???

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