Getting Started With an Initial Time Restraint
Good day.
I am new to REI and Biggerpocksets and looking for thoughts on a starting point. I've read the Long-Distance REI and in the process of reading the beginners guide, but a change has made time of the essence. I am in St Petersburg, FL, currently renting, and approved for a VA loan of $300,000. I have a low DTI.
My initial plan was to purchase a multifamily and rent the other apartments out. I have found it hard to find a decent property within my budget. I now must move within the next months. To get a steady home base, I was thinking of putting the multifamily on hold and purchasing a single family under $150k or a condo for less. Should I hold there, fix it up, build that equity from there, or should I use the other $150k to purchase a second single family to use both as BRRRs? Are there more lucrative or efficient ideas out there?
This also brings up a question I haven’t answered yet. Besides my regular income, is there other places to receive a loan to repair the property? I am handy and a coworker is also a general contractor, so much of the slow work we could do.
Please do not feel to break this down on the lowest level.
Sincerely,
John
For the scenario where I find a home for under $150k of the $300k, would that be a good time to try to purchase a short sale with the rest?
@John Ballard
Hey John,
I currently am house hacking on a FHA loan in Seminole Heights in Tampa. One extremely fortunate (and well deserved) benefit you have available is the VA loan. I suggest anybody who has the means to "house hack" on a VA loan, to do it! I'd be happy to speak with you and answer any questions you may have. There are some solid properties for house hacking in the Tampa Bay area, at or under $300k.
#2 General Landlording & Rental Properties Contributor
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#2 General Landlording & Rental Properties Contributor
@John Ballard Talk to your loan officer about buying two homes vs one. i don't know if there are restrictions on the VA loan. If you have the down payment for two and can get the loan, that is a great alternative to multifamily rentals. As for a short sale, if you need to move in a few months, they take longer than that to close. It is a good option for a second home, but not your primary residence if you are under time constraints. the worst thing you can do is rush into something because you need a place to live.
Thank you @Theresa Harris. I have confirmed with my lender and other lenders/realtors a few times that I am able to buy multiple properties with the VA loan, as long as I live in the first one and follow those rules. I will say that although she explained it clearly, so many people were absolute that it wasn't allowed, but had never tried it.
One of my plans were to move in to something inexpensive quickly and use the rest to work on a short sale with the other half. That would also give me time to work on the house I live, read more, and work on the long distance investing research.
@Anthony Kelly Thank you. I will reach out to you.
Sincerely,
John Ballard
#2 General Landlording & Rental Properties Contributor
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#2 General Landlording & Rental Properties Contributor
@John Ballard I'm glad that you checked. Your plan sounds reasonable. Remember when buying an investment property, you are looking for something where the numbers work and the house is solid. It is less about personal preference. Good luck!
@John Ballard
Check out this podcast:
https://www.biggerpockets.com/blog/2015-01-01-bp-podcast-103
Her website is: https://www.reluctantlandlord.net/
Her and her husband got started using a VA loan for their first house hack. I think I'm remembering the podcast correctly. Now they are 7 or 8 properties into the game since 2012. I'm able to find 2-4 unit MFH's in FL long distance from CA in the MLS using the 2% rule. BP's rental calculator is pure gold in making quick deal decisions by analyzing multiple deals to narrow down best options. I found an agent who is an investor/self manager too. That helps.
I love the podcasts and webinars on BP. They gave me the confidence I needed to jumpstart my journey into real estate investing. I'm currently in the offer phase of two duplexes that are slightly shy of the 2% rule. Fingers crossed they accept my offer, but ultimately it's just good practice if they don't. One deal fell through here in CA after they accepted my offer because the agent listed it improperly as a three unit home. My lender checked the title and discovered the third unit converted garage was not permitted. I didn't have the budget to redo it. The seller wouldn't reduce the list price to reflect the duplex as it states on the title so I cancelled the deal within the 72 hour window.
I am not sure if it's my search, the area, my lack of knowledge, or some other variable. I am not finding the deals in the non "war zone" areas of the greater Tampa and St Pete Area that fit the 1% rule for multifamily. To the point, my realtor and I decided we would go look at a street that has multiple duplexes (73RD AVE N ST PETERSBURG, Florida 33702). We decided that we could look at one and get a basic idea for all of them. I also felt that they were all $40k over priced, so we planned to come in low. As I walked to the back of the back yard, a woman in the alley propositioned me.