19 Year Old Wanting to Househack His Way To Success!

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

Hi! @Jon Morgan

Thank you for your advice and for taking the time to reach out, it means a lot to us newer investors who are trying to soak up as much wisdom as we can :) I agree, i'm trying to figure out what to focus on, and find my niche/best way to generate more income for a down payment.

I really like that idea! The only concern I have is that once I move into the SFH, I wouldn't be able to get any return from it until I moved out, unless I rent the other rooms out, which i'd rather not do just for privacy reasons. That's why I was looking into multiplexes, because it's the next best thing, but way capital is required unfortunately. Also, if I did a FHA, I wouldn't be able to move out for a year, correct?

My girlfriend goes to college in Lawrence, KS, and I live with my parents in Kansas City, KS, so i'm looking for an investment property halfway between the both of us that we can both live in for the next 4 years until she finishes school.

Feel free to message me and grab my email, facebook, or phone # if you'd rather talk that way.
I'm looking to make some friends in the real estate world! BP is fine too if not!

Daniel Haberkost

Rental Property Investor · Colorado Springs, CO · Member since 2018 · 682 posts · 729 votes

6y

@Account Closed It's hard to beat a house hack to start, have you spoken to any lenders to get pre-qualified?

Housing is so cheap where you're at that you should have enough (or close to enough) for a down payment. If you start there, then you can eliminate your housing expense which greatly accelerates your saving rate, start building equity and get your first experience as a landlord.

Dan

Jon Morgan

Rental Property Investor · Leavenworth, KS · Member since 2018 · 22 posts · 18 votes

6y

In order to walk 100 miles you must take the first step. Buy a house!

2 Reply

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

Hey @Daniel Haberkost! Thank you for reaching out!

I haven't talked to any lenders just yet. I currently have no credit, but I've recently found a good credit card to start building my credit score. I figured talking to different lenders would be a good option just to see what options are available, but I feel like I'm not ready yet for some reason.

Yes! That's exactly what i'd love to go after. I agree, SFH can be found for decent prices in areas around me, but the market is super competitive right now, which has pushed me out of my original idea of wholesaling to build capital for a down payment. Multiplexes are pretty hard to come by around here, and if you do find them they're usually way over market value and the numbers don't make sense. Do you suggest finding properties on or off market to househack?

Daniel Haberkost

Rental Property Investor · Colorado Springs, CO · Member since 2018 · 682 posts · 729 votes

6y

Okay so couple of thoughts:

1.) find a lender at one of your local meetups and talk to them about where you are currently and what you’re looking to accomplish. Then they can help give you clear action steps to getting where you want to go. Starting with a credit card you pay off every month is good but why leave it at that? Talk to someone who does this for a living and they can help move in the direction you want quicker.

2.) the more cash you have the easier this will be. Can you take on more projects in your day job to increase your income and save more for when you’re bankable?

3.) If you can’t find a small multi deal you should buy a large single family house and rent out all of the extra rooms. Check around to see if there are a decent amount of single room rentals in your area and talk to people at the real estate club to be sure it’s something that works in your market. Assuming it is, that’s a great first step because managing tenants you see every day is an easier starting point than in a traditional rental.

Feel free to message me anytime,

Dan

2 Reply

Alex Olson

Real Estate Broker · Kansas City Metro · Member since 2015 · 2k+ posts · 1k+ votes

6y

Originally posted by @Account Closed:

I'm 19 years old (born and raised in KCK) and have been wanting to get into real estate/entrepreneurship since I was elementary school! I've finally reached a point in my life where I am able to start, and I've been trying to hit wholesaling/real estate investing hard. I have about $15k saved up and a motivation to make more. Background on me: I restore classic cars / hot rods full time and do real estate in my off time. I have been networking my butt off (attending meet ups, Facebook, contacting other investors from their bandit signs, BP, podcasts etc) and reaching out to entrepreneurs/investors to get an input and see if I could provide any value in exchange for knowledge and experience.

I've been researching a bunch more on House-hacking and different ways to get into real estate. I'm looking in the Bonner springs/De Soto in Kansas for a duplex or triplex. Just trying to figure out the best way to fund my House-hack, then I'll look for a property. While I'm doing that, I'd really like to start wholesaling or even buying/flipping cheap commercial/residential properties as well. Or I might look into starting my own short term rental management business (Air BnB etc) until I get enough capital for fix and flips. Anyone have any suggestions?

I've been attempting to wholesale, but its been pretty inconsistent, and I've been doing it for 10 months with no return, although I've gotten close on multiple occasions. Does anyone have any tips on what I should focus on, or how I can restructure myself in order to fulfill my dream of becoming a successful entrepreneur?

10-20+ years from now I'd like to own and rent 30+ Single family, commercial, and multi family properties. I also want to have a fix and flip business targeting $100,000-$250,000 properties, and high end properties 600k+. Then for my less income producing business, I want to start a performance car shop for my dad and I to work at together. I know its going to take a lot of hard work and planning, but I'm really dedicated to making it happen. Just trying to figure out where to start.

Thanks everyone!

The best advice I can give you (or myself) 19 yr is to get an fha owner occupied loan. You could get something up to $400k with your $15k. It is amazing. Then you buy a duplex or in your case a fourplex and you live in one of the units and rent out the other four. You can talk to local lenders - us bank even, mazuna, cap fed, community america is great.

Then, you already have 4 units. You can do it again in a year (but you move out of your first one and buy another fourplex with with money you saved up). Do this over and over again until you can't stand living next to someone and you will have a large portfolio of rental homes!!

3 Reply

Jonathan Balascsak

Rental Property Investor · Eastern NC · Member since 2020 · 13 posts · 5 votes

6y

I think you're on the right track with the house hacking strategy for a primary residence loan (preferably FHA). Remember that your first deal may not be a home run. I am currently in our first house hack (eastern NC) and its a base hit ( Duplex/ found on MLS/tenant is paying half/ with repairs we are looking at around 100 PURE cash flow per unit) Seems like you have the drive but now its time to hyper focus on the strategy you'd like to do and execute. One you actually get IN the game the opportunities will multiply.

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

@Daniel Haberkost

1) That's all great advice! I will definitely start looking around for lenders and other investors and see what/who they recommend :)

2) I am starting to get more hours at work, but I still feel like it isn't enough. I only spend about 600 bucks a month (bills, food, gas, activities), and I make 1600-2000 a month. Not bad, but I'm also trying to focus on a another strategy to build up capital (like wholesaling etc).

3) That's definitely an option that i'm looking into as well. There have been quite a few homes in my market that are SFHs that were renovated and setup to accommodate a tenant on a different floor.

Since I still currently live with my parents (rent free), should I look into buying a SFH to fix up and rent out instead? The only two concerns I have with that is I don't qualify for a FHA, and will it set me back more than if I househacked a multiplex?

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

@Alex Olson Thank you for your great input!

That sounds like an awesome plan, and that's what I have really been wanting to pursue. I'm going to continue saving everything I can until I find the right property for me, so hopefully I can figure out a way to build up capital on the side by then. Sorry for the newbie question (and also jumping the gun), but typically I want to keep my original FHA loan on the 1st Househack instead of refinancing (or anything similar) to fund the 2nd Househack, correct? I read someone did a few Househacks by refinancing their loans each time to pay for their next Househack, but I wasn't sure if that's the best option out there.

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

@Jonathan Balascsak Thank you for reaching out!!

Thank you for the reassurance, it's good to hear that from someone who is currently going through their first Househack! :) I'm happy to hear it's doing well! Right, not every deal is going to be a slam dunk, especially when it comes to the limited inventory of multifamily homes, so luckily I've learned to not get my hopes up until the numbers are right. If you don't mind me asking, did you just do a FHA loan for yours as well? How much money did you put down yourself?

I can't wait until my opportunities inevitably grow once I get some skin in the game. One of the more frustrating/difficult things about real estate for me as a newbie is the lack of confidence,opportunities, and network with other local real estate investors! But once I get the ball rolling, i'm determined to make those weaknesses into strengths:)

Jonathan Balascsak

Rental Property Investor · Eastern NC · Member since 2020 · 13 posts · 5 votes

6y

No problem bro! that's why we are here!

I am active duty military so I had the opportunity to utilize my VA Loan with nothing down. I actually got a kick back of around 800 once we closed. Once it was all said and done I opted for a higher interest rate (No money down) so I could do some repairs and add value to the property. I am waiting my 6 months of residency requirements then I will IRRRL the property to drop my interest about a percent and a half and get more cash flow. even after the base hit I may be able to sweeten up the deal with the minor rehab and refi.. Its all about having multiple options to be successful.

honestly, there is no way you can be 100% prepared to dive into REI. You will do your first deal, see all the things that went wrong, and fix them for the next. The best thing you can do is build your team, ensure financing, and start making deals! good luck!!!!

Kyle Curtin

Real Estate Agent · Tewksbury, MA · Member since 2020 · 494 posts · 284 votes

6y

Hi !

I love to see another person that shares the drive so well at so young of an age! I am 20 going through pretty much the same thing!

I have heard from people that I have connected with that househacking is the way to go to get into the rei game. The advice that I have been given is to just buy a property you have confidence in when you are ready and do not have analysis paralysis.

If you recognize that the first property will likely not be a rockstar property, but the lessons will be extremely valuable for the rest of your career, I think you are on a phenomenal path!

I would love to chat man send me a message!

Zachary Ray

Investor · Tampa, FL · Member since 2017 · 589 posts · 251 votes

6y

To be that young with the knowledge of house hacking is incredible. I am actually currently house hacking a duplex and this is a great strategy that will put you so far ahead.

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

Hey @Kyle Curtin! Thanks for taking the time to reach out! It's greatly appreciated.

Me too! I love talking to others my age who have similar interests! Although it seems we are few and far between lol!

Most definitely! I'm afraid of analysis paralysis because I don't know if i'm still waiting for the right property or if I have fallen ill to it already and just don't know it haha!

Of course! I don't have crazy expectations but I do want my investment to perform well enough for the Househacking strategy to work.

I'll be in touch soon! Feel free to reach out to me if you ever need anything as well!

OP

Real Estate Agent · Kansas City · Member since 2019 · 30 posts · 21 votes

6y

@Zachary Ray Hey! Thanks for reaching out!

I agree. I'm very fortunate to have come across these REI strategies at my age. Although I come from a average/low middle class family, I am working super hard and saving everything I have while I learn these things so I can change my family's lives in the future!

That's sweet! How's that working out for you? How'd you choose to fund it, and how'd you find the property?

Thanks again Zachary, feel free to reach out if you ever feel the need!

Zachary Ray

Investor · Tampa, FL · Member since 2017 · 589 posts · 251 votes

6y

It's awesome that you just have that kind of drive so early on. You have the right out look needed to be successful. The property is working out very well, I moved a new tenant in on the other side of the duplex and i'm hoping it all works out. I found the property through Zillow actually. You can use an agent's MLS if that is helpful for you. Just always keep your eyes out looking for deals.