How can I buy a rental with less than $10,000?

Question

Hello everyone!

I recently graduated from a 4 year university and moved down to Miami, FL for work. I have family here and have been blessed to live rent free here in Miami. However, I really want to get into Real Estate Investing and I am currently undecided about what should be my next step.

I’ve thought about house hacking and getting a FHA loan, but the market here in Miami is very unfavorable. I considered at least moving up North for a year (Ft. Lauderdale area) to purchase a multi family home that would produce cash flow while I stayed there for a year.

Do you think this is possible in the Ft. Lauderdale or even in the Miami area, and if not, what would be the next best thing to do with little money down?

Timothy Lewis · Answer

@Nathan G. hit it right on the head! I too recommend that path. Especially in the Ft. Lauderdale area due to the quality and price of multi-family units compared to Dade County.

Nathan Gesner · Answer

You can purchase a multi-family property with up to four units using an FHA loan. Occupy one unit, rent the others out. I recommend reading Craig Curelop's book on House Hacking or Scott Trench Set For Life. They both explain this process.

Malgorzata Sadowska · Answer

seller financing, although might need to save more for downpayment (or use gift money) or have a cosigner.

Kevin Kohler · Answer

Hi @Eduardo Conde - I am currently helping several clients right now with that specific purpose for house hacking in SFL. Would love to chat with you about it and which area best suits you.

Charlotte Chew · Answer

I bought a SF and turned the garage into an STR. It's been doing great here in TX but youd have to check regulations for STRs in your area to see if it's worth it. Since I forced some appreciation by adding a bedroom & bathroom, it appraised for $60k more than what I bought it for. I did a cash out refi and am under contract for house#3 that has an ADU that I can use as another STR. Maybe some of those strategies could help in your case? I'd be happy to provide more info if you want it. Good luck!

Stephen Keighery · Answer

@Eduardo Conde learn how to buy subject to the existing mortgage. This is a powerful strategy to build a rental portfolio.

Lina Bibikov · Answer

@Eduardo Conde I would buy a SFH and rent out by bedroom, especially since multi family is probably hard to find.

Eduardo Conde · Answer

@Lina Bibikov never considered that. I’m just not certain if it would make sense to put down as little as 3.5% down on a $600,000+ multifamily property. I feel as though the mortgage plus all other expenses would be too high to offset the gross income. Mainly because I am loaning out so much. And the reason I say $600,000 is because that’s probably what I’ll be able to find here in Miami, if not more.

Patrick McCauley · Answer

@Eduardo Conde I agree with Lina. I would consider looking at SFH and try a rent by the room househack. My next suggestion would be to stay with your current situation as you can minimize your expenses and accelerate your savings

Lina Bibikov · Answer

@Eduardo Conde What if you did house hacking by the bedroom?

How can I buy a rental with less than $10,000?

How can I buy a rental with less than $10,000?

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