First Step in Buying a Rental Property! (Military Edition)

Buying & Selling Real Estate
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First Step in Buying a Rental Property! (Military Edition)

Jimmy Chung
Member since 2022 · 1 post · 2 votes

Hi, I'm a soon to be graduate from the United States Military Academy, and have my "Post Night" next week. This is where we choose the duty station we will be heading to. I have narrowed down my options to either Texas or Kansas, and wanted to get on the market to begin my real estate journey as soon as I got my post selection (no real estate experience besides reading books and listening to podcasts). My ideal plan was to buy out a multi-family home (duplex, triplex, or fourplex), and do a house-hack. I have started my searches in the neighboring towns of the post itself and I've been having a VERY tough time finding a single multi-family rental in either location. This has made choosing between the two duty stations difficult, so I wanted to get on the BiggerPockets forums to reach out for help in regards to a direction to head and advice in general.

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Jason Howell
Rental Property Investor · Fort Worth, TX · Member since 2021 · 48 posts · 40 votes
4y

I really like your strategy. House hacking small multi-family is a great way to get started in real estate. However, I don't know if choosing your duty station based on the local real estate market is the best idea. I never served in the military, but I think I'd want to choose a duty station based on advancement opportunities and then build a real estate portfolio on the side. I'd suggest once you get to your duty station take some time to study the market, build your network (attend local REI meetings, talk to lenders and realtors, etc.), and save some extra money. Good luck and thank you for your service!

Btw, Kansas is a good size market and Texas is a huge market. If you need more detailed help, you might want to list exactly where in those states you are looking.

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  • Kerry BairdPro Member
    Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
    4y

    Congratulations!  The hard work will be paying off, and in spades!  I'm sure you are looking for your housing allowance, and checking to see what you will be paying for monthly.  You can also check your own FICO at myFico.com and start to clean up any errors. 

    I've bought in a few markets in Texas, we were stationed in San Angelo, and I have had properties there, in Fort Worth and recently renovated and sold a house in San Marcos.  There are things to watch out in the local area that will work much better with an experienced agent...so wait until you get there.  For example, Ft Worth has some odd soil settling in some parts of the city that is really common, and we had to mud-jack a house foundation.  It sure is nice to recognize what that looks like.  San Marcos has sweet water on one side of town and foul water on the other, so the houses with sweet water are more in demand. 

    1Reply
  • Jason Howell
    Rental Property Investor · Fort Worth, TX · Member since 2021 · 48 posts · 40 votes
    4y

    I really like your strategy. House hacking small multi-family is a great way to get started in real estate. However, I don't know if choosing your duty station based on the local real estate market is the best idea. I never served in the military, but I think I'd want to choose a duty station based on advancement opportunities and then build a real estate portfolio on the side. I'd suggest once you get to your duty station take some time to study the market, build your network (attend local REI meetings, talk to lenders and realtors, etc.), and save some extra money. Good luck and thank you for your service!

    Btw, Kansas is a good size market and Texas is a huge market. If you need more detailed help, you might want to list exactly where in those states you are looking.

    3Reply
  • David Bain
    Agent · Honolulu, HI · Member since 2017 · 97 posts · 48 votes
    4y
    Originally posted by @Jimmy Chung:

    Hi, I'm a soon to be graduate from the United States Military Academy, and have my "Post Night" next week. This is where we choose the duty station we will be heading to. I have narrowed down my options to either Texas or Kansas, and wanted to get on the market to begin my real estate journey as soon as I got my post selection (no real estate experience besides reading books and listening to podcasts). My ideal plan was to buy out a multi-family home (duplex, triplex, or fourplex), and do a house-hack. I have started my searches in the neighboring towns of the post itself and I've been having a VERY tough time finding a single multi-family rental in either location. This has made choosing between the two duty stations difficult, so I wanted to get on the BiggerPockets forums to reach out for help in regards to a direction to head and advice in general.

     Congrats brother!  Always love to see others in uniform making major moves in RE.  I'd love to connect more soon.  I've got friends in the industry around the nation (especially near duty stations) that can take care of you before and upon arrival. 

    0Reply
  • David Bain
    Agent · Honolulu, HI · Member since 2017 · 97 posts · 48 votes
    4y
    Originally posted by @Jason Howell:

    I really like your strategy. House hacking small multi-family is a great way to get started in real estate. However, I don't know if choosing your duty station based on the local real estate market is the best idea. I never served in the military, but I think I'd want to choose a duty station based on advancement opportunities and then build a real estate portfolio on the side. I'd suggest once you get to your duty station take some time to study the market, build your network (attend local REI meetings, talk to lenders and realtors, etc.), and save some extra money. Good luck and thank you for your service!

    Btw, Kansas is a good size market and Texas is a huge market. If you need more detailed help, you might want to list exactly where in those states you are looking.

    Based on availability and "needs of army" I agree to find a location with a strong market to take advantage of while serving.  I did this in Hawaii and the rest of the story is pretty self explanatory.  Life changing strategy!  

    0Reply
  • Kayla Givens
    Lender · Denver, CO · Member since 2021 · 244 posts · 253 votes
    4y

    Hey @Jimmy Chung! If you're having issues finding multifamily properties in those markets, you can still house hack in a single-family home! There are a few ways to go about it:

    • Find a house in your price range with as many rooms as possible and rent out all the rooms
    • Repeat option one but find a house that could be converted into two units - you occupy one unit and rent out the other unit

    If you can find a house to convert into two units, you might want to look into the short-term rental rules in your area to increase your cashflow even more :) 

    1Reply
  • Doug Spence
    Investor · San Diego, CA · Member since 2016 · 1k+ posts · 975 votes
    4y

    @Jimmy Chung You aren't going to find a smoking hot deal on the MLS these days. The good thing his, if you're house hacking with your VA loan, you don't really need a smoking deal - just a first property to get your foot in the door. If the other units can pay for some or all of your living expense then I would consider it a big win - especially at your age!

    Will you have your full VA entitlement as soon as you leave west point?

    My wife and I just did a VA loan house hack in San Diego, so I'm happy to chat more with you about that if you want.

    Best of luck and keep us updated on your journey!

    0Reply
  • Chace Fraser
    Realtor · Portland, OR · Member since 2017 · 357 posts · 259 votes
    4y

    Hey @Jimmy Chung, first of all, thank you for your service (you too, @David Bain and @Doug Spence)!

    I think the advice from both @Jason Howell and @Kayla Givens is really good. 

    For your first house hack, start simple and go from there. Find a nice, pretty property that is in great shape and make sure the numbers work... as Kayla said you may have to go SFR to start. There are plenty of houses out there right now that can potentially work for you.

    Finding a property that pays you to live there, or with a mother-in-law suite and an ADU, will also come with a unicorn on it! Don't try to hit a grandslam. Get a good first property and then move on. Don't try to hit a home run with a rundown pile of junk that might make you some money or might sink you. Most of my clients have base hits properties. Base hits add up in the long run to an amazing portfolio.

    1Reply
  • David Bain
    Agent · Honolulu, HI · Member since 2017 · 97 posts · 48 votes
    4y
    Originally posted by @Chace Fraser:

    Hey @Jimmy Chung, first of all, thank you for your service (you too, @David Bain and @Doug Spence)!

    I think the advice from both @Jason Howell and @Kayla Givens is really good. 

    For your first house hack, start simple and go from there. Find a nice, pretty property that is in great shape and make sure the numbers work... as Kayla said you may have to go SFR to start. There are plenty of houses out there right now that can potentially work for you.

    Finding a property that pays you to live there, or with a mother-in-law suite and an ADU, will also come with a unicorn on it! Don't try to hit a grandslam. Get a good first property and then move on. Don't try to hit a home run with a rundown pile of junk that might make you some money or might sink you. Most of my clients have base hits properties. Base hits add up in the long run to an amazing portfolio.

    Much appreciated.  Glad to be in RE full time now!  

    0Reply
  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    4y

    Congratulations & thank you for your service! I would recommend as a new investor to find a new or renovated multifamily to minimize risk

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