Livermore, CA · Member since 2016 · 5 posts · 1 vote
BP,
I need some advice and I'm going to keep this short. I'm planning to use my VA Loan to purchase my first investment property which will be a SFH. Initially, I wanted to purchase a multifamily but they're too expensive here in the Bay Area. MFH have to be almost perfect to qualify for the VA Loan and the ones that qualify exceed what I'm actually qualified for. I also have zero connections here in the area to go into a MFH deal with. Therefore, I've decided to go the SFH route to launch my REI career. My plan is to purchase a 3 or 4 bedroom, 2.5 bathroom house, live in it for a year while renting out the other 2 of 3 rooms. Today my agent sent me some properties to look at in the Antioch and Brentwood area. I know with the BART opening up in Antioch at some point next year more people may want to live in Antioch or Brentwood and property value may rise. Any words of wisdom would be appreciated? Is this a good plan? Is Antioch or Brentwood a decent market for rentals? How can I tell if I'm in a good market? How do I know if I'm getting a good deal on my property?
Rockford, IL · Member since 2016 · 2 posts · 0 votes
9y
Generally speaking, using a VA loan for the purchase of an investment property is not a great idea. The VA requires the property to be at or near move-in ready before they will guarantee the loan. Properties like that typically sell at market value, making it hard for you to get a great deal. If you're patient and willing to do a lot of research, you might be able to find a motivated seller and get something below MV, but they'll be pretty rare.
To get a better idea of what the MV is for the neighborhood you are looking at, have your realtor run some comps for the bedrooms and square footage you're looking for. Using zillow or other apps can be costly if they aren't 100% accurate, which they usually arnt.
Just be patient looking for a good deal and keep in mind that ALL realtors are SELLERS agents, even if they call themselves buyer agents. They are getting paid by the seller to put you in a house. Don't get pushed into a deal if the numbers are not going to work.