If you were in my shoes what route would you do?

7 Replies

Hello All, 

I have been off this board for a while, i been out of investing for a little over 2 years for various reasons (career changes, and divorce) and i feel like i am in a good place financially to invest again, so i wanted to get some opinions.

4 years ago i got out of the Military and became a Realtor, i worked as a Realtor for a while, but i never really made decent money and worked my butt off, i barely managed 25k/yr, so i decided to make a change to my life and went back to school and now i am a Registered Nurse after going through a fast track education program. After getting my licenses as a Nurse my pay is stable and i should easily clear 55k this year based on the hours and pay i am currently being payed at my hospital job. 

Based on my income + about 70k in savings from selling non-performing properties i have been debating a few ways of going...

I have been keeping an eye on MLS listings since i still hold my real estate license for the past few months and Craigslist for cash deals, but i feel the prices are just terrible right now on your typical 3/2 rental properties...

Option 1: Should i keep looking for 3/2, 4/2+ under 150k deals for rentals in hopes of something popping up?

Option 2: I have been finding more deals on the more expensive houses in the 250K+ range, i have crunched numbers on a handful of houses in this range come across a good number that have showed positive passive profits in the $200+/month range, but im concerned on these taking up to much of my active income. Most of the houses i sold that were not really performing as rentals were in this range, so i have a bad history with rentals in this price range. 

Option 3: Currently i am renting out a room with family, because i was trying to reduce cost while i was in nursing school, The amount im being charged is very minimal compared to renting something these days, so i feel blessed, but i have thought about house hacking as option 3, purchase something on the larger side like 3,4,5 bedrooms and rent out 1 or 2 of the rooms. I have never done house hacking before since i married most of my life, so unsure how well this would work out, currently im single so no more wife issues on this one. 

Option 4: Should i just hold off right now as it seems the market is thin on houses and pricing is to high?

House Hack!!!! I would love to do that where I'm at in Ventura County, but finding a multifamily in a decent area is hard to find. I'm living at home for free while I go to school using my GI Bill. 

Semper Fi

Originally posted by @William Huston :

Hello All, 

I have been off this board for a while, i been out of investing for a little over 2 years for various reasons (career changes, and divorce) and i feel like i am in a good place financially to invest again, so i wanted to get some opinions.

4 years ago i got out of the Military and became a Realtor, i worked as a Realtor for a while, but i never really made decent money and worked my butt off, i barely managed 25k/yr, so i decided to make a change to my life and went back to school and now i am a Registered Nurse after going through a fast track education program. After getting my licenses as a Nurse my pay is stable and i should easily clear 55k this year based on the hours and pay i am currently being payed at my hospital job. 

Based on my income + about 70k in savings from selling non-performing properties i have been debating a few ways of going...

I have been keeping an eye on MLS listings since i still hold my real estate license for the past few months and Craigslist for cash deals, but i feel the prices are just terrible right now on your typical 3/2 rental properties...

Option 1: Should i keep looking for 3/2, 4/2+ under 150k deals for rentals in hopes of something popping up?

Option 2: I have been finding more deals on the more expensive houses in the 250K+ range, i have crunched numbers on a handful of houses in this range come across a good number that have showed positive passive profits in the $200+/month range, but im concerned on these taking up to much of my active income. Most of the houses i sold that were not really performing as rentals were in this range, so i have a bad history with rentals in this price range. 

Option 3: Currently i am renting out a room with family, because i was trying to reduce cost while i was in nursing school, The amount im being charged is very minimal compared to renting something these days, so i feel blessed, but i have thought about house hacking as option 3, purchase something on the larger side like 3,4,5 bedrooms and rent out 1 or 2 of the rooms. I have never done house hacking before since i married most of my life, so unsure how well this would work out, currently im single so no more wife issues on this one. 

Option 4: Should i just hold off right now as it seems the market is thin on houses and pricing is to high?

Definitely house hack using your VA entitlement.

Originally posted by @Stephanie P. :
Originally posted by @William Huston:

Hello All, 

I have been off this board for a while, i been out of investing for a little over 2 years for various reasons (career changes, and divorce) and i feel like i am in a good place financially to invest again, so i wanted to get some opinions.

4 years ago i got out of the Military and became a Realtor, i worked as a Realtor for a while, but i never really made decent money and worked my butt off, i barely managed 25k/yr, so i decided to make a change to my life and went back to school and now i am a Registered Nurse after going through a fast track education program. After getting my licenses as a Nurse my pay is stable and i should easily clear 55k this year based on the hours and pay i am currently being payed at my hospital job. 

Based on my income + about 70k in savings from selling non-performing properties i have been debating a few ways of going...

I have been keeping an eye on MLS listings since i still hold my real estate license for the past few months and Craigslist for cash deals, but i feel the prices are just terrible right now on your typical 3/2 rental properties...

Option 1: Should i keep looking for 3/2, 4/2+ under 150k deals for rentals in hopes of something popping up?

Option 2: I have been finding more deals on the more expensive houses in the 250K+ range, i have crunched numbers on a handful of houses in this range come across a good number that have showed positive passive profits in the $200+/month range, but im concerned on these taking up to much of my active income. Most of the houses i sold that were not really performing as rentals were in this range, so i have a bad history with rentals in this price range. 

Option 3: Currently i am renting out a room with family, because i was trying to reduce cost while i was in nursing school, The amount im being charged is very minimal compared to renting something these days, so i feel blessed, but i have thought about house hacking as option 3, purchase something on the larger side like 3,4,5 bedrooms and rent out 1 or 2 of the rooms. I have never done house hacking before since i married most of my life, so unsure how well this would work out, currently im single so no more wife issues on this one. 

Option 4: Should i just hold off right now as it seems the market is thin on houses and pricing is to high?

Definitely house hack using your VA entitlement.

@Stephanie Potter

Can you elaborate a little on why you added VA entitlement to the statement, are you talking about the 0% down part or is there something else that i may not know about.

When building your real estate empire you should take advantage of every product or program that keeps money in your pocket because cash is king. Your VA entitlement is like gold. You can purchase a multi family home with your entitlement, live in one and rent out the others with 100% financing.

That should be your preferred method of financing for the least amount of money out of pocket.  

You could also purchase a multi family property using an FHA 203K, renovate it to your liking and bring an older property (one that eventually will become an investment property ) up to date, saving you out of pocket cash . After you do that, live in it for a while and then do the same with your VA entitlement increasing your number of doors.

Opinion:  after you get your personal living situation squared away (I agree with @Jonathan Jamie velarde and @Stephanie P. to use your VA loan guarantee for your own home or house hack).

But the question you raise about high prices you find on MLS is interesting and raises another related question: don't you think that other investors feel the same way? So they just pass the deals by, right?

Why?  Perhaps they are asking the wrong question.  Perhaps they should be asking themselves, "how many offers should I be making on the properties I have even slight interest in"?

This is a numbers game. If you don't believe there are juicy deals to be had on MLS and/or Craigs list or any other media, I'd say it's just (currently) your lack of experience. They are there, but it takes some work and hustle.

You are a licensee...  make your low offers subject to inspection.  Disclose you are a realtor purchasing for your own account.  Especially go after expired--either to list or to buy!

You'll never purchase a bargain if you don't make an offer.  Just food for thought.

Good luck, and thank you for your service to our country!

How about leverage VA entitlement to purchase a fourplex with low money down and rent out the other 3 units? This way you wouldn't need to share living space with your tenants and you'd generate more income. Good luck!

You already know option 2 is bad. The others are all about the profit. Get the deal that makes money. A house hack is great, but don't rush into a bad deal if you have flexibility where you are.