Saving for the Next Property - Where to Put the Money?

3 Replies

Hey Everyone!

I’m currently stashing as much of my income as possible in order to come up with a down payment for my second investment property which, like my first one, will likely be a house hack. 

So my question is this: Where should I put those savings in the meantime? Particularly which investment buckets, not which financial institutions. I’m a big believer in the long term success of total stock market index funds but understand that poses risk in the short term; though I also have a hard time stockpiling cash in a traditional savings account knowing that money isn’t working for me.

I technically have the funds for an FHA loan or small conventional already but I won't be eligible for another owner occupant loan until 2021 and would like to put more down anyways so I've set my timeline for six months - one year.

Any and all feedback would be greatly appreciated. Thanks in advance!

@Tripp Smith

When did you first do your owner occupied house hack? Most banks allow you to purchase your next one 9 months out since you need to have an “intent to occupy the property within 90 days for owner occupied loans”. Just a food for thought just in case it’s only a few months away then you wouldn’t even need to put it elsewhere.

In regards to investing I would recommend using it to improve your current property and equity position there until you can purchase a new property.

You also can buy a second home with a 10% down loan.

@Marc Rice

Hi Marc. I got into my current house hack in December 2019, so right at 9 months ago. I was under the impression I needed to live in this house for a full year before starting the process on a second owner occupant loan so I'll need to look into that further with my lender and perhaps shop around.

Thanks for the input! 

@Tripp Smith

Yeah I’d start looking for your next house hack. It’ll take at least 30 days to close on it and probably another 30-60 to even find the deal. Skip the casino (aka stock market) and keep growing that rental portfolio!