Househacking Multi-family Home with VA Loan in NYC

Multi-Family and Apartment Investing
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Househacking Multi-family Home with VA Loan in NYC

Paul J Perez
Astoria, NY · Member since 2019 · 6 posts · 8 votes

I live in NYC and I'm looking to house hack my first multi-family home with a 0% VA Loan this year. I'm not sure if it's feasible in NYC and would appreciate any advice and suggestions from others that were in a similar situation.

I'm currently renting a 2BR for $2000. Out of curiousity I applied for and was pre-approved for a $400K $0 Down VA Loan, though I can probably get more (the current NYC limit is $726k). I'm just worried about taking out such a large loan and having a huge mortgage payment. My income is $150k and I have approx. $40k in liquid assets. After taxes, child support and maxing out 401k contributions I bring home $5250 per month.

I've been looking on [realtor.com](https://realtor.com) and [zillow.com](https://zillow.com) and I'm running into a few problems. In Nassau County, homes close to my price range have huge tax expenses, so I wouldn't be cash flowing. Homes in Brooklyn/Queens/Bronx close to my price range are usually listed as short-sales and may not meet the VA's Minimum Property Requirements, so going for a fixer-upper may not be possible.

So unless I can figure out how to find a multi-family home with low taxes and in decent condition, it doesn't seem like house-hacking will be an option for me and I'll need to go with a traditional loan. I can't move to another market because I need to be close to my kids' school and work.

Does anyone have any suggestions for me on whether I'm on the right path and on finding leads?

Also, I ran a BRRRR Calculator on a property but I'm pretty sure I did it wrong. Here's the link if anyone would like to help me figure out what I entered incorrectly.

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Jerry Cima
Putnam County, NY · Member since 2019 · 25 posts · 5 votes
7y

@Paul J Perez it seems like your biggest issue is finding the right property (getting a deal). You may want to reach out to a RE agent, give them your requirements and see what they can find. Also, you should research a bit on lead generation. Maybe you can do a mailing, post a listing on Craigslist, look on Craigslist for `rooms for rent` find the owner and see if they are interested In selling. Post on FB, etc. Good luck, make sure to post if you find something.

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  • Jerry Cima
    Putnam County, NY · Member since 2019 · 25 posts · 5 votes
    7y

    @Paul J Perez it seems like your biggest issue is finding the right property (getting a deal). You may want to reach out to a RE agent, give them your requirements and see what they can find. Also, you should research a bit on lead generation. Maybe you can do a mailing, post a listing on Craigslist, look on Craigslist for `rooms for rent` find the owner and see if they are interested In selling. Post on FB, etc. Good luck, make sure to post if you find something.

    1Reply
  • Anthony Dooley
    Investor · Columbus, GA · Member since 2014 · 2k+ posts · 1k+ votes
    7y

    Knowing what I know and having lived in several states, including NY, I would never buy there.

    0Reply
  • Jerry Padilla
    Lender · Rochester, NY · Member since 2014 · 3k+ posts · 1k+ votes
    7y

    @Paul J Perez

    It sounds like a VA Renovation Loan may be a good fit for you! If you are considering a SFR. I am not sure if a MFR will work with $400k. With VA, you need 2 years experience to consider rental income towards getting pre-approved.

    Quick Overview;

    Va Renovation Is available on SFR, PUDs and VA approved Condo's. You can make repairs or improvements up to 35% of the "As Completed" value of the property. The improvements must be permanently affixed to the property, and add value.

    0Reply
  • Amy L.
    New York, NY · Member since 2013 · 11 posts · 2 votes
    6y

    @Paul J Perez

    Hi Paul, I’m also in the same boat. Any updates since your post?

    1Reply
  • Suzanne PlayerPro Member
    Attorney · New York City / Long Island, NY · Member since 2020 · 597 posts · 248 votes
    5y

    It looks like you're trying very hard to make the deal fit the loan, not the other way around.  Check out the SONYMA programs:  https://hcr.ny.gov/sonyma-prog...

    Also, know what you can buy with a conventional loan.  But buying with nothing down - at NY prices - can be very difficult.  It's not the worst thing in the world to use a down payment.  If you have a lower payment it can help you get the mortgage for your second property (if & when you buy again), because banks don't want you to be overleveraged.  

    Have you asked your CPA if you could forego making a contribution to your 401k to accumulate extra cash for this purchase? Could you continue contributions later after an interruption? Could you contribute to an IRA in the meantime to use later as a self-directed IRA for purchasing other properties? This would change your tax situation and I can't give you tax or legal advice, just throwing out ideas.

    With the self-directed IRA, you can't use it to buy certain properties like your own residence or a vacation home. There are other strict requirements this entails. But it may be useful to you later on.

    516-503-7959
    0Reply
  • Raphael Abreu
    Real Estate Agent · Miami, FL · Member since 2019 · 36 posts · 25 votes
    5y

    Hey Paul! I've noticed that certain areas in Long Island have crazy high taxes.  Better price to rent ratios, but very high taxes. I recently made a post where I talked about house hacking in an expensive market which you should totally check out!  I'll be sending you a dm!

    0Reply
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