New Investor Looking for Advice and Referrals
Hello, my name is Nikki and I'm looking to purchase my first multi-family home (duplex, triplex, or quadplex) in this area (Norfolk, VA Beach, Hampton, Newport News, Portsmouth). Ultimately I'd like to use it as short-term lease rental property, however I'm looking for property that could generate positive cash flow, even if I do the rental as a regular one-year lease. I'm retired military and would be using my VA loan and I already have one single family home on a VA loan. I'm looking for deals on class B/C properties that may require a little cosmetic rehabs, but nothing that requires a crazy amount of work. I'd appreciate any advice from real estate agents, property managers and investors who have experience with short term rentals and multi family properties in this area. I'd also be interested in any referrals for general contractors who have done rehab projects in this area. I appreciate your assistance!
Welcome from Michigan!
Thanks Darryl!
@Nikki Ford welcome to the world of real estate investing!
You mentioned being interested in running the property as an STR...What makes you want to get into STRs (as opposed to the many other investment strategies)?
Have you studied up on the current market dynamics for STRs? Specifically, we're seeing significant increases in vacancy caused by an over-abundance of supply, and rapidly decreasing demand as we head into recession (vacation STR markets tend to get hit hardest in recession because recreational travel is of the first things people cut out of their budget during an economic downturn)...I don't know if this is occurring in your market specifically, but it is likely to occur in many STR markets...
...Also, if you haven't already, I'd suggest reading up on Air BnB's recent platform changes (they now focus on top-tier, highly unique properties--think: luxury beach front treehouses). As a result, lower grade, less unique, more "average" properties are suffering on their platform.
Not saying you shouldn't go for an STR, I'm just saying it's a tricky and risky market to break into right now, and there are much easier, less risky strategies for beginning investors (such as house hacking, or running your multifam property as a LTR).
Good luck out there!
Hello Nikki! I would say that investing in multifamily real estate will prove to be a unique experience when compared to building a portfolio of single-family properties. Keep these tips in mind before you invest in multifamily real estate:
- Find Your 50%
- Calculate Your Cash Flow
- Figure Out Your Cap Rate
- Hope this helps you! Good luck on your future endeavours!
Thank you for the advice Leo Ray! I feel that the demand for STR is high in Norfolk/VA Beach area for traveling nurses and military. I'm considering month-to-month leases for those that are transitioning (such as incoming or outgoing military) who need a temporary home until they find a permanent home to rent or buy. As for traveling nurses, there's an online platform I can market my property for nurses who are looking for an affordable property to lease for a few months. We have a huge medical community here. I did hear about the complications with AirBnB with higher standards. Plus, some of the city codes have limitations on AirBnB properties…I think VA Beach is one of those cities. But I would still look at some opportunities in the cities that have more relaxed rules. Ultimately, I'm looking for property that will cash flow significantly even if I use them for one year leases, because with the changing economy and politics in different cities, I want to be flexible in how I use my property. But thanks again for your advice, and I'll continue to keep these things in mind. I'm not a major risk taker, so I'm doing as much research and analyzing as I can do I'll hopefully make the best decisions.
Thank you John Mathew!
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Hey Nikki- great that you are looking into your first multifamily!
I am not too far away in Blacksburg and know the area well. Would love to connect and help out where I can!
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#2 Managing Your Property Contributor
- Property Manager
- Royal Oak, MI
You may have an issue qualifying for a VA loan for a 2-4 unit without 12 month leases. Don't think VA underwriter will allow STR rental income to qualify for the loan.
Hey Nikki, I'm glad you're considering buying your first multifamily!
Feel free to reach out if you have any questions.
https://calendly.com/d/g2t-b88...
Good luck!
Rey
Hi Nikki! How are you this morning? Are you still looking to invest in a property in this area?
Hello, How you doing Nikki. I'm close to being in the same boat as you. I am in the Hampton Roads area and looking to get into STRs for the same reasons you have mentioned earlier. I agree with you 100% between traveling nurses and military needs there's definitely an opportunity. In regards to the VA loan I believe you could still get the2-4 family homes it just has to be owner occupied for the 1st year. I am also interested in single family flips as well. But at the moment I am looking to convert my garage into an ADU and use that as a STR. Hope this helped, and look forward to crossing paths with you someday. Keep asking question and ill do the same!!
Welcome to BP!
Congrats on stepping out and wanting to grow your portfolio for long-term wealth!
I wish you all the best!
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Hi @Nikki Ford! I am a local RE professional in the area and could be a connector for you with some local professionals that could assist. Feel free to reach out and connect :)
Hey Nikki with regard to STR, I would look into the legislation around STR in whatever area you are interested in. That may lead to you narrowing down a particular city. Some of the restrictions can be quite difficult to work around!