Buying First "House-Hacking" Property in Los Angeles.
Hi everyone,
Absolute newbie here wishing I found this resource a few months ago! I was hoping you guys could chime in on my first investment property in LA I'm currently in escrow for, which is also a house-hack (I will be living in one of the units). On paper, does this look decent or should I pull out while I still have a chance?
A little about me:
29 y/o, recently moved back to Los Angeles from Boston. Was initially going to buy a townhome as I no longer want to rent, but felt as a single guy with no major obligations, turning this into an investment oriented approach felt like a better move. I started reading up on owner-occupied or "house-hack" properties and decided to go down that route to build equity in the property while also lowering my own rent so to speak. The problem is, the Los Angeles housing market is very overpriced, so finding a property that was in at least a semi-decent area proved to tough, not to mention the issue of rent control for any property built before 1978. The best rehab projects going for under 500k were in areas I simply wouldn't be comfortable living, such as South Central or Compton. After a few months and a lot of searching, I found a property in the San Fernando valley (Van Nuys) thats move-in ready and my offer was accepted at 60k below asking. Here are the details/terms:
Purchase Price: $635,000
Property Type: Triplex, all units 1+1
Lease Status: 2 units on month-to-month rented at $1100 each (about $100 below market). Third unit delivered vacant
Mortgage, Insurance, Taxes: $2850 (4.25% rate on conventional 30 year)
Down Payment: $150k (Was considering FHA, but since the property price tag is quite high, the monthly MI premiums would have been killer)
Rental Income: $26,400
Based on these numbers, is this a viable option for me? Any words of advice?
Thanks!