I'm in the process of buying my first property and I'm looking for some advice or a little help from the BiggerPockets family.
I'm using my VA loan and I'm looking to use this as an investment but at the same time this would be my primary residence, for now at least. I'm looking for a 3 bedroom house/condo/apartment. My brother and I are moving and bringing a friend with us. They would pay rent of course and that'll allow me to save some money for my next investment. My thing is, I'm buying a house in Orange County and as many of you know, it's an expensive market. With using the VA loan and looking at my situation, with your experience or with your knowledge, what kind of property should I be looking for? what would be the best option for a smart investment?
Right now, I'm looking for a property that can allow me to do some rehab but with the VA loan it can't be anything too crazy. I know when buying property I shouldn't rely to gain value through appreciation. Would it be smart to buy something already in good condition that doesn't really need rehab or should I still look for properties with some rehab work in Orange County. I have about 10-15k to start so I don't have a ton of money but I do have some and I know it's more than enough to start.
I appreciate this site and everybody who helps others make their dreams a reality and I'm looking to be one of those people. Thank you BP!
It's always best to buy the ugliest house in the neighborhood. Given that dirt is the expensive part for Orange County, I'd look for a single family house or something as close to the beach or in the best school district you can find. All are good inherent value for the purposes of resale. I'd also make sure I knew rents for rooms wherever you plan to buy and your friend's budget. If he can't help pay more than 1/3rd of the mortgage, that place isn't worth it.
Feel free to reach out if you have any other questions or concerns!!!
@Felipe Salgado , look for properties that have things like outdated kitchen cabinets, outdated bathroom vanities, ugly flooring. These won't be major rehabs but will allow you to force some appreciation. I saw you mentioned a condo. I would recommend you really look into the pros and cons of buying an HOA property. I personally don't even give them a chance because I don't agree with allowing a random group of people who have 0% stake in my property tell me what I can and can't do with my property. They can also have "special assessments" and then you'll be required to throw up thousands of dollars. If you still want to consider an HOA property, check out BP podcast #244 with Linda Weygant. She owns a bunch of HOA properties but she also sits on the board of every HOA so she can control it to her advantage.
I just bought a house in Oxnard with my VA loan so I understand you when you say it's an expensive market. Meeting great numbers is going to be somewhat difficult as well since it's 0% down but you'll find something that will work.
As @Amanda Fallon recommended, also consider an FHA 203k loan. The strategy she outlined is a great one and is one that I am using. Buy a property with my 0% down VA loan and house hack it for a year then buy another property with a 3.5% down VA loan and house hack it again. The money you will save house hacking, depending on your income, will even open the doors for you to invest out of state. I am currently in Norfolk, Virginia on a work trip and researching the local market. Home values are so low that I could easily save up a 20% down payment for a property here within one year.
Good luck on your search!
Hi @Amanda Fallon ,
Thank you! Okay thanks for mentioning that. Around the price I'm looking for that actually might be possible and a better option. I will do more research on that and see how I can manage to use that. I want to make sure I pick a smart investment that can help me leverage a second investment.
Thank you! I agree 100% percent. I'm going to check out that podcast but you bring up great points and it'll help me take a better look at my options. I'm going to look for SFR instead of a property with an HOA. I know that a lot owners pay the fee and see nothing from it. I'm looking more into the FHA 203k loan now that you both bring it up and I really feel like that would work a little better even if I have to put 3.5% down. That's manageable and I know it can help with the remodel as well.
My goal is to buy out of state and this first home will be short term. Once I move into my first home I will work to buy out of state and exactly for that reason, it's a lot cheaper and saving that 20% down payment would be easier also. I really appreciate you taking time to reply, I'm learning and growing but if you need a Veterans help, I'm more than happy to lend a hand or just listen and learn. Thanks again!
Good luck out in Virginia! hope you find a great deal out there!
A fellow veteran.
@Account Closed 15k is very possible to get into the CA market. I'm only 4k in on the house I just bought with my 0% down loan. That includes closing costs and inspections.
Hi @Kevin Phu
I am a newbie as well, please help! For what I know of, CA market is very competitive and expensive, especially OC area. How could we get into it with a limited amount of money and for what you paid out, it was incredible. Would you provide me your lender information. One more thing, did you use any down payment assistance programs or tax credit certificate (MCC) along with your VA loan for first time homebuyer?