Im looking to "house hack" a multi family property in Los Angeles. Most likely using a FHA loan. I gather the maximum number of units I can consider for this strategy is 4. And so a few questions have come up:
1) What is the maximum FHA loan for a multi family property in Los Angeles?
2) What is a good resource for looking (and filtering) for this sort of criteria ( ie number of units and price) I’m not seeing a “number of units” filter feature on my go to - Zillow, Redfin, etc...).
I figure once I know this I can calculate if the rental income will make the deal net positive ;)
Real Estate Agent · Inglewood, CA · Member since 2015 · 294 posts · 150 votes
6y
@Jordan Esterkin the FHA loan limit for a 2 unit is $980k and for a 4 unit property it is $1.4m. 3-4 unit properties have a self sufficiency requirement that many buyers and lenders don't seem to be aware of. 3-4 units require 75% of the actual (if occupied) or market (if vacant) rents to cover the full PITI. With the current price to rent ratios a property would usually need to be vacant, and or have top of the market rents to satisfy this requirement. Properties that do meet this requirement also are high demand because if they can self sustain with 75% of the rents at 3.5% down, it would be a pretty good investment for a 25% down buyer. The last 4 unit we were able to closing using an FHA loan was about 4 years ago ($1.1m) and 2 of the 4 units were vacant, duplexes are plentiful. For the search just have a Realtor set up an MLS search. With an owner occupancy requirement I typically try to ensure the buyers mtg contributions (PITI/water) at or below market rent so you are not in the red when you move. Often the buyer contribution may be a little more than mkt rent but long term the goal is to add value, pay down, refi and drop MI to offset this. Hope this helps.