Bought my first home in the middle of the depths of Covid

[Shamika Beckley]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $306,000

The power of the VA loan is SO powerful! I wish I would've used this sooner.

What made you interested in investing in this type of deal?

I just returned from Germany and wanted to finally start investing in real estate after years of hesitation.

How did you find this deal and how did you negotiate it?

My agent found this amazing deal and he negotiated the deal for me. It was easier than I thought it would be! The timing just happened to be perfect. The couple had just divorced and had lived in the 2018 build for 2 years and it was around the time I was searching for houses.

How did you finance this deal?

VA home loan with no money down!

How did you add value to the deal?

It happened to be a turnkey home as it was built in 2018. Super lucky first buy!

Lessons learned? Challenges?

I learned that it was "it" neighborhood as it had the best schools, safe, and close proximity to shopping centers, hospitals and the Air Force Base. I talked to friends in the area and got their take on neighborhoods that were more sought after than others and would bring renters in after I left due to it being a large military community with lots of turnovers.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I used a friend, Paul Sinkus who worked for Keller Williams. He did a fantastic job, was responsive and made it easy.

[Wendell Butler]

Quote from @Shamika Beckley:

Quote from @Andrew Freed:

@Shamika Beckley - Wow a property constructed in 2018 for a good price. If you do turn that into a rental, the capex and repair on the property will be minimal a best. What can you get for rents out there? Sounds like a great buy!

I know a few military investors. They usually scoop up a primary house near a military base and when they get stationed elsewhere, rather than selling it, they keep it as a rental and purchase a new property. If they're low on the down payment for the next primary, they just open up a HELOC and use those funds.

In addition, military professionals have a ton going for them from an investor standpoint. They have more tools available to house hack than normal folk. They can utilize a VA and FHA loan for low down payment primary properties meanwhile most regular people can only use FHA. You also have the ability to refinance out of your VA into conventional and reuse it on your next purchase. One of my buddies plans on going back and forth between his VA and FHA loans for house hacks over the next 5-10 years.

 Andrew,

Thank you! So when I had to move out in a short turn, I was able to find a renter in under a month. It turned out to be my old troop and his fiancé who I’ve known for over 10 years who have a renters mindset but wanted to move to a better neighborhood with more space for their now blended family. I was grateful that I didn’t have to go searching for a qualified applicant as they both have very steady well paid jobs and I also don’t need a property manager because he is handy in that aspect should anything happen. I Still of course had them sign a lease etc. 

I KNOW that I'm losing out on CF though as my mortgage, HOA and everything combined is $1533. I charge them $1750 however, with everything going on and seeing what others are renting for near me (someone on the same street is renting for $2200) I want to raise the rent to $2k. I'd like to send them a letter to officially do it but also have a convo with them as well, giving them 60 day notice which would be 25 April. With that being said, do you know where I could find an example letter and the right things to say when raising rent? If not maybe I can shout it out in the BPP large forum or are there examples on this site I don't know about yet?

As for turning the VA to FHA loans, THANK YOU! I was wondering how I would do it after I bought my second property. I just got approved for a second VA home loan and am currently searching for a second here near Patrick Space Force Base. It's been hard. Since I'm renting I was going to use that as a primary residence but didn't know how to go about financing my third. Great, great info and tips!!

That is why VA loans are great! You can use them twice if you have enough VA entitlement left. Where I am it's hard to use it twice though, you are lucky you got such a great deal! I am actually looking around Destin, FL to invest since it is near a military base, plus the Short term rental (STR) scene there is amazing. What @Andrew Freed was explaining that I am planning to do is use my VA loan (currently using for a duplex I am in) then for my next property I will use the FHA loan for a multifamily/future STR/Future rental. Then I will refinance out of my VA loan into a conventional loan, allowing me to use my full entitlement for my VA loan again shortly after. Buy another multifamily/future STR/Future rental with the VA loan again. Then refinance out if the FHA and use that again next. I'm planning to do this until I get sick of moving haha, probably 5 years or so I would say! But it lets you really leverage the loans and increase ROI significantly!