House hacking in north Long Beach,

1 Reply

Hey Biggerpockets community, my husband and I are first time home buyers in southern California. We are looking for a property for us to do house hacking, as much positive cash flow as possible (in this market), and use as primary residence to reduce our income taxes (combined income 170k+ per year)

We found a house in north Long Beach CA, built in 1930's, asking price $490k. It has remodeled kitchen and bathrooms, everything in good condition, move-in ready, and most importantly a detached suite with the garage. We plan to live in the detached suite and rent out the main house for $2900+ (4 bed 2 bath). We can scrape together the 20% downpay, but it would exhaust almost all our savings, allowing us to lock in the current 4% 30 year mortgage. We could rely on family in case of financial emergency.
For those of you who are familiar with North Long Beach market, would you please give us your opinion regarding this deal? Is it a rare find, one that we should try to lock-in immediately? Or be patient, keep looking and make a purchase later in the year with more financial security? Please advise specially for north Long Beach nearly no appreciation but cash flow seems to work. Thank you!

Doesn't sound like a bad deal, but what is your exit strategy? How long are you going to live behind the house?

Have you considered buying a home that needs repair? Buying a home in good condition destroys your ability to rehab it...

Also, are you familiar with the FHA203K program? Allows you to wrap repair costs into the loan. A bit more complicated, but could be a good fit for your situation. You can always refinance after the required seasoning period to get out of PMI.

If you want to maximize your dollars, consider the "best use" principal. Multi-families are best for renting, SFRs are best for living in.

I think you're on the right track, but I'm not sure this is the best use of your $98K...