Gulf Breeze, FL · Member since 2017 · 11 posts · 0 votes
Hello BP!
For my first investment I am searching for a "house hack" on the Emerald Coast of Florida. I was recently pre-approved for a VA loan in the amount of $424,000. I do not want to spend the whole amount. When I return from deployment I will be working in Illinois for at least two weeks out of each month (I will be returning to the states within the next 3 months). The exact dates I work in Illinois will be up to me. Rehab projects, at this point, are out of the question due to my financing. The decisions I feel I have at this point is 1. House hack a multi family property (ones that do not need work have been to come by) OR 2. House hack a small condo on or close to the beach as a vacation rental while I work in Illinois.
So! I am just looking for any and all input from those with more experience than myself. Thank you in advance!
Specialist · Santa Rosa Beach, FL · Member since 2017 · 21 posts · 19 votes
9y
@Clinton Levi Lindley, I purchased a 3/2 in West Destin, just as @Zach Westerfield mentioned back in 2015. I rented out 2 of the bedrooms to my buddies from 7Grp and it worked out nicely. Now the home is rented full-time to another veteran. I'd recommend the same: find something in that 175-260 range, claim your room, fully vet and screen your tenants/roommates and put the arrangement in writing. Be clear to annotate all expectations in every single regard you can imagine. Things can start great but with unclear expectations, things can go south quick as well. Feel free to reach out and let me know if you have any other questions!
Warner Robins, GA · Member since 2016 · 244 posts · 167 votes
9y
Hey Clinton,
Hope you make it home safe. When it comes to the destin/Walton area, small multifamilies are very hard to come by. Also remember that it will have to qualify for a VA loan, so anything needing extensive work may be out. Also, VA will not qualify for anything in a flood plane, so beach front may be out. Here is my recommendation. Look for a SFR in the destin area, especially the west side where you and find older, more affordable homes. You will be only a few blocks from the water, and in my opinion values seem to be rising there slightly faster than other areas. You could find and older out of date home needing minor repairs for under 300 with some patience. As far as house hacking, there are always young single military members in the area looking to rent a room. I have several friends who do just that. A lot of the young military crowd likes to live in destin because of the attractions.
If you have any questions let me know. I am currently doing the process I just described, with the exception of no roommates.
Warner Robins, GA · Member since 2016 · 244 posts · 167 votes
9y
As an after thought, you might want to look into air bnb if you will be gone a lot. I don't have any experience with it but I feel a SFR in destin would stay pretty booked
Specialist · Santa Rosa Beach, FL · Member since 2017 · 21 posts · 19 votes
9y
@Clinton Levi Lindley, I purchased a 3/2 in West Destin, just as @Zach Westerfield mentioned back in 2015. I rented out 2 of the bedrooms to my buddies from 7Grp and it worked out nicely. Now the home is rented full-time to another veteran. I'd recommend the same: find something in that 175-260 range, claim your room, fully vet and screen your tenants/roommates and put the arrangement in writing. Be clear to annotate all expectations in every single regard you can imagine. Things can start great but with unclear expectations, things can go south quick as well. Feel free to reach out and let me know if you have any other questions!
Real Estate Professional · Destin, FL · Member since 2015 · 16 posts · 8 votes
9y
You need to keep your lender involved with your decision making. The restrictions on VA funding can be challenging. They do specify that you need to occupy the home you use for the VA financing. One of the first rules of Real Estate is that most people do not sell a property when it is in good shape. If it is in great shape it goes for top dollar. Contact me off line for more information, I spent 22 years in the AF and know what TDY's and deployments can be like.
Investor · Fort Walton Beach, FL · Member since 2015 · 568 posts · 966 votes
9y
@Clinton Levi Lindley You've got some great advice here already. Like Zach said there are few multifamily properties around. As for #2, remember that a vacation rental is a completely different strategy and focus vs a long term rental. There will be a lot more turnover, a lot more marketing. In our area vacation rental PMs charge 18-25% PM fees.
The others have suggested buying a SFR and either renting out the rooms or renting out the entire place. I think that's a great way to start house-hacking. It also gives you the flexibility of potentially trying out the vacation rental strategy for maybe one room and seeing how you like that business model, without fully committing to it.
Hey Clinton,
Hope you make it home safe. When it comes to the destin/Walton area, small multifamilies are very hard to come by. Also remember that it will have to qualify for a VA loan, so anything needing extensive work may be out. Also, VA will not qualify for anything in a flood plane, so beach front may be out. Here is my recommendation. Look for a SFR in the destin area, especially the west side where you and find older, more affordable homes. You will be only a few blocks from the water, and in my opinion values seem to be rising there slightly faster than other areas. You could find and older out of date home needing minor repairs for under 300 with some patience. As far as house hacking, there are always young single military members in the area looking to rent a room. I have several friends who do just that. A lot of the young military crowd likes to live in destin because of the attractions.
If you have any questions let me know. I am currently doing the process I just described, with the exception of no roommates.
Thanks Zach! Any recommendations on neighborhoods or specific areas to search in? When you say west are you talking west of Main Street? Or even further
Warner Robins, GA · Member since 2016 · 244 posts · 167 votes
9y
I'm not sure of the exact flood zones, but I'm pretty sure you will have to stay north of 98 if you want to use a VA loan. The good thing about destin is in my opinion you really cant go wrong, there aren't any real bad areas and its pretty small. The hardest part is finding a good property at a decent price. in the under $300K range, you will pretty much be looking west of Walmart, in the ungated communities. This is the older section, thus lower prices.
@Clinton Levi Lindley You've got some great advice here already. Like Zach said there are few multifamily properties around. As for #2, remember that a vacation rental is a completely different strategy and focus vs a long term rental. There will be a lot more turnover, a lot more marketing. In our area vacation rental PMs charge 18-25% PM fees.
The others have suggested buying a SFR and either renting out the rooms or renting out the entire place. I think that's a great way to start house-hacking. It also gives you the flexibility of potentially trying out the vacation rental strategy for maybe one room and seeing how you like that business model, without fully committing to it.
Gulf Breeze, FL · Member since 2017 · 11 posts · 0 votes
9y
I think for now I will go ahead and count out the condo short term option. I have been in consistent contact with my lender and I should be approved for the VA rehab loan but I'm not sure how I would go about getting the estimates to meet that requirement. I have found some more affordable multi family properties in Pensacola. What are thoughts on multi fam in Pcola as opposed to SFR in Destin?
I'm not sure of the exact flood zones, but I'm pretty sure you will have to stay north of 98 if you want to use a VA loan. The good thing about destin is in my opinion you really cant go wrong, there aren't any real bad areas and its pretty small. The hardest part is finding a good property at a decent price. in the under $300K range, you will pretty much be looking west of Walmart, in the ungated communities. This is the older section, thus lower prices.
Awesome. What could I expect for rent for a bedroom in an older house lets say 3/2 in that area? I am worried about my monthly costs because with 0 down my mortgage will be the full purchase price.
Warner Robins, GA · Member since 2016 · 244 posts · 167 votes
9y
I can only guess at that since I haven't rented out a property there yet, but anywhere from $1800-$2400 depending on the property. With a nice, newly renovated property I think you can get toward the top of that range, but if anyone has better information ive been trying to determine that myself.
Real Estate Professional · Destin, FL · Member since 2015 · 16 posts · 8 votes
9y
Who is your target renter? Consider their income levels? Destin has a mix of long and short term renters. It is really dependent on the area, etc, etc. I can share some information but please contact me so I can narrow down your focus.