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Ruben Beraza
  • San Francisco Bay Area
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Lets Connect: Searching Multi-Family (4-plex) as 1st Primary Residence in TX

Ruben Beraza
  • San Francisco Bay Area
Posted Sep 17 2023, 11:19

(First Time Home Buyer / House Hacking)

Hello BP Community,

I'm based the Bay Area, Ca & have fix n flip experience in this market. I'm new to the rental side of the RE business & searching for a multi-family, single story 4-plex primary residence in the Texas-San Antonio, Houston, Dallas markets. I plan to leverage an FHA loan to kick off my long term rental portfolio. I'm aiming for a mix of appreciation & positive cash-flow after some value add work is done to the property over the course of first year of ownership. I plan on putting some elbow grease myself but mostly contracting the work out to allow the professionals to do what they do best. I know this may be very difficult in todays market, however it's possible.

In addition, I’m wishing to connect & build relationships with local investor friendly agents in these areas who invest themselves, help clients with investing opportunities & are tapped into off-market listings. If you have experience structuring creative financing deals, all the better. Open to agent recommendations / money lenders as I begin to get my ducks in a row to execute effectively by no later EOY. Much appreciated & thanks in advance! 

Happy to connect via BP / Zoom / IG whichever platform works best to fill in any gaps in my post. 

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Bruce Lynn#2 Real Estate Agent Contributor
  • Real Estate Broker
  • Coppell, TX
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Bruce Lynn#2 Real Estate Agent Contributor
  • Real Estate Broker
  • Coppell, TX
Replied Sep 17 2023, 13:36

Welcome to Texas

So you are willing to move to any of those 3 cities?   Very different places in my opinion.
Are you working remote, or will you need to find work?

I don't really know anything much about Houston and SA markets.   One thing about Houston is be careful of flood zones and flooding.  People have forgotten about that since the big flood several years ago.  Lots of stuff covered up by now.

SA, not sure how true it is or if a general statement applies across the board, but have seen several reports about falling rents lately.   

DFW area.  Not a lot of 4 plex for sale, and pretty rare a single story 4plex in my 25 years of experience.  I'm racking my brain to think if I've ever seen a single story 4plex.  Probably I have, but seems pretty rare in this area.   What is your thought on single story?   Most I see are 2 story, with living-kitchen on 1st floor, bedrooms on 2nd floor.   I look at every multi 2-4 that comes on the market every day in 6 of the DFW area counties.  Very few and often prices don't make a lot of since for my best investors.   Typical deal will probably need about 40% down to break even right now.  Some maybe 50%.  Lots of investors trying to park money, very little inventory.   So not sure if that's what you are thinking or not.

What price range are you thinking?   My first thought is you need to talk to a lender and see how much you can borrow, and then see if that fits in your plan.   I have lenders I can recommend if you need assistance.

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Loren Polito
  • Real Estate Agent
  • San Antonio, TX
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105
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Loren Polito
  • Real Estate Agent
  • San Antonio, TX
Replied Sep 17 2023, 13:38

@Ruben Beraza

If you have any questions on the small multifamily San Antonio market or good neighborhoods to focus on please let me know. I’m originally from the Bay Area myself and made the move out here a few years ago and couldn’t be happier.

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Christopher Busken
Pro Member
  • San Antonio, TX
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Christopher Busken
Pro Member
  • San Antonio, TX
Replied Sep 17 2023, 14:52

Howdy! Can't say I've seen any single story 4 plexes. There is a two story 4 plex for sale in SATX currently, but I think it'll take a significant amount of work. I'm happy to send that on to you. 

I've been pleased with the service I've received from Robert Rees at Legacy Mutual Mortgage. 

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Jodi Gauthier
  • Real Estate Broker
  • Houston, TX
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86
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Jodi Gauthier
  • Real Estate Broker
  • Houston, TX
Replied Sep 20 2023, 19:08

Welcome to Texas! Houston is a great market for house hacking. First step would be connect with a local lender familiar with the strategy specifically utilizing fha loans. Happy to connect you with a few if you're interested. 

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Aaron Francl
  • Real Estate Agent
  • San Antonio, TX
58
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67
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Aaron Francl
  • Real Estate Agent
  • San Antonio, TX
Replied Sep 21 2023, 07:21

Hey @Ruben Beraza congrats on taking this initiative to start your journey. 

I've lived in all 3 of the markets you mentioned and I will say, I'm enjoying my time here in San Antonio far more than the others! A lot of your choice will come down to some personal preferences, lifestyle and pace choice and, as others mentioned, financing. Entry price varies quite a bit for these 3 markets and a lender will help you narrow from the financing standpoint. 

I also started with a house hack multifamily as my first purchase as well. It's a great way to go. I think you hit the nail on the head when you mentioned looking to "value add." I think most investors and agents familiar with this market will tell you that to win right now, you really want to find ways to add value. A lot of folks sit on the sidelines right now, running numbers with market rents, and their potential PITI and stop there. Whichever market you choose, you've already got the right mindset!

Feel free to reach out to me if you'd like to connect more on San Antonio. 

Best of luck!

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Ruben Beraza
  • San Francisco Bay Area
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Ruben Beraza
  • San Francisco Bay Area
Replied Oct 1 2023, 13:14

@Bruce Lynn Hey Bruce! 

Yes, the idea, would be move to one of these cities & will be working remotely. Appreciate the heads up on the Houston market natural disasters. Hurricanes & floods seem to be a predominate natural disaster in the Texas markets. Perhaps more than others.

You're right. When it comes to Houston / DFW area, not many 4plex have been listed, but many have in pending. Could be the just todays market environment. There are quite a few of Sell By Owners listed which would be a value add play there. Reason for mentioning single story 4plex is to have the ability for tenants to pay for water/utilities vs. it being an extra expense I accrue. Would be a nice to have. 

IF you can recommend lenders, that would be greatly appreciated Bruce. Connecting with you now to continue the conversation. 

Much appreciated! 

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Ruben Beraza
  • San Francisco Bay Area
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Ruben Beraza
  • San Francisco Bay Area
Replied Oct 1 2023, 13:25

Hey @Loren Polito

Appreciate your response to my post! 

Happy to connect with you to learn about the SA market as I do my due diligence. Sending you a connection request! 

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Ruben Beraza
  • San Francisco Bay Area
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Ruben Beraza
  • San Francisco Bay Area
Replied Oct 2 2023, 14:11

@Christopher Busken Howdy! 

Studying Zillow over the last month, single story 4-plex are rare to find in the TX markets I've been searching & analyzing. Realizing that it may take me bit longer to find what I'm looking with my initial criteria, so I may have to pivot slightly. 

Happy to take a look at the 4-plex it if it's still available. 

I'll connect with you to continue the conversation. 

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Ruben Beraza
  • San Francisco Bay Area
3
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Ruben Beraza
  • San Francisco Bay Area
Replied Oct 2 2023, 14:35

@Jodi Gauthier Hi Jodi! 

Thank you for the warm welcome! 

Just sent a you a connection request. Happy to connect with you to continue the conversation. 

-Ruben

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Ruben Beraza
  • San Francisco Bay Area
3
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Ruben Beraza
  • San Francisco Bay Area
Replied Oct 2 2023, 14:42

@Aaron Francl 

Thank you for providing a couple aspects to think about as I embark on this journey. It's much appreciated. I agree, it will come down to preference in addition to financing options. 

Sending you a request to connect & continue the dialogue! 

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Aaron Duthie
  • Investor
  • Frisco, TX
17
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Aaron Duthie
  • Investor
  • Frisco, TX
Replied Oct 3 2023, 14:06
Quote from @Ruben Beraza:

(First Time Home Buyer / House Hacking)

Hello BP Community,

I'm based the Bay Area, Ca & have fix n flip experience in this market. I'm new to the rental side of the RE business & searching for a multi-family, single story 4-plex primary residence in the Texas-San Antonio, Houston, Dallas markets. I plan to leverage an FHA loan to kick off my long term rental portfolio. I'm aiming for a mix of appreciation & positive cash-flow after some value add work is done to the property over the course of first year of ownership. I plan on putting some elbow grease myself but mostly contracting the work out to allow the professionals to do what they do best. I know this may be very difficult in todays market, however it's possible.

In addition, I’m wishing to connect & build relationships with local investor friendly agents in these areas who invest themselves, help clients with investing opportunities & are tapped into off-market listings. If you have experience structuring creative financing deals, all the better. Open to agent recommendations / money lenders as I begin to get my ducks in a row to execute effectively by no later EOY. Much appreciated & thanks in advance! 

Happy to connect via BP / Zoom / IG whichever platform works best to fill in any gaps in my post. 


Hi Ruben - couldn't agree more on your plans to house hack a multifamily here in Texas. 

I'm wrapping up my first duplex house hack in DFW (selling off-market now) and it's been by far the most rewarding experience, so much so I'm transitioning careers to get more involved in RE! Would love to connect and share what I've learned throughout the process so far.

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Ruben Beraza
  • San Francisco Bay Area
3
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Ruben Beraza
  • San Francisco Bay Area
Replied Oct 3 2023, 16:12

@Aaron Duthie How's it going! 

Congrats on on your first duplex! Hell yeah! Nice to hear it's been a rewarding experience for you & great to hear you're taking action! 


I'm following up with you to find time to connect! 

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Ruben Beraza
  • San Francisco Bay Area
3
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Ruben Beraza
  • San Francisco Bay Area
Replied Feb 26 2024, 19:36

Hello Everyone! - Providing an update here. 

Since posting this 5 months ago. Wanted to let you guys know that I recently bought 1 unit condo in Ohio. At this moment, currently looking for a tenant to occupy this unit. This was an all cash deal and did not manage to purchase a mortgage to my foot in the door. It'll be cash flow + as soon as a tenant moves in. 

Turning my focus back to house hacking in house hacking in Houston Tx. I since have learned about the 5% conventional loan option and is a loan I would like to leverage to purchase a 4plex. Perhaps even leverage the loan option for an 8plex if I decide to partner up with another investor on ownership where partner also takes out a 5% conventional to help fund the purchase and split ownership in a way that makes sense. Loose idea but possible. 

Some of the areas I'm considering in Houston is Midtown, Museum District & Montrose. I'm open to exploring other areas as well. Open to suggestions. 

Cheers, 

Ruben B. 

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Bruce Lynn#2 Real Estate Agent Contributor
  • Real Estate Broker
  • Coppell, TX
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Bruce Lynn#2 Real Estate Agent Contributor
  • Real Estate Broker
  • Coppell, TX
Replied Feb 27 2024, 02:57

@Ruben Beraza  Congrats on the purchase in Ohio.

Check with your lender about the difference between 4plex and 8plex.  Loans are different.  Chances are no 5% loans for a 8plex.   Normal max will be 4 units.

Come to DFW vs Houston.  Things are a lot more organized up here in the Northern Territories and we don't get hurricanes.   Either way, welcome to Texas.

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Adam M.
  • Investor
  • Texas (DFW & West Texas)
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Adam M.
  • Investor
  • Texas (DFW & West Texas)
Replied Feb 27 2024, 05:54

@Bruce Lynn I agree come over to DFW sir! 

@Ruben Beraza As a California expat who relocated to TX myself, I would urge you to get cracking with FHA as your first step. Speak to your lender and make sure they are on board.

As you mentioned: it will be hard but not impossible to find the right deal-- something you should bear in mind also is that when you are looking for 2-4 units with FHA, duplexes have to pass less "tests" to qualify your financing and are typically easier to get into. Depending on your personal finances, shopping for a triplex or quadplex may require the existing market rents to pass a self sufficiency test, to ensure that you will be able to pay the note.

Speak to your lender about FHA requirements to ensure you qualify for what you are looking for and get a pre-approval letter that will help you get a competitive edge when looking for a deal like the one you have described. Good luck and hope this helps! 

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Quinn Olivarez
  • Real Estate Agent
  • Houston, TX
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110
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Quinn Olivarez
  • Real Estate Agent
  • Houston, TX
Replied Feb 27 2024, 12:37
Quote from @Ruben Beraza:

Hello Everyone! - Providing an update here. 

Since posting this 5 months ago. Wanted to let you guys know that I recently bought 1 unit condo in Ohio. At this moment, currently looking for a tenant to occupy this unit. This was an all cash deal and did not manage to purchase a mortgage to my foot in the door. It'll be cash flow + as soon as a tenant moves in. 

Turning my focus back to house hacking in house hacking in Houston Tx. I since have learned about the 5% conventional loan option and is a loan I would like to leverage to purchase a 4plex. Perhaps even leverage the loan option for an 8plex if I decide to partner up with another investor on ownership where partner also takes out a 5% conventional to help fund the purchase and split ownership in a way that makes sense. Loose idea but possible. 

Some of the areas I'm considering in Houston is Midtown, Museum District & Montrose. I'm open to exploring other areas as well. Open to suggestions. 

Cheers, 

Ruben B. 


 Check your DM Ruben! I have expertise and experience in the exact neighborhoods you're looking at in Houston; I own investment property in the museum district, and have lived in midtown / museum district / Montrose for nearly 20 years. I commonly assist long distance investors, whether it's for relocation or just to get into the awesome TX gulf coast market. Would be happy to help you in your exploration. 

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Ruben Beraza
  • San Francisco Bay Area
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Ruben Beraza
  • San Francisco Bay Area
Replied Feb 28 2024, 19:40
Quote from @Quinn Olivarez:
Quote from @Ruben Beraza:

Hello Everyone! - Providing an update here. 

Since posting this 5 months ago. Wanted to let you guys know that I recently bought 1 unit condo in Ohio. At this moment, currently looking for a tenant to occupy this unit. This was an all cash deal and did not manage to purchase a mortgage to my foot in the door. It'll be cash flow + as soon as a tenant moves in. 

Turning my focus back to house hacking in house hacking in Houston Tx. I since have learned about the 5% conventional loan option and is a loan I would like to leverage to purchase a 4plex. Perhaps even leverage the loan option for an 8plex if I decide to partner up with another investor on ownership where partner also takes out a 5% conventional to help fund the purchase and split ownership in a way that makes sense. Loose idea but possible. 

Some of the areas I'm considering in Houston is Midtown, Museum District & Montrose. I'm open to exploring other areas as well. Open to suggestions. 

Cheers, 

Ruben B. 


 Check your DM Ruben! I have expertise and experience in the exact neighborhoods you're looking at in Houston; I own investment property in the museum district, and have lived in midtown / museum district / Montrose for nearly 20 years. I commonly assist long distance investors, whether it's for relocation or just to get into the awesome TX gulf coast market. Would be happy to help you in your exploration. 


 Hey Quinn, 

Appreciate you replying to my post. Perhaps we can connect. I went ahead and emailed you!