House Hack Plan Feedback (Brooklyn Ny)

[Jonathan DiMuccio]

Hi All,

I have been reading on here for a bit now and have been saving up, and wanted to share my plan for house hacking in NYC and get some feedback.

High level:

- Looking to spend 200k upfront

- 300k combined gross income (so I think we should be able to get approved for up to $10k/month debt)

- Looking for 2/3 unit multifamilies in brooklyn

Details:

Some examples recently sold:

990k 2 unit https://www.zillow.com/homedetails/983-Rogers-Ave-Brooklyn-NY-11226/30667069_zpid/

1.2M 3 family https://www.zillow.com/homedetails/106-E-32nd-St-Brooklyn-NY-11226/30660044_zpid/?

Upfront:

- 5% down FHA, 60k. Considering FHA due to new mortgage insurance reduction (0.7% yearly), then refinance once getting to 20%

- Closing costs 3%, 36k

- high cost 100% necessary renovation (boiler, etc.) 30k. Hopefully this will become more clear after looking at the home and it can be negotiated with the final cost.

- DIY Remodeling (vinyl floors, update appliances) 30k

- 8k - Cover Lost rent for 2 months while remodeling units. This would only be for the units that need to be rented, then we would upgrade the living in unit slowly over time

- $7.2k monthly mortgage ( 1.14M / 30yrs at 6.5%)

- $665 mortgage insurance: calculated at 7$ per $1000 value, or 0.7% yearly. This is based on the new government FHA insurance https://www.hud.gov/press/press_releases_media_advisories/hud_no_23_041

- $650 property tax monthly

- $400 home insurance (not sure if this is accurate from zillow)

Other:

• Utilities: $500/month?
• Maintence: $500/month

Total expenses: $9900

Rental income:

• $4-6k: Dependent on 2/3 unit

Total costs: $3,900-$5,900 monthly

- Does this seem reasonable?

- Should I consider a conventional loan? I am not sure what the mortgage insurance cost is like out there, or how much more difficult it will be to secure a deal with this type of loan.

Thank you.