All Forum Posts by: Bradley Dosch

Hey Dustin, that's awesome you have the humility to admit you know nothing and that you want to get started. That attitude will get you far. Scatter brain and shiny object syndrome is common. I'll keep it short - I recommend starting by house hacking a large single family house with a low down payment loan. I can go on about the details but I'll leave it at that. Good luck Dustin! 

Single-family residence buy & hold investment.

Purchase price: $490,000
Cash invested: $30,000

This was my second house hack and first property in Wa state. I actually never ended up living here. I rent this out by the bedroom and I pay for all utilities, including the best wifi possible and monthly cleaning service. I manage this rent by the room myself using Avail and I rarely go to this house. The tenants seem to like living there and it's my best performing house of the 3 I own so far.

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

Finding a large single family house with separate entrances and living areas is a very accessible form of house hacking/investing for many people. It can be tough to cash flow with multi family or traditionally renting a SFH. It is not as much work as a STR and gives people more affordable housing because the rent of a bedroom is much lower than that of a studio apt. This fit my criteria very well. This house has two separate kitchens, laundry units, entrances, and living areas.

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

I found it on the MLS and asked for $10k seller concession instead of price reduction. I was the only interested buyer for some reason.

How did you finance this deal?

I used 3.5% down FHA and got a 3% rate in exchange for a lender credit. I wanted to and recommend that you use 3-5% down conventional financing for SFH house hacking but my DTI was just barely too high for conventional. FHA allowed for my slightly higher DTI. The MIP is very expensive and never drops off but I can always refi later down the road.

How did you add value to the deal?

Added LVP to the entire upper level, got the tenants the best wifi possible (1.2 GBPS), fully renovated upstairs bathroom, replaced broken sliding glass door, and a handful of other inspection items. I spent about $25k on these renovations. I did none of this work myself.

What was the outcome?

Tenants love living there (I ask them often) and it cash flows $700/month even with the high MIP.

Lessons learned? Challenges?

It's painful to spend money on upgrades upfront especially when it's expensive and you just want to start collecting rent money. But... it's so worth it. The hit of the cost wears off over time and your tenants will really appreciate it. If you focus more on giving people a great place to live, you'll have much more success

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

Yeah I worked with myself as the agent - great service, couldn't have asked for better. I used Albert Bui as my lender and a handful of tradespeople for the renovations.

Hi Gibran, I've done rent by the room leases in both Pierce and Snohomish counties. I've just used Avail's leases that they get from the state and then I add/edit my own language to tailor it to rent by the room. Stuff about house rules, being respectful, and who pays utilities. I can show you if you'd like, hope this helps. 

Definitely option 1 is the way to go! I made the mistake of doing option 2 and it made it so much harder to get a HELOC (I eventually did). I would check with your lender first. Just make sure your DTI won't be affected too much by the HELOC when purchasing the next house hack. The HELOC is better than a refi in this case bc if you did a refi you'd have to intend to live in it for another year. With a HELOC, you can open it as your primary and then move out next day if you wanted. Great question Evan!

That's an awesome deal! I love that you used the low down payment FHA loan. Thanks for posting Nathan!

Hey Nikel, it's great to hear you want to get into house hacking! My advice is to get connected with local experts in your area and just get started. Take some time to learn but don't fall for procrastination by preparation. You'll learn and grow so much more by just going for it. You'll be able to leverage the experience of those who help you through the process assuming you choose correctly. Good luck Nikel!

Don't wait. There will always be something to wait for - just go for it and get the process started!

Just do it! Focus on the big things that fit your criteria and just pick something. The more time you wait, the less experience you're gaining. It won't be perfect and there will be lots of mistakes but you have to look past the first year and realize this is a long term investment. Great questions and good luck Connor!

Congrats Louis! Getting that multifamily house hack is a big baller move!