All Forum Posts by: Account Closed

@Xavier Martin, if house hacking is an option, that could be a great way to get started. Grand Rapids is a hot market, but if you could find a good duplex or triplex, you'd have a place to live and have tenants paying most or all of your mortgage. Good luck on getting started.

@Christopher Bogard, there are plenty of markets that could work in NC and plenty of active investors. If you're in NC, you might start doing some initial looking at areas close to you since that would remove some of the aspects of investing far from where you live. Find some areas and start to dig in.

Welcome to BP. I am fairly new myself. I do own a duplex near Grand Rapids that is doing well. A few recommendations I would make: Start to make connections in your area. It can't hurt to meet other realtors. You may end up choosing to use PM. You may need contractors. Etc.

Next, I'd say start to really learn more about the strategy and niche you're considering: Both small multi and targeting student housing. This could be a good strategy, but you'll want to know how to evaluate properties and what specific considerations there are for student housing. Some thoughts that come to mind would be higher CapEx, higher turnover, and summer vacancy.

Besides that, I'd say set up a keyword alert for Grand Rapids and start to read the posts and see who is chiming into those conversations.

@Jeremy Toney, welcome to BP. Good job jumping into education and saving capital. Another thing you could be doing (which you may already be) is starting to make connections and research contacts for area(s) you plan to start. You'll want to start to find realtors, lenders, contractors, PM, etc. depending on what route you end up going.

I used a HELOC to provide the down payment on a duplex, and I would second what @Jaysen Medhurst said: If you are using it as a down payment and still obtaining a mortgage, let the lender know during the process, so it doesn't cause a roadblock part way in. If you are going that route, in addition to the 100% leveraged, the lender for the mortgage will still be looking at DTI, so they'll likely need to see what your payment on the HELOC will be.

If instead, you're using the HELOC to purchase entirely, and then refi, then like @Eric Mielke said, make sure the #'s work, and have a plan to place tenants, get it seasoned, and have lenders lined up for refi since you probably want to pay down/off the HELOC sooner.

There is some good advice being offered here. I would echo sentiments on education and understanding your reasons and strategies. Besides that, how to proceed may depend on your individual context. Without more info, it sounds like in your case, one option to consider would be purchasing something that you can live in while also renting out either rooms or the other units if multifamily, i.e. a house hack as @Anthony Angotti mentioned.

@Jay Hinrichs, you mention: WEll i dont believe there is systemic racism in housing TODAY. 

I am not an expert, and honestly, am just recently trying to educate myself on some of the ways that systemic racism exists and. I defer to you every time on your real estate experience and the wealth of information you provide on BiggerPockets.

That being said, I saw your statement and wanted to do some reading. Ultimately, I do think that systemic racism is still an issue in housing today. A study by Harvard Public School of Health in 2018 (linked below) reported that:

"People of color continue to endure rampant discrimination in the housing market: 17 percent of Native Americans, 25 percent of Asian Americans, 31 percent of Latinos, and 45 percent of African Americans report experiencing discrimination when trying to rent or buy housing"

In a New York Times article (linked below), they reported that a 2012 study  "conducted by the Urban Institute and the Department of Housing and Urban Development — showed nationwide patterns of housing discrimination. After conducting 8,000 tests in a representative sample of 28 metropolitan areas, researchers found that, compared with whites, black renters and home buyers were shown substantially fewer units, as were, to a lesser extent, Asian-Americans and Hispanics."

Kicking off the 2000's and contributing to the last major real estate downturn " banks disproportionately issued speculative loans to Black and Latinx homebuyers, even when they qualified for less risky options."

In addition to current racism in housing, there are also clearly evidenced inequalities in employment opportunities and access to education, both of which might contribute to improving pervasive inequality.

I'll conclude by saying I thoroughly appreciate your contributions and knowledge on the site, but wanted to add my thoughts.

Systemic Inequality: Displacement, Exclusion, and Segregation

The Racism Right Before Our Eyes

@Todd Mobley, no problem. I think that as long as your #'s work and the deal isn't forced, it is a cool strategy. It is like another way to pull off a 100% financing. 

@Todd Mobley, I used HELOC funds for the down payment on an investment duplex. I had cash reserves but preferred to keep those aside. The #'s on the duplex allow the primary mortgage to be paid and the additional cashflow is paying down the HELOC much quicker than the minimum payments which would typically be interest only. I like @Jaysen Medhurst' s idea about possibly starting with lower stakes 100k properties. Maybe at least one as a proof of concept before using the full amount of your HELOC to tackle a much larger property. I also second his thoughts on paying back the HELOC quickly.

Thanks @Jonathan Greene. Maybe studying for and earning my realtor's license will be in my future.