All Forum Posts by: Daniel Haberkost

@Kole Moore you’ll hear differing opinions on this but I am very much of the mindset that you should go live where you want to live and build a business there (that’s what I did).

House hacking works very well in expensive markets as you’ll have far more people looking for non-traditional rentals. It’s amazing how quickly you’re able to progress when you eliminate your housing expense.

As a couple others have mentioned, sounds like you already know where you want to live/invest. I’d start saving as much money as you can while also learning/networking so you can really hit the ground running when you graduate.

-Dan

@Julian Maso I'm somewhat familiar with Waco and have heard that it's one of the less desirable cities in TX BUT if you screen your tenants thoroughly you can still find good people. 

Sounds like your father is a great resource, I'd still look to network with other investors and especially those who are more focused on residential RE since that's where you want to start. I've gotten tremendous value from some of the local meetups here in CO. 

Feel free to message me anytime if you have house hacking questions.

-Dan

 House hacking is a great way to start! You said you have enough for 15%-20% down payment, if you house hack you'll only need a small portion of that for the down payment so you can keep the remainder in reserves. 

I house hack my primary residence too. I live near a college but I don't rent to college kids because I want long term tenants (and I don't want to deal with college kids!). What market are you in? If you're in the Midwest it may be a bit harder because everything is so cheap but if you're somewhere that's a bit more expensive there will be plenty of responsible adults looking to rent single rooms. 

As far as your concerns with your local market, have you spoken to local investors? Attended any virtual or in person meetups? Talk to others who are doing what you want to do in your market and that will help to alleviate your concerns. 

-Dan

@Brent Zande I feel the same way, but I’m fairly risk averse and tend to be overly conservative/pessimistic.

I do think we’re living on borrowed time and there will have to be a recession across the board. It will probably end up not being as bad as you/I think just as it won’t stay as bullish as many of the people you reference think. It will likely fall somewhere in between.

But, who knows! I’m just speculating and could be entirely wrong. So I’m continuing to make offers but am being conservative, factoring in the chance of a significant drop in values, and keeping a healthy amount of liquidity.

What are you doing in your business?

@Beliria Sims 

My input would be regarding goals/mindset more above anything else. The first podcast I ever listened to was centered entirely around large multifamily. Every guest "owned" hundreds or thousands of units and that's what I thought success had to look like. Several years and a few strategic acquisitions in and I realize how completely arbitrary many of the parameters we all focus on are. Figure out why you want to invest, set your goals accordingly and don't worry what anyone else is doing. 

I also strongly agree with @Sam Lewis, don't do your own rehabs! I didn't end up covered in blood but I have absolutely zero idea of what looks good and you would probably laugh if you saw some of the colors/finishes I put in my first rehab.....

Good luck!

-Dan

 Hey Mark, I live in The Springs but am very active in Pueblo, actually just got an offer accepted verbally on an off market property from one of my mailers. 

I would enjoy chatting, where are you located?

@Adam Vasquez hey Adam, house hacking here works very well and I’ve been doing it for years.

BRRRRing is going to be a serious challenge as finding a deal (especially multifamily) that you can get low enough to pull all of your money out at the end is not easy. If you’re skilled at marketing direct to seller than it’s possible but still not easy because of the competition here.

As the others said, a knowledgeable realtor is key! I would highly recommend @Colin Smith, he knows the area extremely well.

Good luck!

-Dan

 Makes sense, it's definitely easier to get cash flow in the cheaper markets. Are there any cash flow markets where you have contacts that you already know/trust? Going that route you will be very dependent on the people you have on the ground helping you find deals and managing them. I'm from OH originally and many out of state investors buy in Cincinnati/Columbus/Cleveland/Toledo because the numbers look great on paper but they don't realize they're buying in a war zone...... 

Point being, make sure you invest the time up front to interview and hire the right people whose interests are aligned with yours! 

@Sharon Miller It's supply and demand. Houses steadily increased in value here in CO Springs through the entirety of the shutdown and most of the country is in short supply of housing so the same is happening in nearly everywhere. 

I'll tell you what I'm doing but I'm not going to directly answer your question because you have to decide that for yourself. 

I'm continuing to make very conservative offers on properties in C+ to B+ with value add potential while keeping healthy amount of liquidity. That's it. I like to keep things simple. 

Hope that helps!

-Dan

@Tyler Smith there is no right or wrong answer to this, every positive can also be framed as a negative. I personally want to deal with as few tenants as possible and prefer nice single family homes where the long term amortization/appreciation is the primary wealth builder. But there are many very wealthy people who own cheap multifamily with the sole focus being cash flow (and of course those two are not mutually exclusive). 

So the best way to decide is to look at your goals/skill set and figure out what makes sense for you. What is your primary reason for wanting to own real estate?