All Forum Posts by: Dylan H.

@Aisha Duff Military approved neighborhood? Elaborate please

@Stephanie Sicard I would analyze the property as if you were not living in it. The end goal of house hacking is to obtain a house with a low money down loan, live cheaply or free for a year or two, then repeat. You want to have multiple exit strategies, one of which should be a cash flowing rental property after you move in my opinion. I wouldn't consider a house hack if it's not going to cash flow once I move out.

It's in an area called Emerald Shores off of Buoy Drive. About a half mile from the back gate of NASP.

@Dustin Sanders

Hey Dustin, I just closed on my house hack in Pensacola. It'll be hard in my opinion and from my experience to find a multi family that are in decent shape or location. Even the SFR's are going super fast in that market now, any decent house that hits the MLS in a good location is getting multiple offers within 24-48hrs. I ended up spending a little over asking, but that's how the markets going currently. I would just start looking at deals in the areas you like and saving them on Zillow or something so you can get alerted when they go under contract so you can get an idea of the pace and time you'll have once you find something you like and are ready to actually make offers.

@Erik W. Great, thanks Eric! And everyone else!

Erik are you investing in Springfield to meet to the 2% rule?

Recently, instead of bouncing around on the podcasts to different titles that caught my attention, I thought I would add some structure to my listening pattern and start going in order from the very beginning. As many of you know, they started posting the podcasts in 2013, about four years after the bottom out of the housing market crash. I found it pretty entertaining that @Brandon Turner and @Joshua Dorkin were even speculating a little back then that the market was rising too quickly and we were nearing another bubble or correction. Obviously, hindsight is 20/20 and 2013 would have been an amazing time to buy real estate since the market has seen tremendous gains since then. 

Well, it's six years later, and the market has continued to rise. Current market conditions seem iffy at best, it's a sellers market for sure, and competition has skyrocketed in the REI realm. Warren Buffet famously states "When everyone is buying, sell. And when everyone is selling, buy."

@Scott Trench even stated "we are always 12-18 months away from our next crash." Have a strategy that works in every market is obviously key, but you also cannot blatantly state that timing is unimportant. We consistently hear on the podcast to "take action," even some stating to do whatever is necessary to get your first deal under your belt. Take out cash advances on credit cards, borrow hard money, find friends and family to invest with you. But, I would argue, if you do do this at the wrong time, you have the potential to take a devastating blow to your financial future, that could set you back years. 

I'll openly state, I'm not waiting for the 'right' time or market. I just paid $3k over asking on a house hack that I'm 100% leveraged on through a VA loan. Sure, I could be underwater immediately in any sort of downturn, but I'm not worried, because I know I can meet the 1% rule and at least break even monthly, if not cash flow a little, even after I move in a year.

So, what do you say to a newbie in this market, getting started? What are your tactics to protect yourself or prepare for action if there is a correction? Would you recommend someone with little cash reserves take on extreme borrowing to knock out their first deal?

My opinion, there's no right or wrong time, there are advantages and disadvantages to every state of the market, but do not say that timing is unimportant, because it could ruin someone starting out's life if they make the wrong moves.

As I'm starting out I've been analyzing deals and having different investors send me their PNL's and Rent Rolls on investment properties they have. Am I wrong to think they are wrong to be using CAP rate to analyze properties that are 1-4 units? Whether we like it or not, isn't the value of anything 1-4 units strictly based off of comps and appraisal?

Thanks for the input.

@DJ Snow

Did you read the HOA bylaws before purchasing the property on short term rentals? It would definitely state the expectations and length of minimum stay. Or did these changes occur after you purchased the property? It's always risky with a condo complex, they're hard to sell, the HOA can also change their rules, and you have to worry about their(HOA) financial situation so you don't get hit with random assessments that eliminate your gains.

@Logan Sims

Great questions

@Heston McBride

Wait.. Shouldn’t the seller be paying the commission anyways? Are you trying to save the current seller money since you know them. Typically the buyers and sellers agents will just split the commission that the sellers agent agreed to list the house at. Unless you had some previously arranged deal with your agent which is doesn’t sound like. Have your agent submit the offer, just for your own reputations sake.