All Forum Posts by: Erere Ovirevarie

You should open title as soon as you have the property under contract. 

@Erere Ovirevarie MF typically does not show up as much on regular MLS and general RE agents. The properties are there you need to change your food chain.

I would join a REI or landlord association in the area you are interested in. Find those using google. Generally membership is cheap and the support and networking is excellent.

The best use of an FHA loan on a single family home to get started in investing would be to house hack by renting by the room. If you were thinking that you could use an FHA loan on a rental which is a pure investment property, that is not allowed.

@Erere Ovirevarie

I am sure you are anxious to get into your first multi-family but I would tell you to not be in a rush as I feel the market will get better for a buyer in the next 3-5 months. Get to Houston and drive around look at areas and find one or two that you like. Start becoming an expert in those zip codes. Houston is really big and trying to map all the properties around Houston might have you in analysis paralyzes. Another thing there aren't many new tri and fourplexes being built because of how the city treats them via code so more costly to build than a SFR or Duplex. So more than likely you will have to buy an older one and that might cause issues with FHA as they require a move-in property, not rehab.

Another thing to consider is what HCAD (property tax) has it valued at versus the price you are buying. Your property tax will readjust to that purchase price next year and thus can whip out cashflow. Also if a property is 50+ years old with no work done with permits the insurance companies will charge more for those so take that under advisement when crunching your numbers.

Meetups are found on this site but can try places like Eventvrite.com 

Welcome to Houston and best of luck 

Reach out if you need help. I made a one page document of all the steps to follow. 

1. Yes, inventory is coming online all the time after the economic shift we are having. 

2. Need to know your number $ per door first with comps in the area. Knowing all your numbers is super important, and getting a pro forma from the current owner and the rent roll etc will help you forecast the future. 

3. FHA is great but on Multi's is most likely not going to happen.

4. I am in Austin but the Houston market is close to ours minus some appreciation inflation

5.The down payment is a start, but of course the more the better. If the property cash flows the bank will love that. 

@Erere Ovirevarie Welcome to Houston

Answers to your questions:

(1) is this the right time to invest in multi family due to high interest and skyrocket home prices?

It is always a good time to buy as long as the numbers make sense. What you have to do is consider all of your expenses into your calculation and if that makes sense then by all means it's a good deal. Now, a lot of times people are waiting for the perfect time to buy but I can tell you right now that will never happen. RE goes along with inflation and while interest rates can go down, the value of RE will not. What you need to do is refinance at a later date when interest rates are low. Also, consider this; if you are currently paying rent let's say $1200 and moving to a new house that you will buy will cost you $1300 per month I will say yes to this. Why? because you are at least putting money into your own property and no one else's. I did this and in 3 years the equity of my personal residence is about $70K. You could also house hack and split the bills in half or even get more creative and rent by the room.

(2) what are the things I should be looking for in order to get a good multi deal that will be profitable?is it fixed interest,the value of the house and the cash flow after expenses?though I order for Brandon turnel multi family investing book but not yet arrived

The best deals out there are value add deals. Why? because technically the BRRRR method is one of the most profitable methods out there. You could end up in a scenario of not putting any of your own money after all is done. However, I would not recommend taking on a big rehab by yourself if you have no experience. Either partner up with someone that has already done a few or get something more turned key, which sounds like what you are looking for. One thing I will say though, it is going to be challenging to find an on-market cash flowing property in the Houston area. For something on market to cash flow, you will have to get really creative about what strategy will generate you the most profits for your property.

(3)should I contact FHA lender right now for pre approval or still hold on?

Definitely, I would contact a few actually. Ask them to pre-approve you and to issue a letter for at least 3 months (6 months ideally). One thing to highlight here is that your credit score will be impacted a bit (soft credit check) after the first lender pulls your credit, but it will not continue to drop regardless of how many lenders you apply for within I believe a month or two (please double check this) 

(4)can anyone also link me to REIA meet up in Houston area if there is any...thanks

There are plenty of RE meet-ups in the Houston Area. I usually attend a meet-up every Thursday. PM me for more details on this

(5)will 25k be enough for down payment for triplex or four plex multi family ?

This will depend on the value of the property and the type of loan you get. Best to talk to your lender. They will have a very accurate answer on this for you once you sort out the property and the loan type.

Hope that helps

 Thank you very much for your detail explanation..I appreciate it 

 Austen is completely right, with the way interest rates are at, there is really no competition when it comes to buying an investment property. Of course you would have to look at what you can get out of the property i.e. cash flow or return value. Would love to have a chat with you about what your routes you could take! As an agent in the Houston area, I could give you a helping hand, feel free to PM me!

(1) is this the right time to invest in multi family due to high interest and skyrocket home prices?

Answer: Yes now is still a good time to invest in a househack. What makes househacking so great is the little out of pocket expense utilizing an owner occupant loan. In this softening market we are seeing more opportunity for buyers to get seller assistance to pay down loan points(increasing cashflow) or covering closing costs(increasing cash on cash return)  

(2) what are the things I should be looking for in order to get a good multi deal that will be profitable?is it fixed interest,the value of the house and the cash flow after expenses?though I order for Brandon turnel multi family investing book but not yet arrived

Answer: I cant speak for your market however in my market of Pennsylvania we no longer see househacks that cashflow while you live in the property. If you can pay of your mortgage that's great. at that point your most likely coming out of pocket less than you would if you were a renter in the same market. If it cashflows when you leave that's really what your looking for.   

(3)should I contact FHA lender right now for pre approval or still hold on?

Answer: I would look for a lender and get pre approved now! its my understanding you only need two years of work experience if you get paid via commissions. If you have a w-2 job then you just need 2 paystubs. If you cant get pre approved you can come up with a plan with the lender to give yourself a path and actionable steps towards reaching your goal. Its always worth the call. 

(4)can anyone also link me to REIA meet up in Houston area if there is any...thanks

Answer: Cant help you there haha

(5)will 25k be enough for down payment for triplex or four plex multi family ?

Answer: that depends on the market. But my guess is that is a little tight. You may also want to consider a duplex or a single family that you can fix up. Remember you get what you pay for. you may want a 3/4 unit for cashflow. but for that price it may be in terrible shape or in a part of the market where you don't want to live and have a hard time renting. 

Hope that helps. I wrote a little blog on this actually. I think you can see it if you go to my page.