All Forum Posts by: Irene Low

@Irene Low

Difficult to make anything cash flow with 6%-8% down, especially with current interest rates.

Instead, look at it from a long term perspective: 3 to 5 years out. Play out a conservative appreciation, principal pay day and year over year rent increases.

You'll see significant net worth growth and the asset more likely to cash flow after you move out.

Most properties do not cash flow at all with the current interest rates. What you can do is buy so far under market value and maybe structure a loan to have interest only payments to cash flow for a few years until interest rates come back down. There are four plexes in Killeen that cash flow currently.

 You will have fewer options for duplexes, so 3-4 months may not be long enough depending on the market.  Finding a place in a safe area is important whether you live in it or renters do. You need to think about the type of tenant you will attracts.  If you only looked at one place that needed to be fixed up and changed your mind, try looking at one that needs less work.  Also separate what is cosmetic vs major renos (eg coat of paint and a good clean vs problems with a foundation).  Fixers are cheaper, but you need the money to fix them.

Are you working with a realtor who is used to working with investors?  If not, find one who is.  As for negotiating $50K less than asking-that depends on what the asking price is and how long they've been on the market.

Hi Irene! I think units are the easiest way to house hack! In the middle of November a new loan program came out from Fannie Mae that requires only 5% down on 2-4 units. Make sure to compare the fees, payment and rates between FHA and Fannie Mae.

As Theresa Harris said, it is very difficult to have a property cash flow with only a small down payment. This makes looking at historical data on appreciation very important. 

Do some research on what the predicted appreciation is for 2024 and beyond in the areas you're looking. This could help you decided on exactly what are you think could be best to buy in. Also research where rents are the highest and if there are any multi unit properties available in those areas. 

Try to estimate how long you will live in the property. Generally speaking, the longer you live In it the easier it will be to have it cash flow when you move out. 

Sometimes the riches in real estate happen quickly but most of the time it is a longer haul to get to having both equity and cash flow. If you are willing to invest the money AND the time, I'm sure you'll reach your financial goals!

Because you are putting down less than 20% (which is what most people buying rentals put down as they aren't living in the house), it will be harder to find something that cash flows.  The higher interest rates will also make it harder.

How long have you been looking and have you thought about changing your criteria on what you are looking for?