All Forum Posts by: Jared Skov

Jonathan Hulen It was a really weird deal, they even spent about $18k fixing everything that came up in the inspection. We came to find out later that it was an elderly couple who were liquidating all assets and wanted to do some traveling in their twilight years...

After sitting on a chunk of change for 6 months from our last live in flip, waiting for the right opportunity, we finally found a good deal on a duplex. Let me first start off by saying you can find the right deals in a hot market if you're patient enough and good at negotiating. We were tired of our savings account only making us $8/mo but didn't want to tie up any more in the stock market. Literally $8/mo, so we could buy and split a sub sandwich one day a month?

Fast forward to purchasing a duplex early January of '18 with 25% down, now April 1st 2018 and we're cash flowing $650/mo while the mortgage principal is being paid down ~$360/mo by our tenants. Finding a cap rate >7 on a duplex with positive cash flow in Western Washington seems like a unicorn in this market, but we found it and so far I enjoy mowing the lawn every 2-3 weeks as an excuse to check in on the tenants. Now that our money is working for us, we are going to sit back and see what happens with this crazy market while our duplex savings grows for the next appliance failure or tenant moving out. The Seattle area real estate market is still on fire, leading the country for the 17th straight month! It has to slow down at some point right?

I like the cash out refi in this scenario because the interest rate is fixed. Rates are rising and paying interest only on a HELOC seems a little risky when things cool off. Just make sure wherever/whatever you buy has a good cap rate. You're still young, so take your time with your stash of cash and just make sure you double and triple check the math before buying, it may be the biggest long term financial decision of your life. Your cash in hand is better than paying interest only while you find your investment property.

Do you currently have a primary residence? If not, you can acquire the multi family with only 5% down. This makes sense if you can still make it cash flow positive or even break even in the beginning. Perhaps fix up a couple units, increase rents, live there for 1 year, then move on to the next multi family. Spend the next 5-7 years doing this till you have four multi families, then re-finance all 4 multi families into one LLC and one loan. From there, hire a rental management company, sit back, and enjoy...

House hack for sure. 5% down on up to a 4 unit place, live in one of the units and fix it up. As people move out, fix those up and rent the one you were living in for more. Do this for a couple years, then move to the next one... or retire.

It's all about cash flow, your money making you money. What will the cap rate be? I don't know your market, but in the Seattle area, any cap rate >7 is a good deal. 

What is your current mortgage? (Principal left vs. Value) and your current interest rate. What type of property are you looking to purchase and location?

Try to avoid business with friends and family if you can, I’ve seen it ruin the best relationships. Since you’re using the house hacking method, can you guys afford the 5% down payment alone?

Trying to figure out what the best path is to FI/RE. My wife and I make around $190K/yr and currently live in a home that we don’t plan on leaving anytime soon. If we did leave, we would rent it out anyway. Our SFH is worth $360K with $275K left on the principal. Our duplex is worth $350K with $252K left on the principal with current cash flow of $700/mo ($350 per side). My question is do we focus on paying off our home, the duplex or save for another investment property? I️ like the idea of attacking the duplex principal and paying it off as quick as possible to generate $2500/mo in cash flow, but saving for another rehab rental is attractive too. SFH is 30yr/3.625%, duplex is 30yr/4.25%. Any suggestions are greatly appreciated!

I️ did this on my first purchase 5 years ago, put $10K into 5 stocks, made $2K in 7 months. Looking back, the roller coaster of ‘maybe’ making more money for a down payment was not worth the reward. It could have easily gone the other way, but I’m a gambler and the last few years have treated me very nice.