All Forum Posts by: Jason Wray

Taede,

You could very easily move to Florida and buy a 2-4 unit in multiple Counties well priced to cash flow. Great place to settle in for a short or long term stay buy a primary live in an unit and move in 12 months transitioning into a full time rental. Pull cash out and repeat the process so that you can keep the doors building.

I have been here in Florida for over 30 years and its a great place to call home. No snow, depending on where you choose you can easily be 5 minutes from the beach/ocean and it does not have to break the bank. You can find a duplex for under $280K in many cities against just depends on what side of the Coast you prefer.

I prefer Gulf Side which is a great location all the way up to Citrus County, Crystal River and down past Lee County Cape Coral/Fort Meyers.

Carlos,

Are you buying that as a primary home or an investment?  I see that house and wonder why more people do not move out of California.  At that price and annual taxes it seems like it would be tough to cash flow. $525K for a 900sqft home I would move to Florida, Texas or another state before I locked into that price.

Chris,

Yes, if there is money left over its' called the "Boot" which can be taxed. Keep in mind you will be showing down payment, closing costs, and any immediate costs as the fund built into the property. If you have already calculated the actual down payments, Closing costs, and other and still have funds/boot left.

You may want to consider putting more down or doing something that will benefit cash flow like buying down the rate to max margins. Unless you plan on doing a cash out refinance soon because keep in mind cash out refinance is "Tax Free". So if you put "more down" but decided to do a cash out refinance when the LTV will allow that's tax free.

I say this to let you know most cash out refinances under these circumstance are going to go to either renovations, HELOC, Down payment on another REI purchase etc. All of those listed are for the purpose or buying or improving REI. You can discuss with your CPA but I have done this and handled it for multiple investors

John,

Check out Cedar Creek Lake, Galveston Island, Lake Travis for water front properties each one holds it's own story and price point. Great thing about beach front single family is you can buy as a Vacation Home and only have to put 10% down. Vacation homes can be rented out as well which makes them unique and to convert to a LTR just simply refinance in 12-24 months whenever you are ready and transition it from Vacation to Investment.

Usually pull some cash out at that time to use for the next REI purchase so it works out well as long as the LTV is good. You can ensure that with a TLC-buy, walk in equity on a good deal, natural appreciation, or renovations to increase the ARV. Either way as a Second home/Vacation home or investment purchase Texas is a great state to invest in for REI.

Mortgage rates are dropping which means the buyers market is starting to get hot again. Thats means even as of today realtors & Sellers are seeing more offers. Knowing that I would get your financing pre-approval 60 days in advance and ask for a Express Loan approval. Another words get your approval "Fully Underwritten" so your buyer’s agent has a "Loan Commitment" for the approval not just an ever day "pre-approval letter.

Its going to become a tough buyers market in 90 days so having that will help offer the seller a "guarantee" to close in as little as 15 days. Simply ask to rush the appraisal and it will help seal the deal to a quick accepted offer and closing!

Joseph,

Lee County is a great place to buy properties all around Fort Meyers/Cape Coral is really a dynamite spot. A lot of people pulled out and became a little sacred due to a recent hurricane and insurance hikes. To be honest as a Florida resident, Banker and investor in that area it’s a natural cycle so we may not see another hurricane for 10 years. We do not get hit every year but if your new and one hits is can be a little scary.

That being said insurance will be back down investors cannot afford to have a No-Cash flow situation and if homes start selling off the County will get involved and they will agree to balance out insurance premiums once again. This happened years ago after another bigger hurricane that hit premium skyrockets investors sold and got out and Florida re-adjusted premiums back down.

Fort Meyers is a great a lot of vacant lots on the intercoastal still priced in favor or buyers/builds. Homes in certain neighborhoods still in a range from $185K to $285k with cash flow potential. Cape Coral is building every month more attractions, homes, stores, foodie dives and more. Take a look at The "7 Islands Project" that will create a huge market and valuation increase in the next 3-5 years alone.

My advice is use a good seasoned agent get your pre-approval ready 60-90 days in advance and bid smart. Since you and your brother are in NJ you could use this opportunity to buy a home in Fort Meyers as a Second Home/Vacation Home, only 10% down. The home can still be rented and on the second year pull cash out and transition it into a LTR rental!

Feel free to reach out with any questions.

Morgan,

What we call it is a Renovation loan similar to construction but that is saved for "Ground Up" builds. Simple renovation loan would allow for you to convert a garage into a bedroom and allow to build up or build an ADU.

It might make sense to look into simply buying an ADU from the vendor already built as a prefab/modular. That way they simply trailer the ADU you out and adhere it to a foundation/ground. There are some new companies out there called "Tiny home" you can pretty much call them and they deliver the home to your property and do whatever install is needed.

This can save you a large amount of cash based on new construction and also reduce the timeframe from start to finish. You quoted above $250-300K that just seems like an overpriced bid to me but for what's it's worth check out the "Tiny Home" or ADU options where they trailer the unit out and complete/install. Either way you can use a Renovation loan for either of these options and they are generally easy to qualify for especially if it's a Primary or Secondary home.

Last time I checked you can buy a an ADU aka tiny home in CO for starting at $39K upwards of $75K for a 3bed/1 bath. Try typing Colorado tiny home companies there are more than a few just vet them and compare prices. Nothing wrong with an ADU/tiny home not attached to the home. If anything it might offer more privacy and less noise for all parties.

Jackie,

If you can buy outside of NY my first piece of advice would be to venture out of the state of NY. New York has suffered over the last 2-3 years with residents leaving and moving to mostly Florida, Texas, Pennsylvania. COVID was to blame for the most part but like California people are sick of the politics, Taxes, inflated home prices, and every day issues on top.

From a Bankers perspective majority of my investors living in NY & CA are buying in Indiana, Ohio, Florida, Texas, Oregon, Pennsylvania and Tennessee. You can pick up two properties for the same price as one in NY in these other states. Does come down to City/County but its not hard to find what will cash flow.

If New York is your go to spot then yes, White Plains is a good spot only due to the busy business districts.

Depends on the bank or lender....But not if you have an FHA loan already.

To avoid an issue just refinance the property and convert to investment if you have at least 85% LTV. If you cannot yet refinance due to LTV or lack of 6 months title seasoning you can explain in detail. FHA & VA allow for a "Change in circumstance" for example you are moving, changing jobs requiring new location, new school, enlisted military, divorce, other life circumstance outside of your control.

As far a penalty due to no intention as using from the start of the application. That can get a little heated depending on the bank/lender. You can also be added to a "List" or people that banks/lenders use to flag all of your future applications similar to a "Fraud Guard".