All Forum Posts by: Manco Snead

Greetings all,

I’m hoping to get some feedback on the definition of owner occupied. Example: I buy a single family with a conventional owner occupied loan. Then I want to house hack. Where do I need to live on the property? If I convert the detached garage and live in it while renting out the house will Fannie and Freddie be paying me a visit at some strange hour of the night?

Much thanks.

Greetings good people,

Relatively new investor looking for templates of WA State P&S Agreement for the purpose of understanding what I will be signing when I buy. When I purchased my first rental property I was blindly signing paperwork; everything worked out, but I want to educate myself for next time. I am looking for everything one would sign when buying a single or multifamily residence with a conventional loan. Any ideas where I can find these docs?

Much thanks.

Greetings good people,

During these times of low inventory and high selling prices I would like to raise the question of whether or not the market actually cycles as is sometimes said. I have read about the 7 year cycle, but is it true? Or do market values not so much decrease as simply plateau, as the below graph may suggest. (The big crash being the strange exception.) Or am I missing something? This graph is from an article (Historical Home Prices: Monthly Median Value in the U.S. from 1953-2020) from website dqydj.com and states of the graph "This data uses the non-seasonally adjusted housing price index data from Robert Shiller and the FHFA to mash up these values." I have no affiliation with this website.

Would like to hear other peoples thoughts on the topic as it relates to the question "When is the right time to buy?"

@Chris Levarek   Thanks for your feedback Chris. Yes, I understand a cash out refi would decrease cashflow, but create a greater overall net if I correctly reinvest the cash out $ elsewhere. It gets a bit unclear to me though in that reinvesting cash out refi $ seems to increase my debt while the cash equity in my duplex is still just sitting there and could used to achieve the same acquisitions, but with less debt and more cash flow. I understand that the cash out $ is still working for me, but can it be as advantageous as selling? Just raising the question and I know there are many variables in the equation.

I'd also be curious to know your thoughts on HELOC vs cash out refi in a situation like this.

Much thanks.

@Jaquetta T Ragland   That is the big question; in my area I would answer your question as no. The only way I see to beneficially trade up is to buy far out of the area, probably in a different state.

@Bill Brandt  Much thanks for your thoughts. My gut, at least now, tells me to keep the property for the reasons you mentioned; I know the area/market and it's always performed very well.

My plan prior to my thought of selling was to cash out refi, but then interest rates crept up a bit and a new lower interest rate would only save me $110/month if no cash was pulled out. I'd therefore switched my thinking to a HELOC to save on refi costs. I've never done a HELOC; would be interested in your thoughts on the HELOC vs cash out.

Thanks again.

@Joe Villeneuve Much thanks for the feedback; I see your points and they make sense. A $1.675M property could be very good in a market less expensive than the western Washington market my duplex is in. Going to have to do some math and research. Would you immediately reinvest or would you wait (presumptively) for the market to come down a bit?

Greetings good people,

I'm looking for some feedback on the decision to sell or a hold a duplex I've had for 6 years. In short, it cash flows very well ($1000/month, partly because I put 40% down), is in a desirable and growing town in an excellent neighborhood with increasing rents and I have never had problems getting tenants. The market has become very inflated. 

Price paid for property: $265k

Potential selling price: $600k

I hate to mess with a good thing in considering selling, but I am wondering what the most advantageous strategy would be. An implication of selling is that to reinvest I would need to buy out of the area, likely out of state.

Any thoughts are much appreciated.

Greetings good people,

Another "How would you invest the money?" question.

Cash reserves for investment $60k

Pre-approved loan amount: $400K

My situation: Currently renting and looking to buy something that will be my primary residence and hopefully also a rental situation. Average market value in my smaller western WA town: $350k. Sales and rental market extremely difficult with much competition and inflated numbers for both sales and rentals. I'm considering building an ADU on the property, or renting space for a tiny home or two, etc. Actual multi-families are basically non-existent. My primary residence requirements are not much; a small and simple fixer is what I'm hoping for.

From an investment/ cash flow perspective how would you spend the above amount of $ given also wanting to satisfy the primary residence requirement?

Any thoughts, inside or outside the box, would be greatly appreciated.

Thank you!

Greetings all,

I'm hoping I can get some feedback from those more experienced than myself. I am looking to buy a small house and ultimately have an ADU built on the property. However, if there already happens to be a detached garage, pre-existing ADU, or something similar then the scenario changes. Without any pre-existing outbuilding I will need a construction loan to have an ADU built. With a preexisting structure in decent condition I can likely convert it myself with my own cash and not need the loan.

I have never dealt with construction loans, but know that I want the home and construction loan to be combined into one, to avoid having to pay off 2 separate loans.

So, in the whole preapproval process I am not sure how to approach this as I may or may not need the construction loan, depending on what I find. I am in a difficult market with few options and competition.

Any thoughts would be much appreciated.

Thank you.