All Forum Posts by: Jim Piety

@Timothy Douglas thanks. Yes, I agree that leveraging is ideal and I wouldn't do a HELOC or HE loan immediately. If it's a SFH that I plan to live in for a year before renting out, does that count as house-hacking?

@Rick Reeder, Yes, I plan to move in but it's more of a primary residence than a duplex. Although I am looking for a duplex if I can find one. But can you help me understand the 80-15-5 or 80-10-10 that you meant? I get the 80% loan, 10% down. Where does the other 10% come from? Private or hard money?

@Michael A. Are you concerned that selling the property with existing tenants violates a regulation? Or are you trying to see if an eviction is okay in order to sell? 

The way I see it is that you've done the hard work for an investor by already having tenants and proving what the house will rent for. From a buyer's perspective, I would be wary of month to month. Why do the tenants not sign a longer commitment? 

I can't imagine California would be against you selling the property with existing tenants. It's a tenant-friendly state that would probably prefer you keep the tenant in place.

Does that help?

@Becca Summers What about a primary residence in a quickly appreciating market (Austin)? Even if it wasn't a primary residence, finding cashflow in Austin is nearly impossible. 

Thanks for your response @Greg Scott. 

What I meant was if I have the option to pay 3.5% on a property vs 20%, which is better. If I put the full 20% down, I have a lower payment but my cash is also tied up in the property. So, I am inclined to just pay the minimum and use the remaining cash to buy an investment property. Alternatively, could I not pay 20%, get a lower payment, then use a home equity loan to buy an additional property. 

Does that make more sense?

Considering money is cheap right now, it makes sense to borrow as much as you can. However, a larger down payment reduces the monthly payment and helps increase cashflow. Plus, if you have a larger amount of equity, can you not pull the money out with a HELOC to invest in additional properties?

I understand that a HELOC is not free, like cash. But I'm curious what other investors' thoughts are.

My specific example is comparing 3.5% vs traditional 20% down for a primary home. So PMI leads to a large amount of savings. But, this question is applicable to 20% vs 30%.

Thanks!

will be out of town. Would love to catch y'all on the next round

@Nick Marrone @Jordan Moorhead, I like the East Austin area quite a bit. Both MLK and east of 183 are key spots. I am a little concerned with crime/safety. I live out in Cedar Park and while I am technically not a first time home buyer, my girlfriend is and is looking to partner with me. So I anticipate being able to use an FHA loan or something similar.

With that said, my gf is not an investor or handy and so the idea of buying a fixer upper scares her. Heck, a large project scares me too. 

I do like the idea of finding a duplex but those are rare.

@Dan Weber that's good advice to validate with the lender. Good idea! 

The one challenge I know I am expecting with a multi-family (besides the $$ required) is that my gf is totally against it. Trying to convince her but we'll see.

I am looking for some help to make a decision on my next purchase. I live in the Austin suburbs but in July, I will have to begin going to the office again. Rather than suffer through insufferable traffic/commute times, I'm considering buying a home closer to the city. 

With the appreciation in Austin, that seems like a positive decision. What could go wrong?

However, I also want to invest in cash flowing properties and don't want to dump all of my cash into one appreciating property. So the trick seems to be finding a property that I can afford AND leaves me enough cash to also invest into a second property.

My question is would you approach this differently? Am I thinking about this in the right way or is there something that I am missing?

Thanks!

@Paul Sandhu

As a former chemical engineer, I approve this message 👍🏻😉