All Forum Posts by: Katie Case

@Katie Case definitely house hack again! My wife and I are still house hacking here in Coraopolis with a 3 month old baby!  We'll be on the lookout for the next house hack soon.  Whatever you choose to do, you and Nathan need to stay close so I can have someone hold me accountable, I have not been consistent getting to CrossFit MindFire for awhile now!

On another note, if you're not already, I would strongly recommend working with @Jeremy Taggart and his team!  I can also confirm his lenders above, I used Tony Feola for his 10% down on our current house hack.

@Katie Case

One thing you guys will want to consider if you haven't already is how much you'll be able to borrow to buy that next property.

If you plan on hanging on to your existing place for example, that may lessen the amount that you can borrow for the next property because the mortgage on the existing place contributes to your monthly debt. The higher your debt, the less you can borrow with many loan types.

On the flip side to that, the rental income from the existing place may count as income for you,  depending on how long you've been receiving it and various other factors the lender will look at.

There's a lot of factors to it, but the gist of what I'm getting at is maybe see first what types of loans/financing you can qualify for...  then consider which properties may work best for you based off of that.

Draft up the types of properties that you're interested in, then have a chat with 5 or 6 lenders to see what your borrowing power is... and don't be shy about talking to them or feel like you're wasting their time... that's all part of their job. Good luck!

@Katie Case I'm biased towards 2-4 unit house hacking (I've done 6 lol) but live in flip is a good strategy as well. I always picked the 2-4's since a goal of mine was to build a big rental portfolio and that was the easiest/cheapest way to do that. Also didn't want to pay my own mortgage haha. Wanted to take advantage of those before having kids. 

My GF and I will likely go the live in flip route for the next one since kids will likely be in the picture for us as well soon. You would just have to be more picky with the 2-4 unit with kids probably since area/type of building would play a bigger role than pre kids. I'd say really it depends on your long term goals. If you want to own a large portfolio maybe do another 2-4 unit house hack but if you just want a small portfolio you could do the live in flip if there's money to be made. Also we do have lenders here in Pittsburgh that do 5-10% down on owner occupied 2-4 units outside of the FHA loan as far as house hacking options once you've used your FHA up.

Hard decision!  I would say with the single family home, it sounds like you can force more equity there, and I am also assuming that the multi family is more one bed one bath units?  If that is the case, going for the single family you are really winning financially and personally.  You can rehab and fix it up and then start your family there because you have the room.  Then when you are ready, you buy another place and either sell the single family or turn it into a rental and have the memories of where you started your family.  It could become your 'kids house' in the sense that in 18 - 20 years, and it is almost paid off or fully paid off, and you have money for whatever their future endeavours are.    All in all, it sounds like the single family would tick off multiple boxes for you and your current situation! 

I would be looking at this more from a personal/lifestyle perspective than I would from an investment perspective. If you plan to grow your family in the next year, and you know you'll need the space, then I would be looking to upgrade my living situation sooner rather than later.

If you start looking now then you will have plenty of time to find "the one", and to renovate it before the baby comes. If you wait until you need the space (e.g., you get pregnant) then you're going to be rushed and feel pressured to overpay.

I don't have a full financial picture of your situation or these properties, but it sounds like Option A is the way to go. Buy it under market, put in the sweat equity over the next year to make it "yours", and enjoy the space as you grow your family. 

Good luck!

What would be the long term goal with option A? Rehab while living in it and rent it out after a year or more of a live in flip to sell in a couple of years?

Option B is going to come with a higher down payment as an investment loan. 

Adding extra doors is always good, but if the single family is a rare and great deal you'll be able to force equity there.