All Forum Posts by: Michael Moreno
Michael Moreno has started 7 posts and replied 46 times.
Post: Introduction and Open to Connecting!
- New to Real Estate
- San Antonio, TX
- Posts 46
- Votes 20
Quote from @Justin Brickman:
For sure! Welcome Michael and would be happy to connect with you
Thanks man!
Post: Introduction and Open to Connecting!
- New to Real Estate
- San Antonio, TX
- Posts 46
- Votes 20
Hi everyone,
My name is Michael, and I recently bought my first property in San Antonio, TX. I was looking to see if anyone wanted to connect on LinkedIn (in my profile) and through here. I am also very much of a people's person, so I'd like to grab a coffee in-person with anyone that is in San Antonio to discuss more about real estate and build a better relationship!
I am very passionate about creating long-term generational wealth for myself and my future family. My parents were teachers and never were able to give my brother and I much of what they would've liked for us to have. That has really motivated me since I started college to major in finance, learn about investing, and set a goal for myself in life.
I hope this finds everyone well and that you all are having a great day. Again, let's connect!
Post: Closed on my First Property at 23-Years-Old - Seeking Advice
- New to Real Estate
- San Antonio, TX
- Posts 46
- Votes 20
Quote from @Jonathan Pflueger:
Of course it is! Rent out the rooms, sign leases, and keep the money coming in even when you are traveling. I am not up on the laws in your state, but as far as I know renting out the rooms in your primary home (emphasis on primary) does not negate the Homestead Exemption.
Search “house hacking” on the BP forums. This is one of the best strategies and most creative for creating income from nothing (well not nothing, but from something that was not there before in its original form). Think buying a 5 bedroom home split level and then separating the home in two homes - boom you have a duplex and and an additional rent source. Or just rent out the 4 bedrooms you are not using, although this works best in college towns or other similar areas.
Bottom line, for someone you age the sky is the limit when it comes to this sort of out of the box thinking. Property is an income driven (income and equity) asset, finding its “highest and best use” is your goal. When you point this at your living situation you would be amazed at what you can figure out.
Thanks Jonathan. I am planning on house hacking my two rooms as soon as I can so that I can make use of those two vacant rooms I have.
In regard to the Homestead Exemption, I meant to say that if I decide to write-off expenses for tax purposes, I'd lose the exemption since I cannot have my primary residence as an investment property at the same time. It's either one or the other. I think I'd also have to establish an LLC, and I've researched that it's much more beneficial to keep my home as a primary residence since the Homestead Exemption is very much more helpful.
Post: Closed on my First Property at 23-Years-Old - Seeking Advice
- New to Real Estate
- San Antonio, TX
- Posts 46
- Votes 20
Quote from @Travis Timmons:
First step - get two roommates to rent out the bedrooms that you are not occupying. I'd furnish them and put them on airbnb and furnished finder for a minimum 30 day stay (unless you want to do short term rentals by the room). Start with that, don't pay extra on the mortgage, pile up cash for the next one. If your goal is to get into the next house/2-4 unit, save for a down payment rather than throwing money at the principal to eventually borrow against it via HELOC. You're in the scaling phase, not the paying down principal stage.
Beyond that, work your a$$ off and save every dime that you can. If it's not food, transportation, housing, or ABSOLUTE necessities, don't spend money on it. And do everything you can to make extra money. You have to think long term and delay gratification. My 20s were a blur. I didn't go out with my buddies, go on trips, buy a new car, or do any of the other admittedly fun stuff that my peers were doing. I did nothing but work, but now I'm financially independent at 41 with no job. It was worth it. It completely and absolutely sucked, but it was worth it.
You're in a good spot, but it is going to take longer than you think it will. Slow and steady still wins race. Feel free to send me a message if you think that I can be a resource. I have nothing to sell and would be happy to help.
Travis,
I can't begin to thank you for these words of advice and wisdom. This is exactly what I've been doing. It really does suck a lot. Not having a ton of friends to do stuff with and sacrificing those expensive things and events you want to have for what you desire in the future. I hope this strategy works out for me in the future. I have been very frugal with my finances since I graduated back in May 2023.
To start off, I'll take your advice on saving money instead of prepaying towards the principal. I take home $4k a month, so I am doing my best to make use of that money. I actually furnished all the rooms already back when I bought the house, so I've been trying to list my rooms on Airbnb. I'll also check out the Furnished Finder website.
I will send you a message so we can stay in contact. I really appreciate your advice!
Post: Closed on my First Property at 23-Years-Old - Seeking Advice
- New to Real Estate
- San Antonio, TX
- Posts 46
- Votes 20
Quote from @Jonathan Pflueger:
Your proactive approach to building equity in your first property is a solid foundation for an exciting real estate investment career. Since you're interested in expanding your portfolio, the BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat) could be particularly effective. This method involves purchasing properties that need work, rehabilitating them to add value, and then refinancing based on the improved value to fund additional investments. If done right, you can refinance at the end of your rehab and pull close to, if not all of your money invested in the property (down payment + rehab cost) and then buy another house and do the same thing. Over and over again. It's slow but it can build an amazing solid foundation that will lead to other even bigger investments.
It's a powerful way to grow your portfolio while leveraging the bank's money, and if done right, you can do this over and over again. I know some investors that buy and move to a new home every year to do this. This strategy starts to compound when you find homes that have an ADU (accessory dwelling unit, casita, bungalow, etc…) along with the main house. Think duplex without the multi-family title.
However, given your stage and goals, you should also consider house hacking, especially since you initially considered a multi-family property. This strategy involves living in one unit of a multi-family property and renting out the others. It can significantly reduce or even eliminate your living expenses, allowing you to save more towards your next investment. This approach might be more immediately accessible and less intensive than a full BRRRR, given your current situation.
Keep it up, your effort and drive is gonna pay off huge!
Hey Jonathan,
Thanks for the feedback. I've not done much research on the BRRRR strategy, but I will research it more. It sounds very lucrative, and I think I'd need to have some construction/builder knowledge to understand how to rehab a property. I'd probably need a mentor too.
The second alternative you stated is indeed less intensive than a BRRRR given I have a full-time job that is highly travel-intensive. I travel 50-75% of the time every month.
Is it possible to house hack with my current property since it's a single-family residence? I know that I can't utilize it as an investment property or I'll lose my Homestead Exemption.
Post: Closed on my First Property at 23-Years-Old - Seeking Advice
- New to Real Estate
- San Antonio, TX
- Posts 46
- Votes 20
Hi everyone! My name is Michael and I am seeking advice on how to go about my first purchase.
I bought my first property as a primary residence for $258,990 with an FHA loan at a 4.875% interest rate. It's a one-story single-family residence with 3 beds and 2 bathrooms with only me living there. I was not able to buy a duplex, triplex, or quadruplex since the mortgage would've been more expensive, but it was my first idea. I have been prepaying $1000 for the past four months since I closed on it. My strategy with this is to build equity as quick as possible so that I can apply for a HELOC, Home Equity Loan, or do a cash-out refi to buy my second property (investment property) if rates end up falling in the future. I would also save a huge amount on interest and pay the loan off in 12 years if I continue this strategy. If I were to buy my second property in the future, I would ideally like for it to be a duplex, triplex, quadruplex so that I can move into one of the units, rent out the others, and also rent out my first property fully.
After doing more thinking and math, my other strategy is that I could go invest that $1000 into the market (which makes me a higher return than 4.875%) as well as rent out the two extra rooms that are currently not to aid in paying off my mortgage.
I am wondering what y'alls thoughts are on these two strategies? Also, please be completely and brutally honest with me because I really want to be a successful real estate investor. My dream is to own many long-term rentals. Please feel free to also connect with me on my LinkedIn (in my profile) so we could discuss more!