All Forum Posts by: Ron Gallagher

I was a pioneer and moved to Columbia Heights in 2003 (years before Target would open) and bought a rowhouse there and I house hacked it with some roommates.  Within a month of moving into the house it was broken into and crimes were committed to me and around me on a daily basis. It was a constant stressor that dramatically impacted my quality of life.  I vowed to never live in a transitional area again.  The property has appreciated nicely but  if I had to do it again I would have paid a higher interest rate and just rented it out as an investment property and let someone else deal with the neighborhood riff-raff.  

You can still get appreciation in nice areas and not be subject to crime on a daily basis. If you insist on living in DC then maybe Ivy City would work out since there is a lot of development planned there but I would get cameras installed, adopt a big scary dog, and put bars on every window, door and skylight before I moved in.

How long would it take you to save up $11k? You could take out a credit card cash advance for a 3% fee ($330 on $11k) and ask your current credit card if they have a 0% APR option for 12 or 18 months. If you are a responsible user of credit cards and you were confident you could pay off the $11k credit card bill in less than 12-18 months I would just do that. Using the $225 a month you would be saving on PMI and paying down the $11k credit card balance would get you almost halfway to repayment right there. $225 x 18 months = $4050

Also I would look at what your 401k is invested in. If you are talking about 3% so far this year or last quarter then that's OK... but an annualized 3% return is pretty poor performance.  

 Maybe you can get God to co-sign on the loan

This is true in most of the United States, but Miami is not your typical U.S. city.  I have so many friends from Argentina and Brazil and the rest of Latin America that have been to the U.S. but have only been to Miami.  They go to Miami to shop for cheap clothes and buy a few iPhones for cheaper then they can in their home country, maybe buy a condo in Brickell to stash their money because they don't trust banks in their home country, and then fly home, never seeing any part of the U.S. outside of Dade County. 

I think this massive mall/tourist destination in Miami is a brilliant idea. If you search the web for "things to do in Miami" there's not much. After you tick "going to South Beach" (which isn't even Miami proper, it's the City of Miami Beach) off the list there's really nothing more to do other than shop.  

NASA FCU offers no down payment mortgages, and you don't have to join the military to be a member.  Just donate $35 or something like that to some space society and viola! You too can have access to no down payment mortgages.

I also live in a beautiful rowhouse in DC, although I'm the one living in the basement 1 bedroom inlaw suite and rent out all of the bedrooms on the upper levels. I live for free in a very nice DC property and my housemates pay enough in rent so I cash flow $1600 a month. Who says you can't cash flow in DC?

Also, in regards to DC appreciation, I bought the property in DC and it has appreciated 15% (if you believe redfin's estimates) and 18.25% (if you believe in the zestimate) since I bought it about 8 months ago.

So you can have BOTH appreciation and cash flow in DC if you buy in the right area and if @Russell Brazil is your agent so can he negotiate $50k off the sale price even in a seller's market.   

 It is my understanding that TD Bank, Wells Fargo, and Pentagon FCU all offer HELOCs on non-owner occupied properties.

Long term buy and hold is a way better strategy then flipping if you think we are at the top of the market. 

Great job! My favorite part of this story is that the professional property manager said that you wouldn't get $1100 for rent and you got $1200 doing it yourself. HA! That's great.

Also if you started the rehab in September and hired a contractor to help speed up the process then the house may have been ready to rent in the December/January timeframe. That is the worst time to try to find a tenant. So by doing the work yourself at a leisurely and less stressful pace you extended the rehab time and then you were able to rent out the house at a time of the year that is most favorable for finding tenants. Also you learned a lot about how long it takes to do a job so in the future when you hire a contractor and he tells you it's going to take two weeks to lay flooring you know that's too long and you won't get ripped off. Also, since the rehab took seven months you already met the bank's six month seasoning requirement so I would say you did this the right way all around!

 This is exactly what I would recommend doing. House hack by buying a move in ready single family home and rent out all the bedrooms to roommates.  If you buy a multifamily property and house hack that way you will have to be a landlord for the other units which could consume your time. If you buy a house and live in it with roommates then you get a little practice being a landlord (dealing with roommates as tenants, dealing with home repairs, etc.) and it wouldn't consume as much of your time. You could potentially still live for free (your roommates pay your mortgage, taxes, insurance, expenses, etc.) and you are building equity at the same time by paying down your mortgage and you don't have to live with your parents.  Then after a year or two buy another house and rent out the 1st house behind you and get new roommates for the next house and repeat until you are financially free.