All Forum Posts by: Zachary Shelley

I have a client who is doing it and did well. He bought back in 2020 of a SFR with an ADU. He and his family live in the main house and the back unit is rented.

The process of house hacking is fairly the same, it just comes down to the numbers. 

I've house hacked a condo and a house with ADU (built it out with the FHA 203(k) loan). It's doable depending on the location.

Do you have any specific questions related to the process? The VA loan can be tricky when buying condos because you either (1) have to make sure the complex is VA approved or the Seller is willing to allow a spot approval or (2) you can sign a waiver but once you do that you cannot do it for any other properties going forward.

Hey Zachary - I'm actually in the same boat as you. Currently looking for a SFR that has ADU opportunities whether that be a garage that can be converted or enough space in the lot for a free standing unit to be built out. I'm definitely seeing the market cooling down in our area (LA county) and I'm sure some great deals can be found. Will be following along in this thread...

@Zachary Shelley nice! Smawt. My first two house hacks were rent by the room. I converted a garage into a STR that I managed while living in the house and renting out three bedrooms. They worked really well and still do to this day. This is one way to maximize a home's rental potential.

Hi Zachary,

I think it's a great idea! Let me know if you need any help locating FHA approved listings or need help with pre-approval. You might also consider a duplex, triplex or fourplex so you can reach your goals faster and have more privacy. Some of these duplexes can host an entire family and command much higher rents!

The self-sustainability rule doesn't apply for VA loans, only FHA loans to my understanding. House Hacking with your VA loan is a great idea, there are some difficulties that may come along with getting a seller to want to take a VA loan offer vs an FHA or Conventional, but my team has had good success doing it. Hit me up with any questions. I house hacked my first house before it was called house hacking and it's a great way to save up for your next house and reduce housing expenses.

Hey Zachary, 

Have you looked into SFRs with an ADU? You can use 75% of the expected rents to qualify for the loan.

Where in LA County are you looking? Also what have you been approved for? 

@Zachary Shelley

We can’t believe how many owners hire the first PMC they speak with!

Then they complain their expectations aren’t being met!

In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

It's often a case of not doing enough research, as they don't know what they don't know!

Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator – and they often select the first PMC they call!

So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.

EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

This also leads owners to ASSUME simpler is better when it comes to management contracts.

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.

We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:

https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes

Even if someone give you a referral, don’t make the mistake of assuming the PMC will meet your expectations, just because they met the expectations of the referral source.

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

Please send us any feedback via email, as we do not use the DM feature here.
Also, if you like our response, please don’t be shy about giving us a vote😊

What areas are your properties in?

McCaw property management without a doubt! @Kevin Coco-Senyszyn is the guy to work with as well. I’ve referred as well as done a lot of business with Kevin over there. Never had a bad experience!