https://www.youtube.com/watch?v=wAIw7FtgQLk
https://www.youtube.com/watch?v=i1aKl1vxMag
Okay, so you want to buy an investment property, but you don't want to live in it, so FHA is out. Okay, cool, so what would I suggest? Generally, I'm more of a 25% down girl. There are some times you can do 20%, but usually the rates are so appalling, you want to do 25%. And what I like, especially in a market like this, is you can ask the seller to cover up to two percent of your closing costs, so that can help reduce how much you're having to put in the property up front. So that's my fave for if we're going conventional.
You're not going to live in the property, just a very basic vanilla Alone. Um, we can count projected rental income in most cases, so it's a great way to get in the door.
Okay, so today we're going to be talking about investment properties. And you don't know this, but I have not been sleeping at all. I might have had a whiff of that, really. Is it the bags or just the fact that I've been a little bit on edge? For anyone who's called me recently, and you guys are like, "Ooh, she's..." Mmm, she's... bro. I'm tired, guys. I'm tired. I've been waking up at 4:00 a.m every single day for three weeks. Yeah, and I can't get back to sleep. It's a problem, and the problem is stemming from, I'm selling, I'm looking at selling one of my investment properties. I've got it staged, we're getting ready to list it, and I'm going to be doing a 1031 exchange. A 1031 exchange is a way to take your profit and put it into another property and not get murdered in taxes. But what kind of property can you do it? It has to be an investment property. So, it's not like I can take the money from that house and pay down the mortgage on my house. I would love to do that. That would be dreamy, but it's not the way it works. And the trick with it is that once the property you sell closes, you have 45 days to identify another property. That's quick. It's really quick. So, it's pretty stressful because you don't know if your house is going to sell.
I was reading an article. I don't know if it was Fortune... Ugh, I shove it down. It was Fortune, Forbes, and it said that we actually are at the 40-year lowest amount of inventory, lowest inventory in 40 years across the country. I'm sure everyone can believe that. Yeah, I just did nine. I don't know what that means. So, 40 years, and so it's very stressful. And I thought I had it all put together, but then Julie and I have been talking to a bunch of different investors because we're looking for some new programs because people keep on asking for stuff. And we're like, there's got to be this and there's this program.
So here's the deal, investment purchase. You are qualified off of your credit report, whether the property cash flows, and your down payment. Basically, if you have... And I don't have the credit scores right in front of me, but if you do 20% and the property cash flows, that's all they look at. They're not looking at your income. They're not looking at your tax returns. They're not looking at anything. They're looking at the down payment and if the property will cash flow. That's a great program. It's so cool. And the rates on it are like... Either a little bit higher than if you do full documents, for sure, but it's a 30-year fixed loan. You know, the fees on it aren't bad. Like, it's cool.
And then the other thing is they have a 25% down. So, 25% down for that one. I know credit has to be over 700. It doesn't even matter if the property cash flows. That's awesome. Yeah, I mean, and it sounds like sometimes people were like, "Oh, predatory..." Boom, guys. It's a 25% down payment. That's a lot of money. It's not like people are buying investment properties with like a bag of popcorn and chips. Um, that would be delicious. Yeah. It's a 30-year fixed, so, you know, amazing. And so, ever since we had that call, I'm broken because I thought I would just be buying like maybe one more investment property. But now I'm like, "Oh my God, I could get, you know, potentially four houses here, or should I get one in this state, and one in this state, and one in this state?" And guys, this is really an investment video. So for anyone who's like, "I hate you. I can't buy one house," this is an investment that I made that because of where the market is, there is a good amount of profit from that investment. That is where this money is coming from. So I'm going to be very clear about that. That is why people are always telling you to invest in real estate. Okay?
Anyway, so my mind's blown. I can't sleep. Your mind's going a million different directions all day, too. Too many options.
Well, and then we talk to people all day. And since I'm licensed in 47 states, people are always telling me how awesome the areas they live in. And then I look at the areas with all you guys, and I'm like, "Oh my God, this is an awesome area." And I sell myself houses all day. That's why you're up at four in the morning.
Yeah, because you live in 47 different cities.
I live in 47 states with you guys in your mind. I do. I do. I do. It's really a problem.
So how are you going to get it under control?
I don't know.
Okay, well... Okay, so the first thing I tried is I did a list because I am looking in the entire country, and that is mind-blowing. Okay, the amount of time you can spend on Zillow, like your eyes go dry. Yeah, it's that bad. Yeah.
Okay, so what you guys, if you guys are looking for a rental property, you can also do this with if you're going to be buying a house. And if you're head spinning, if you keep on expanding that search area, okay? We all know how to do that with our fingers on Zillow. This is for you. Okay, so my list has three categories: have to, meaning that the property has to meet these requirements; no, meaning if it has any of these issues, I'm out, bye; and then ideal, okay? And what you're going to do is you're just going to write down, you know, close your eyes, think about it. What does the property have to have?
Okay, now I'm thinking about an Airbnb. That's my goal. And I did recently join a Facebook group of Airbnb owners because it's very interesting to see the challenges they come up with. Interesting. Oh, it's scary. It feels like that's a whole nother... Oh, that's a whole other video. We'll talk about that. Um, anyways. So, and you guys can fill this out as you feel fit, but like, so for mine, I did it needs to be at least two bedrooms, two bathrooms. Um, it needs a deck or outdoor area because I know when I'm looking at Airbnbs, I'm always looking at like, okay, what's the outside space for entertaining, for social, always for... Yeah, yeah, for getting a break, for, you know, barbecuing. Um, it needs to be an Airbnb destination. So what that means is I want a market that's already been established. I want the community to be used to Airbnb. Um, and I don't want to reinvent the wheel, right? Um, the other thing is within 45 minutes of an airport. Um, you know, most destinations are going to be within 45 minutes, maybe an hour and a half, but if it's... I was looking at houses this morning, five hours away from an airport, up a windy road. I get carsick. I couldn't even visit the property. No. And it was like four times my budget, so X that town off your list. Yeah. Yeah. I just need to keep that state off my list. Yes. Yeah. Okay. But we have a client that got a great house there. That's where this all stems from. Like, he got this beautiful beach house in Oregon in Lincoln City. It's gorgeous. Okay. I got to stop it for this. This is why I'm up at four in the morning. Okay. And then low crime. Um, my question for you. Yeah. How much time do you spend researching sex offenders? Oh my God. All day. No, I... I mean, if it's somewhere I'm going to live, I... I mean, I check... I check Hillsboro, like, monthly. Monthly. Just because you want to, you know, you just want to make sure that if someone's, like, constantly biking by your house, looking in your windows, that you can be like, "Oh yeah, we better get a big dog." Can I... I'll just borrow your dog. Yeah. You know? Muppet, wherever she is. She's lurking about here somewhere. She's my... Your dog will get the job done. Your dog will get the job done. And then it will have, like, an arm, like, in its mouth. And it will be, like, "Pety." She's a sweet lover. Actually, she has a trained German shepherd that probably the military wouldn't even accept because it's too aggressive. That is not true. She's a sweet angel. She's just very protective. Yeah. Okay. Um... Okay. I actually haven't met this dog in person because I'm afraid to. Her last dog, which she said wasn't a pit bull, but it was, it used to eat... It used to gnaw on my foot. And she'd say, "Oh, it's just confused. It's colorblind." It was three months old when it was my foot. It nibbled on my foot and it was the best dog. This is... This is not a normal... For the record, I mean, nibble. Full lover. Not a nibble. Okay. Sorry. Um... Okay. I don't know how we did dressed into the cars. Oh, sex spinners. Okay. Got it. Um, the big thing for me is I don't want any rental restrictions. And if you guys are looking at investment properties, especially Airbnb, that is so important. A lot of real estate agents do not talk to you guys about this, but there are towns where you cannot do short-term rentals. And you can be fined heavily. People buy into those towns without realizing that, and they end up with a long-term rental that does not cash flow, and it's hard to find out which communities you can do under 30-day rental zone. Yeah. Oh my gosh. I was on... I was on the websites this morning, looking up counties. Does this count? Sorry, guys. Does this county, you know, allow it? And what was so annoying is I've gone to a website that's supposed to, like, give you all this Airbnb data, and I typed in our town because I was testing it, and it's like, "Oh, here's all the money you would make." Our town banned short-term rentals. Like, you can't do it. So you have to go directly to the towns and cities. You've got to go to the county websites and look up the short-term rental laws.
So, very important, so if it has restrictions, I'm out. Um, I don't want high HOAs if it's a condo, very important. I'm also looking, like one of the areas has been Florida, so I'm looking for newer buildings because of that horrible tragedy, yes, ugh, you know something to think about when you guys are looking at properties. Um, I don't want to remodel, I've been there, done it, don't want to do it, and you're not going to be on site very often anymore, no, no, no. And if it's a high crime area, I just can't, got it, yeah. So, you've made your list, you're focusing, you've got your hat you have to have, you've got your no ways, now based on my list and my budget, I'm only going to be able to afford a high crime, um, let's see here, five-hour drive from the airport or it's not like one bedroom, yeah, with one bedroom and half a toilet. So half a toilet is a hose and a bucket. I actually saw something very similar to that this morning, okay, it was six hundred thousand dollars, wow, yeah, don't doubt it, yeah, it was in Oregon. 40-year low of inventory, I bet someone's buying it, 40 love inventory, and then, yeah, I actually, I need to add another no, falling off cliff, that's a big one with waterfront, guys, there's a lot of houses falling off cliffs, that's the thing, erosion, and then I've got my ideal which is three bedrooms, a warm climate, and a growing job market, okay, yeah. So, you know I've got my list, I'm hoping this is going to help me sleep. If you guys are looking at properties and trying to figure it out, you know having some clarity here, the nice thing about this list is it took me from looking at 25 states to right now I've got four listed, and then I got to put New Mexico in there, okay, I know it's, it's not waterfront, so I'm gonna put this as like, let's all give ourselves one, what do we want to call it, um, outlier hot wire state, okay, so we'll do an outlier because my dad lives in New Mexico, so I was like, oh I should get a place by my dad, and then Airbnb because Santa Fe is very popular, and then I can go visit him in the desert, in the desert away from the water, not waterfront, because let's note Jennifer is a water person, I'm a water person, yes, yeah, I have nothing by the water. So I have a question inside these lists, yeah, do you, you've looked at Zillow a lot, I want to kill myself if I look at Zillow, so, now that you have your list that has your halves, your no ways, and your most ideal characteristics of a property, do you set your filters according to your list when you're doing your initial searches or do you just search everything?
We all know me, I mean, I spent an hour today in Vermont, I didn't type in a town, I typed in Vermont, okay, and then I was like, it's probably good to be near the Canadian border, like, that could be useful, yes, yeah, yeah. No, so I'm going to set up, okay, so I'm going to set up my search tonight, today, tonight, because I got to work, um, I'm going to set up my search, and I'm going to limit it to, are you guys ready, you guys, no one, no one's still on for my die-hard friends, hey guys, I love you, um, Myrtle Beach, Hilton Head, the entire state of Florida, whoa, well, okay, I'm focusing on, okay, I'm gonna hold on, oh god, my eyes hurt so much from the Zillow, okay, I'm looking at Lake Nona, client suggestion, he said this is the most magical place that he's ever been to, and I have been talking to people for 15 years, I have never in my life heard an area that was so transformative to someone, so Lake Nona is on my list, wow, they also have a great VA hospital, I'm hearing, okay, um, okay, Destin, Western Florida, Destin, Florida is a big, it's a big, I've heard about it for many years, okay, so Destin or Miami, let's cross Miami off the list, okay, Miami's dead, Destin or Santa Rosa Beach, I would have to research, I'm going to say, let's go with Dustin, okay, so we're going to do Lake Nona in Destin, although I have to say, I may open it up to, Disney has some Beauty and the Beast houses, this is real, I'm not kidding, it's called Royal Oak, I'm gonna put Royal Oak on, and can you put Sarasota on there, why are we doing Sarasota, it's really beautiful, it would be a fantasy destination, it would be a reach spot for you, isn't it like party central for spring break, isn't it like all phones and shots, no, it's beautiful, okay, so it's classy beautiful, I do not belong there, okay, so we're gonna do Royal Oak, Dustin, Lake Nona, and Sarasota, and then the fourth place on this list is Washington State, um, the islands, okay, Bainbridge Island, and then it's like Whipple or Whittle, or do you know what I'm talking about?
Did you have, was warm climate one of the ideal items on your list, I okay, we're gonna cross off Washington, but they have no state tax, but it's a rental and I'm not living in it, okay, exactly, okay, bye Washington, bye bye, we love Washington, but she's right, and I get sick on ferries, so if I ever wanted to visit my Airbnb I couldn't because I'd throw up, okay, so we've got Myrtle Beach, Hilton Head, parts of Florida, and then our outlier is Santa Fe, New Mexico, excellent, okay, so guys, we're going to be doing a couple of things this month, it's going to be an investor month, so we're going to be talking about what a 1031 exchange is, going into detail on it, I'm going to be doing a call with Jeb Smith, you guys may watch him on YouTube as well, he's going to be saying his top three tips for investors, we're going to be talking about more investment loan programs, but that 25% down and not having to really show anything magic, and then we're also going to be talking about staging, god, what else, anything else with investments, I think we should do a video on how to keep your mind straight when you're looking for an investment property, okay, and then we're going to be doing a coaching session where Julie tries to talk me off a cliff, because clearly I will spiral for the next 30 days, yes, yes, okay, so guys, if you need a mortgage, if you want to talk about the state that you live in, if you want to take me for a spin in terms of mentally, give me a call, licensed in 47 states, Julie is our California queen, we are here to help you guys with mortgages, we know the mortgages inside and out, if you're an investor that wants to talk about some of the great programs, oh my goodness, let's talk, thanks for.