Welcome to short-term rental riches will discuss investing in real estate but with a specific focus on short term rentals quick actionable items to acquire manage and scale your portfolio I’m your host Tim Hubbard.

Welcome back to the short-term rental riches podcast thank you for joining me once again I’m glad you’re here and today we’re gonna talk about what is the absolute most affordable way to get started invest in real estate that I know about and what is the easiest the 2 worst sort of connected but it doesn’t necessarily mean that it is the best route so let’s go ahead and jump right in I end this is going to pertain.

I merrily for those that are in the US because we’re gonna be using financing with the strategy but essentially the cheapest way I’ve found to get into a property as a short term rental investment is to buy a multi unit property that’s also your primary residence. And if if you listen to a lot of real estate shows and then read a lot online a lot of people might call this house hacking it’s essentially buying a property that’s also a rental but some of the benefits is that you get the best financing possible so in the US you can use what they call an FHA loan which has as little as 3.5 percent down and you get the best interest rates possible but just because you have the best interest rate possible and the lowest down payment requirement doesn’t mean you should just pick up any property there’s a certain type of a residential property that I found can really work out well for you to listen to some of my other podcasts and read some other material you know that I recommend investing where it makes the most sense but a lot of times that’s difficult a lot of times that sort of intimidating you know for someone especially if this is your first time. Invest in real estate so what ends up happening is you look for property in your neighborhood that’s how I started 10 years ago I lucked out I happen to be in a market that was what was in it was a great time to buy there but it’s not anymore you know they change all the time you know the other thing is if you if your full time job is in your neighborhood you’re in you’re gonna be living there anyway is this could be a good option so you can use those low down payments and those amazing interest rates with an FHA loan to buy a property with up to 4 units so I would recommend buying up I would buy 4 units if you could because if you’re planning on turning into short term rentals you’re gonna have the most possible with that type of loan structure before plexus aren’t always readily available and sometimes their price too high so what you can look for and I actually just bought one of these properties last year it was a single family home but I happen to have a guest house and I actually had a separate entrance to an upstairs bedroom that was for more or less disconnected from the main house already had plumbing for kitchen so I turned that thing into 3 units so a lot of you know I I live in Columbia mo see here but I am a US citizen I’m a resident of Tennessee and I had to use one of these loans so I found a property strainer 0 Bucks about 3.5 percent down you know that’s pretty cheap and it amazing interest rates you can even do things you know like in your contract have the seller pay for closing costs which is gonna help you out even more be less money in your pocket so that’ll be something you want to talk with your agent or your broker about look for properties you know if if you plan on getting a property already especially you know round where you live.

Check these types of properties out you know the ones that have guest house in the back or the potential put a guest house in the back I know California you know with their housing shortage has passed the law I don’t know the specifics on it but they allow a lot of places now to have an auxiliary unit or granny flat or guest house or whatever you wanna call it on the same property but disconnected from your main house.

So that can be a good property look for at the cheapest amount of money another benefit.

As an investor owned short term rentals to having a primary residence that you are operating short term rentals out of is that the regulations are probably gonna be less strict than they would be if it was a straight best for property so most the time I’ve noticed these cities and municipalities passing regulations around short term rentals they typically analysts say all the time because there are some places like Austin for example that almost favors the investor more than that than a residential short term rental but you just wanna be really certain check wherever you’re at a check make sure to check the regulations but a lot of times what happens is is they pass a law that prohibits or. It’s makes it more difficult for a an investor buying short term rentals so if this is your primary residence a lot of times you can get around the regulations as well and while you’re looking for this property if you have decided that invest scene out of state or you know out of your whole neighborhood you’re not quite comfortable with it yet and you are looking for the property in your neighborhood you always want to make sure that it just still makes sense you know so if that property doesn’t cash flow with long term tenants Senate then you may wanna I may want to look at something else that’s my end game backup strategy all the time this is the property needs to make sense with the long term tenants just because you find of a great property and it has the lowest down payment or you can buy with the lowest down payment the lowest interest rate it’s definitely easier but that doesn’t necessarily mean it’s better and I’ll give you a couple reasons why or at least you know things I’ve talked with friends and students that may discourage them from scaling and one of those is is that if you’re operating your short terminal out of the same office same property as your primary residence you’re gonna be seen the gas. More often you’ll you’ll most likely start out managing not maybe even cleaning that yourself if it’s your first short term rental in scene the gas day in and day out you’re gonna feel like it’s too difficult to scale I see this happen all the time you know the messaging and all that versus buying a property somewhere else where you’re forced to set up operations and systems so that property to run itself so I have seen that happen in a recommend if if you’re operating a short term rental of your person residence you’re just getting started hire a housekeeper sooner than later and start delegating some of those tasks and messaging and all the responsibilities so that you don’t get discouraged from scaling.

Now the other thing and I I just noted on this briefly before but it’s likely that where you live is not the best place to invest so even though you have amazing financing options and low down payment options just think about investing somewhere else before you purchase a property in your neighborhood just because it’s easy that said just to recap it can be an excellent option for someone who’s just getting started perhaps that lives in an area that makes sense already then that’s ideal and I would jump on that all day you want to think twice if you’re in an area that is you know very cyclical maybe a coastal market or that has very strict short term rental regulations already most likely going to be in a bigger city or you know a nice residential neighborhood but but that said if you are in an area that makes sense and you can find a residential family so up to 4 units to buy is your personal residence you can use that FHA loan if you’re in the U. S. those financing options available to us you’re gonna pay the least amount down you’re gonna have amazing interest rates and as long as you’re okay with being on the same property short terminal gas coming then I would say jump on that and that for a lot of people can be really easy way to get on the market so ponder that if you haven’t started investing yet start checking out some properties and see if that may be an option for you until next time.

Want to get on the fast track to financial freedom through short term rentals what all searching the properties you. You want to make sure that you acquired the right properties I want to give you my.

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