by Jennifer G. Williams
Our military family chose to buy homes in various duty stations — not all, but in the high-military turnover areas around Washington, D.C. and Colorado Springs.
We chose to buy in those areas not just for personal preference (having pets that caused issues when trying to find rental homes, for one), but with the thought that we would keep those homes while we traveled to different duty stations and rent them to military families. This worked well for us for the most part. We were able to keep both homes until we paid off one and sold both homes in the last two years of my husband’s time on active duty. We then were able to buy our dream retirement home. Not to say everything was simple or easy, or that this strategy would work for everyone, but it did for us.
Here’s how we made it work:
The VA Loan is the best thing going for military home buyers.
Now, you can only use it for one home at a time, but if you refinance your home (which we did when interest rates fell significantly), your VA Loan benefits will once again be available. The no-money down option was a lifesaver — particularly when we chose NOT to sell one home before purchasing another. We calculated our BAH and the amount we would spend on rent and took the chance to build equity in a home that would be attractive to military families relocating to the area. Turns out, we bet right. Which brings me to:
Our personal choice for a home in Colorado would have been one high in the mountains, with a lot of land and sweeping mountain views, but we instead chose a home in a well-established neighborhood in an awesome school district.
Also take a look at the distance to the nearby military installation—it may be a cool area, but if it takes more than an hour to drive to work every day, it may be harder to rent to those coveted military families (or, if your house is in the D.C.-area, where traffic is truly a beast and everything is more than an hour away, your home’s proximity to mass transit becomes important). We never had an issue finding military families to rent our houses, but do keep in mind:
Plan for Emergencies and Downtime.
It is SO important to think about the upkeep side. The same expenses you are glad you don’t have to deal with in a rental (leaking roof? Call the owners!) are the ones you must cover when you are the owner. We always had the philosophy that we wanted to treat our renters with the same respect and courtesy we would want from a landlord, so we took care to be extra-responsive when things needed fixing or servicing. This tended to bring out the best in our renters — when they saw that we cared about the house and wanted to make sure it was in great shape, they tended to take better care of it themselves.
We also had a few times when our incoming renters were coming in a month or so later than our outgoing renters were leaving, so we had to be sure we had the money to cover our mortgage payment and the utilities during that time. We also budgeted for yard maintenance during those downtimes, so the house would look lived-in, even when no one was there.
Do It Yourself!
Our Colorado home was a great find since it was a foreclosure in such a desirable area. The awful smells that hit you as you first walked into the abandoned home were enough to drive away most potential buyers, but my husband and I saw opportunity instead. We bought it at a great price, then proceeded to update and replace almost everything from the roof down into the basement.
Doing it ourselves saved us a lot of money at the time, and greatly increased our equity when it was time to sell. Not everyone wants a fixer upper, or has the time or resources to put into such a house, but even updating the little things can pay off in the long run.
“Collecting” houses (as my husband semi-jokingly called it) is not for everyone, but it can result in a pretty good return on investment when your military days are over. Some people choose to return to one of their homes from along the way for retirement. Just do your homework and be prepared for the unexpected, and do what the military lifestyle has trained you to do: be flexible!