The Veteran's Guide to Real Estate Investing

Imagine earning enough monthly rental income to cover your mortgage—or even replace your military paycheck entirely. Imagine a future where rental income could pay your bills, maybe even allowing you to leave your military job on your own terms. It could be possible through real estate investing. How do we know? Because some service members are already doing it. 

In this guide, we'll show you how you could make it happen using the tools available to you from your military service. We’ll break down the strategies and Veteran real estate investing resources to help you get started.

One of the best-known military investing resources is the VA loan. About 3 in 4 veterans (74.5%) who purchased a home in the past year put zero dollars down because of their VA loan. This allowed them to sidestep the 10-20% down payment requirement , a barrier for  many would-be homeowners. 

But here's something you might not know: you could also buy investment properties (four units or less) with no down payment using your VA loan. 

That's a massive advantage that could help you build wealth and financial security, whether you're still serving or already transitioned out of military service. This guide is designed to help you understand how to take advantage of the VA loan benefits and start investing in real estate.

What makes VA loans powerful for military real estate investors?

Here are the key advantages of VA loans for military real estate investors:

• Zero down on income-producing properties. Most real estate investors (REIs) need a 20-25% down payment to qualify for an investment property loan. With VA loans, you could buy a duplex, triplex or fourplex with zero money down. Almost 75% of all VA loans in 2024 were zero down payment loans.
• No private mortgage insurance (PMI). When you pay less than 20% down on a conventional loan, PMI is usually required. This costs about 0.3% to 1.15% of your loan amount annually. VA loans do not require PMI, even when you put zero money down. For a $400,000 property, you could save around $1,200 to $4,600 annually in PMI costs.
• Lower interest rates than conventional loans. Since they are backed by a government guarantee, VA loans tend to have lower interest rates than conventional loans. Even a 0.25% difference could save you thousands over the loan term.
• Increased disability income. For service-connected disabled veterans, lenders often multiply the non-taxable VA disability pay by 1.15x to 1.25x to determine qualifying income. So a $3,000 monthly disability check may be treated as $3,750.
  
  As a disabled veteran, this might improve your financial profile on paper, and allow you to access opportunities that may otherwise be out of reach. This plussed-up feature also applies to BAH and BAS for active-duty service members. 

• Flexible credit score requirements. Most VA lenders approve credit scores around 620, while investment property loans sometimes require 680 or more. This flexibility could make VA loans accessible to veterans rebuilding credit or those who've paid cash for years.

VA loan occupancy requirements and workarounds

One key requirement of the VA loan is that you have to occupy the property as your primary residence for at least 12 months. However, this 12-month primary residence requirement might not be as rigid as it sounds.

Most VA lenders only require you to certify intent to occupy the home for at least 12 months, but these documents offer some flexibility. You might be able to move before the 12 months if you present valid reasons that your lender approves, like PCS orders.

Your strategy as a newbie to veteran real estate investing could be to house hack: you move in, fulfill your one-year requirement, and then you're free to turn that property into a rental. Best of all, you could repeat this process.

This is possible because of your reusable VA loan entitlement. That is, after buying a property with a VA loan, you could still have enough "bonus entitlement" left to purchase another one, often with zero down payment. 

For example, if you purchase a $400,000 home, you're using $100,000 of your entitlement (25% of the loan amount). This $100k is the amount the VA could guarantee for the lender.

For most counties, the 2025 conforming loan limit is $806,500. Twenty five percent of that is $201,625, meaning you might still have around $101,625 in remaining entitlement. This could be enough to purchase another property with zero money down while keeping the first as rental investment property.

House Hacking – a first step by military real estate investors

For beginner military REIs, house hacking might seem like the perfect strategy. You buy a multi-unit property, live in one unit, and rent the others out. Essentially, your tenants’ rent payments could cover some or all of your loan payment, while you build equity and get your start as a real estate investor. You could even apply this strategy to a single-family home by renting out spare rooms.

How to calculate House Hacking numbers

Here's the breakdown on a $400,000 fourplex purchase with zero down:​

• Purchase price: $400,000
• Down payment: $0 (VA loan)
• Monthly mortgage (6.5% rate): ~$2,900
• Rental income: 3 units at $1,000 each = $3,000
• Monthly profit: $100​

This example shows how powerful house hacking could be as a first step in real estate investing for veterans. You essentially have your mortgage paid for, while simultaneously building equity in a $400,000 asset. Your tenants help you pay off the loan payment, property taxes and insurance. 

After fulfilling the 12-month occupancy requirement, you could rent out your own unit for another $1,000 monthly. Your monthly cash flow becomes $1,100/month as you plan your next house hack.

Kiavi Tip: House hacking takes work upfront. You might have to self-manage initially. It could become a bit more passive over time, when you could justify hiring a PM (property manager).

Veteran real estate investing resources and education

 Besides the VA loan benefits, here are some veteran real estate investing resources you could use to start building wealth through real estate.

Free and low-cost learning resources

• David Pere's Military Millionaire podcast. Currently at 320 episodes, this podcast covers VA loan tips, house hacking and FIRE (Financial Independence, Retire Early) strategies. Pere has walked the path. He is a Marine Corps veteran who went from a negative net worth to having over 100 rental units in five years. Through this podcast, he shares what he learned.
• BiggerPockets’ forums and podcasts also offer real-life stories and practical knowledge from other veterans. On BiggerPockets, you could learn from REIs in the field about different strategies, from house hacking to BRRRR. You might also find the extra support you need (Realtors, lenders, partners, mentors etc.) through the platform.
• Brandon Turner's 'The Book on Rental Property Investing' and Craig Curelop's 'The House Hacking Strategy' consistently get recommended in veteran investor communities as incredibly helpful resources for those starting out in REI. 
• Check out your local REIA. These meetings could offer a fantastic way to connect with REIs who might be able to offer you personalized guidance. Some Real Estate Investor Association chapters even offer discounts for veterans.

Military-focused REI communities

Joining a community of people with the same background and who are doing the same thing you want to do could also accelerate your learning. Whether it's online through Facebook groups like Military Landlords or in person at local veteran REI meetups like REI Genius (in Leesburg, VA), you'll be able to tap into the collective knowledge and experience of others who get what you're trying to achieve as a military REI. 

In these communities, you could ask targeted questions about managing investment properties during a PCS or finding reliable contractors, and receive practical, real-world advice.

Financial analysis tools

There are free tools to help you confidently analyze a property's potential income, your estimated cash flow, and your remaining buying power.

1. Rent estimator tools: As the name implies, this could help you estimate rent (income). This is something you might want to do before anything else. You could use a tool like Rentometer to find the market rent for specific addresses. You could also cross-reference the output with Zillow's Rent Zestimate for increased accuracy.
2. Rental property calculators: Once you know the rent, loan payment and expenses, it's time to know if buying an investment property actually makes financial sense. You could plug these numbers into a tool like TurboTenant's rental property calculator to estimate your potential cash flow and return on investment.
3. VA loan calculator: Before making an offer on a second property, you might want to check your VA loan entitlement to see if you could still buy with zero down while turning your first one into a full rental property. You can check your remaining entitlement using the VA's official calculator at lgy.va.gov.
4. Home value estimators: Avoid overpaying for investment properties by checking tools like Zillow's Zestimate and Kiavi's ARV estimator for comp-based price estimates. You should combine multiple tools for the best accuracy.
5. Spreadsheet: Track both your probable and actual numbers in a spreadsheet. When dealing with multiple properties, it's easy to lose track of income, expenses, and maintenance costs. A spreadsheet helps you keep tabs on these so you can identify what's working and what's not. With this data, you could confidently decide where to invest next and which investment properties to sell.

Managing investment properties during PCS moves

If you're an active service member thinking about investing in real estate, you shouldn't let the thought of a PCS move scare you off. With the right systems in place, you could manage this hurdle. For most active-duty landlords, this may involve hiring a professional property manager.

Setting up property management before you PCS

• When to hire: You could hire a Property Manager (PM) anytime, but you'd probably need one during deployment.
• Cost: Property managers typically charge 8-12% of monthly rent. For example, prepare to pay around $200 monthly if your rent is $2,000. While this cost eats into your cash flow, you should consider it an operational cost. Hiring a professional property manager could help you get some peace of mind. They manage tenant screening, maintenance issues, evictions, and more, saving you time and potential legal liability fees.
• Vetting: Ask about their average response times for maintenance requests, their communication systems, and how they'd handle emergencies whenever you're unreachable. You could also request references from other military landlords they have worked with.
• Cash reserves: Before you PCS, it’s important to have some financial flexibility to help cover potential costs like unexpected repairs, vacancies, or routine maintenance. A good guideline might be to set aside 10% of your property's value—for example, $40,000 for a $400,000 property—to ensure you’re prepared.

Self-management strategies for active duty

With property management software, it is possible to self-manage rental units while fulfilling the demands of your military career. These property management tools could help you automate key tasks like rent collection, maintenance and repairs management, and vendor payments - all from anywhere in the world. 

Buildium and Appfolio, for example, even offer 24/7 maintenance call centers that help you respond to tenant inquiries and requests, and alert you (or someone you designate) to emergencies.

Also, you could build a network of contractors before your move. This might include plumbers, HVAC specialists, and electricians. Negotiate rates upfront, store contacts in your property management software, and arrange for trusted local contacts to verify the quality of their work.

And of course, don’t forget those cash reserves. A contingency fund of up to 10% of property value could help you stay on top of potential issues like repairs and vacancies, and help you minimize stress while serving.

Conclusion

Your military service has uniquely prepared you for success in real estate investing. As a veteran, you have access to invaluable resources such as VA loans, exclusive programs, specialized training, and a supportive network to help you thrive in your real estate journey.

Plus, the resilience and discipline you've developed during your military could be transferable to real estate investing. With these qualities, along with access to military-specific resources and the house hacking strategy, you have the tools to build financial freedom. It’s entirely within your reach!

Beyond VA loans, a bridge loan might be something to consider if you’re thinking of renovating your duplex or fourplex. Learn more about bridge loans.

Frequently Asked Questions (FAQs)

Q: Can I use a VA loan to buy an investment property?

A: Yes, you could! While VA loans are primarily for primary residences, you could use them to buy multi-unit properties with up to four units, as long as you occupy one unit as your primary residence. This approach may allow you to reduce your living costs or even live rent-free while rental income from the other units helps cover your loan payments and build equity. 

Q: Do VA loans require a down payment?

A: One of the biggest advantages of a VA loan is that it often doesn’t require a down payment for eligible veterans. This could make it easier to start investing in income-producing properties, as it removes the need for a large upfront cash payment.  

Q: Can VA disability income help me qualify for a loan?

A: Yes, lenders may consider the projected rental income from additional units when evaluating your loan application. This could increase your debt-to-income ratio, making it easier to qualify for financing and invest in multi-unit properties.  

Q: Do I need to stay in the property I purchase with a VA loan?

A: Yes, VA loans have an owner-occupancy requirement. Typically, you must live in the property as your primary residence for at least 12 months. However, this still allows you to “house hack” by living in one unit of a multi-unit property while renting out the others, maximizing the benefits of your VA loan.