Commentary by Shane Dietlin
Editor’s Note: Shane Dietlin bought his first house in 2005 as a 22-year-old Cpl. class in the Marine Corps after learning firsthand the value of owning real estate, creating residual income and being a seasoned investor from his father. Since that time, his mission has become to assist his peers in the military to buy and sell real estate.
The American Dream of homeownership. For our nation’s military, who protect that ideal around the globe (as well as our rights and freedoms), buying and selling real estate is a challenging and tricky process. They deserve to receive extraordinary experiences along every step of the client relationship. For members of the military, there are many rules and regulations they need to be aware of beyond those of civilian consumers.
As an affiliated agent of CENTURY 21 Sweyer & Associates, I have had the pleasure to work with military families for many years. Here, I’d like to provide some proven advice and offer ways my peers in the military can get to their desired outcomes along the real estate journey without learning the hard way and dropping a great deal of unnecessary money.
My first, and perhaps most important, recommendation is that military homebuyers and sellers partner with a real estate agent who specializes in working with consumers in their field in order to get the personalized and unique attention necessary, as well as the support and industry knowledge they need to make informed decisions.
Second, since active military are often relocated every three to five years, it is imperative to think of the home as an investment, specifically the costs of owning a home beyond the mortgage and insurance policies, from the regular upkeep of appliances, electronics and HVAC to potential water hazards. These costs need to be worked into the entire cost of the home, and, ultimately, the decision-making process to buy and/or sell. For example, if the finances pencil out that a buyer would be saving $200 a month versus what they’ve been paying in rent, is that enough to cover any repairs that could arise in the future? Remember, military should think of the property as an investment and not act on it like it’s a home. Conversely, if someone in the military is moving to another base, run the numbers before deciding. In many cases, in lieu of selling, it may make sense to become a landlord and earn rental income.
Lastly, as a local Marine Corps instructor, I want my students to understand the ins and outs of real estate and take advantage of the benefits they earn by the sacrifices made for our country—the biggest example being the VA (Veterans Administration) loan program. Most people think they only have one VA loan per lifetime and that they can only use it after leaving the service. Both are myths. Plus, most military are unaware that there is no fixed VA loan maximum and that they can borrow as much as a lender will lend (this is expected to roll out in 2020, and, as of press time, is not yet confirmed). Of course, most lenders will loan up to the VA’s guarantee. The standard VA loan limit is currently $484,350 for most U.S. counties, an increase from $453,100 in 2018. That means qualified VA buyers in most parts of the country can now borrow up to $484,350 before needing to factor in a down payment.
Knowledge is power. For our nation’s heroes considering real estate as an investment option, the power is understanding these and the many other rules and regulations as they apply to military personnel.