If I buy a duplex as owner-occupied, do I use the Gross Rent from both the units or just the unit I’m renting out when using the 50% and the 2% rule? Please advise and give example if possible.
Thank you!
Both units!
Mike
Thank you! I was told otherwise. Great book, Mike! Just got the book three days ago!
Yia
I would have answered a little differently.
If you plan to only rent out one unit, then apply the 50% and 2% rule to the rental half only using the cost of the rental half only. If duplex costs $50K and you are renting out only one side, owner occupying the other, then use $25K as your base cost for the 50% and 2% rules.
Using Mike’s solution of applying the rules as if both sides will be rental units, gets you to the same place.
Dave T,
Hi, could I bug you to go over the 50% and 2% rules??
Thanks,
Dan :smile