Im tring to get my feet wet by buying my first home that my family and i will live in. I found a house it has 2 renals on the property. one is not fisnished. the house is 3bd 1bth 895sqft. for $65k as is. Will be seeing the property today for first time after husband get off work. He and buddy can do all the work on the renals and property. Will be renting 3rd bd room to the buddy. he will be paying us rent. What should i be looking for in this house and rentals, is this a good idea to buy? My thought is im not sure if i just want to rehab and flipp or do rentals. Any suggestions would be helpful will keep informed on whats going on.
if there is your first home purchase and its going to be primary residence, then don’t worry about flipping etc. I would focus on the fact that “do you like the main house and is that where you want to live”. The fact that you will have two income properties on-site probably means that the rent you generate should cover the mortgage payment and other cost (just a guess).
Here’s a couple of pitfalls to think about:
You are in effect living with your tenants; this has the potential to be a major hassle; you need to accep tthis as part of the deal for basically living for free
Renting out the 3rd bedroom and only having 1 bath room…that means you are going to be sharing a bathroom with your tenant (husband’s buddy). Hmmm…, less than ideal
If you work out some deal of your husband’s buddy of trading rent for work on the unfinished unit, PUT IT WRITING. A verbal, casual agreement of free rent for labor has a high potential for trouble (IMHO).
Is it a good deal??? Who knows; I living in SoCalif where $65k will get you a tool shed with holes in the roof. ;D
I just want to echo the put it in writing part. Whether he works for rent, or pays rent, have it in writing. People hear and remember whatever is in their best interest, the writing jogs everyone’s memory. Avoiding putting it in writing because it may be uncomfortable, just delays the discomfort. It’s better to get it all out in the open at the beginning, rather than having a fight every time an expense arises. Now, if you’re like my wife and wouldn’t mind getting rid of some of your husband’s friends… you could avoid the writing part altogether!!! ;D I lost a good friend to a similar situation the second year I was married… I still hear about it… :-\
Ok first lets me say that the buddy is more like our brother that is at my house every day. The guys go to drive to work together and i make there lunches and they come home and i cook diner for them. He all ready pretty much lives here during the day and goes to his hotel room he rents for $500/mth. He is our daughters uncle and play with the girls every night. So its not going to be a big deal if he lives with us. Second contracts not a problem the two of us have a good thing if its important he wants it written just as much as me.
Third im trying to get the three of us as partners for investing matt our buddy has excellent credit. we have been working on this for awhile. the more we can invest the farther all 3 of us will exceed.
any other responses thanks a head of time.
thanks
kathy
alaska