I’ve live in the homely county of Suffolk in England so you can tell just how ‘hot’ the property market is!!
I’m actually 18 and waiting for the inheritance of half a masonette and a rough figure of £20,000. I’m reading up all I can however as far as finding a mentor to learn first hand experiance off of is proving somewhat impossible!
I have been led to the idea (from extensive reading) that the best method of starting my REI career would be to get out a loan to buy the other half of the masonette (off of my Dad’s Brother) and get a tenant in to pay the loan off, leaving me £20,000 to invest in another form of REI. How does this sound and has anyone had any experiance in this specific situation or just generally knows enough to know the best plan of action.
I’m concerned that as I’m only 18 even though I will have half a property and some capital behind me that they will laugh when I say “hey, fancy handing over 30-40k to buy the other half of a masonette I already own” But I may be having concerns irrationally.
Any help with this would be greatly appreciated and also if anyone knows how I should go about finding a mentor to learn off of as well as the reading im doing.
I appreciate I’ve rambled on for a few paragraphs! So thanks for taking the time for reading! : ;D
Your buying the other 50% is not uncommon. It is done everyday when couples divorce and business partners separate and in your case too when heirs inherit property together.
Your youth may make it a bit harder to get a loan but i am sure you can do it especially if you only borrow 50% ofd the value. Will renting the remaining space give you a break even cash flow. I am assuming the maisonette consists of just two living quarters.
Congratulations on being only 18 and owning your first piece of property! This can set you up for the rest of your life if you build wisely off of it!
Would that be a “damp” real estate market that you are in? I’m in San Diego, California - mostly warm and dry.
I’m not familiar with the term “masonette”. Is that what we call a duplex? (Two units connected by a common wall.) Any idea how the name came about? Was this the “typical” housing for stone masons - working class people? I find the variations on the same language to be quite interesting. Years ago while traveling in OZ I used the term “fanny pack” to refer to my “hip pack”. Imagine my embarrassment when I learned what that meant to the Britts with whom I was sharing a pint!
Buying the other half of your masonette sound like a very good place to start REI. The bank should be quite happy to loan you the money to buy the other portion of the property as the loan would be secured by your half ownership in the property. You don’t pay - they take the (entire) property. The hard part might be to get your uncle to agree to sell his half to you. Perhaps he would carry the loan for you? Would rents cover the anticipated mortgage payments that you will incur if you buy your uncle out of the property? Can you expect the property to appreciate?
Your next step might be to leverage (borrow against) a portion of the 50% equity that you will have in your current property to buy your next property.
I may have succeeded in asking more questions than I answered, but I hope this is of some use to you.
Hey thanks for both of your replies they are very helpful!
Maybe I should of given you a bit more information, the term ‘masonette’ (it might even be maisonette) refers to a flat like property however one that has a second level to the property through stairs but they remain one property and house one family. It is basically like a mini house which is part of a series of masonettes, like this:
| | | |
| | | |
| | | |
| X | | |
So here you can see that X is where my property is, (or will be should I say!). As I said it is only inheritance at the moment.
One thing to take into consideration I guess is the fact that it is a lease hold from the County Council. However there are 90 years left on the lease and the property lease price does stay about level with the current market.
With regards to buying the other half off of my Uncle I know he has had some very unsound investments (a girlfriend who has a very nice spending habit being one of them!) So buying the other 50% wouldnt be a problem.
Well the place I currently live in holds around 60,000 people so as you can see its not the MOST populated place in the world consequently im guessing the market isnt going to be the most thriving (although im not saying that deals dont exist as im sure they do with some searching!)
However a common phrase used in almost every piece of literature that i’ve read so far…“I wish I would of started earlier!”
With that in mind…what is the best plan of action to take at 18 to get into REI. My plan would be to get into a steady job for around 3-4 years to gain capital and a property to gain some equity before I can seriously start thinking about getting into the REI game. However I may have the wrong idea completely and would much prefer not to have to grind some capital for 3-4 years if its possible!
Again I appreciate that there is a lot of questions and information in my post but any help with this would be much appreciated!
;D