Ok I’m new to this forum, so bear with these questions if they’re repetitive. I am a first time investor and would like to buy a muli-unit home so I can live in one and have my tenants pay my mortgage. However, how do I know what is a good deal and how does someone apply for multiple loans/mortgages without it affecting their credit? Also, how do you know if a rental unit is going to make you money or be hard to find tenants? :
Howdy lotsofquestions:
You have a lotofgoodquestions too. i am assuming that you want property that is not in a war zone or high crime area or low income area. Most muti family deals that are available are retail sales where the payment on the mortgage will almost equal the rent collected. For example I see duplexes that sell in MLS etc for $150,000 where the rent per side is $700 to $750 per month. If you can find a bargain you should be able to rent half for $750 and live free if you get a good rate on a loan. The best rates availablle are from banks, mortgage companies etc and most will affect your credit good or bad depending on your payment history etc. You can buy subject to an existing mortgage or get seller financing that will not be reported in your name most often.
Drive the area you are looking at. If you see for rent signs on almost every duplex you will know there is a lot of competition for tenants and it may be hard to find a good tenant. In bad times new property will rent for almost the price of old so the new ones will be full and the older ones will have higher vacancy factors. IDEA look for newer properties. Hope all this helps a bit. Keep asking alotofquestions and you will get some good help from the members here. A great place to learn
Good luck and thank you,
Ted P. Stokely Jr
11505 Sw Oaks
Austin, Texas 78737
512-301-9171 home
512-587-6177 mobile
Thanks Ted. A colleague of mine just purchased a VA foreclosed home in San Antonio and the realtor found buyers and he hasn’t even paid his closing costs yet. The potential buyers are ready to move in so he was contemplating doing a lease-purchase option with them. The home is huge and only cost 96K. Is San Antonio a good place to invest in? I don’t know anyone that lives there, but based on what he claims, there are tons of VA repros right next to a developing area.