Ok I have finally took control of my money and have a little bit of money to buy my first home. With the tax brake from Obama this would be the perfect time to do so I would have to say. But on the other hand my goal is to build wealth through real estate. So with the money I have set aside should I buy my first home and or my first property. hmmmm
If you take the advice of many on this board, you could do both by buying a duplex, triplex, or quad to start. You could live in one unit and rent the others. Considering more than just politics, does it make sense to buy in your market at this time? Are prices still falling so fast you can’t see the bottom? What is your time horizon for the length of time you would hold the property? Could you buy now and wait out the price fluctuations?
In the last place we lived, people who had only owned their homes for 3 years were making around $100k profit when they sold their homes in the fall of 2005. I refused to buy in that market because I believed the prices were WAY over-inflated. When we left this past month, many people who bought their homes around the end of 2005 or early 2006 were now well upside-down on their homes and thus became unintentional Landlords. That area is a military community so most people are just there for a few years and have to end up renting the properties to wait out the fluctuations.
Robert Kiyosaki of Rich Dad says that a home is a liability because it takes cash to maintain. What are prices doing in your area? Are they holding their own or dropping? If you get a rental unit, you have some cash flow. You can not use the equity of your house unless you sell it. A duplex is a good idea.
Your own home is definitly not an investment unless it is a 2 fam or better. Not including depreciation and wear and tear, your taxes, maintenance, mortgage with interest, and gas/electric/water expenses, etc make your own home not an investment.
To me, an investment, whether a commodity, stock, real estate or other value, earns dividends and appreciates.
Buy multi-family. They pay your mortgage, all expenses and you get a check every month. What is better than that?
Use FHA financing to purchase a multi family home. You will only have to put down 5% and your renters will be making your payments for you. I would not let them one that u are the owner though. U will get lots of late night knocks on your door.
FHA is only for owner occupied right? Do they have regional offices?
Yeah FHA is only for owner occupied , but you can still use it to buy a 2-4 unit property as long as you live in one of the units.
Just make sure the multifamily makes sense , as there are still some places where rents are very low but per unit prices are quite high.
But in some places you can easily cover your expenses from the rents of the other units.
You don’t really have to worry about their regional offices as it is a nationwide program. Different lenders offer FHA loans. The government is the one that insures the loan…they don’t actually lend out the money.
Definately 100% buy investment property.