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- Dec 14, 2014
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I'm 43 and have owned homes since I was about 28. Looking back, I wouldn't do it like I did it if I was doing it again. I made a lot of decisions based on what my wife wanted and what I wanted for her. Fool play. We bought a house in the country, fixed it up and did another...and another. Anyway, had I bought houses based on what most people want, instead of where I like to live and where my wife likes to raise animals, I would have done much better. (rural renting is it's own insane universe) When we were looking for our first house I wanted to buy a duplex, live in one side for two years then buy another house and have both sides to rent out. She needed to have a place to raise goddamn chickens.
If you can buy property that makes you money, do that. Buying a place to live makes less sense than buying a place to rent out when you can live in other places cheaper. This is particularly true of a single young person who is building a business. Get a small apartment in a neighborhood you can live in and get it as cheap as you can. If you buy a nice house in the suburbs, by all means rent it out.
I take it you are single. If you buy a place that makes sense for one person living alone, you will need another place later and the place you bought now is not the most desirable rental. One bedroom rentals typically have turn over rates that keep you working at the job of finding tenants. (that job sucks) If you buy a nice house, you can get more renting it than it will cost you to live in a studio which is all the room one man needs.
Think of it this way. Do you want debt that makes money or debt that crumbles around you?
If you are in a position where you can qualify for a mortgage on an owner occupied house it is worth looking at it but only if you are clear on a plan of action to make money. If you buy a house, spend a year in it (establishing residency for the sake of the mortgage) and spend that year fixing everything that isn't perfect in the house and generally laying the ground work for turning it into a profitable rental that you can get great tenants into and then you will have an asset. Rent it out and move into a one man pad. If that isn't what you want to do with your next year, and you MUST be honest with yourself and know what you will and won't do; then skip it. Rent a pad and focus completely on some other profitable endeavor.
To wrap it up. Buy if and only if buying is a business move and if you want to spend some time doing that. If you do, spend that time focused on the house as a business. If you have a Fastlane vehicle you are trying to grow, don't get distracted, just rent a place. If you are looking for your Fastlane vehicle and haven't come up with The Idea that you are going to develop, then maybe spending the time working on creating the real estate asset will give you the breathing room to keep looking and keep thinking.
If you can buy property that makes you money, do that. Buying a place to live makes less sense than buying a place to rent out when you can live in other places cheaper. This is particularly true of a single young person who is building a business. Get a small apartment in a neighborhood you can live in and get it as cheap as you can. If you buy a nice house in the suburbs, by all means rent it out.
I take it you are single. If you buy a place that makes sense for one person living alone, you will need another place later and the place you bought now is not the most desirable rental. One bedroom rentals typically have turn over rates that keep you working at the job of finding tenants. (that job sucks) If you buy a nice house, you can get more renting it than it will cost you to live in a studio which is all the room one man needs.
Think of it this way. Do you want debt that makes money or debt that crumbles around you?
If you are in a position where you can qualify for a mortgage on an owner occupied house it is worth looking at it but only if you are clear on a plan of action to make money. If you buy a house, spend a year in it (establishing residency for the sake of the mortgage) and spend that year fixing everything that isn't perfect in the house and generally laying the ground work for turning it into a profitable rental that you can get great tenants into and then you will have an asset. Rent it out and move into a one man pad. If that isn't what you want to do with your next year, and you MUST be honest with yourself and know what you will and won't do; then skip it. Rent a pad and focus completely on some other profitable endeavor.
To wrap it up. Buy if and only if buying is a business move and if you want to spend some time doing that. If you do, spend that time focused on the house as a business. If you have a Fastlane vehicle you are trying to grow, don't get distracted, just rent a place. If you are looking for your Fastlane vehicle and haven't come up with The Idea that you are going to develop, then maybe spending the time working on creating the real estate asset will give you the breathing room to keep looking and keep thinking.
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